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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2024

or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ________

 

Commission file number 001-15925

COMMUNITY HEALTH SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Delaware

13-3893191

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

 

 

4000 Meridian Boulevard

Franklin, Tennessee

37067

(Zip Code)

(Address of principal executive offices)

 

615-465-7000

(Registrant’s telephone number)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $.01 par value

CYH

New York Stock Exchange

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Smaller reporting company

 

 

 

Non-accelerated filer

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of April 19, 2024, there were outstanding 138,966,388 shares of the Registrant’s Common Stock, $0.01 par value.

 

 


Community Health Systems, Inc.

Form 10-Q

For the Three Months Ended March 31, 2024

 

 

 

 

 

 

 

 

Part I.

 

Financial Information

 

Page

 

 

 

 

 

 

 

 

 

Item 1.

 

Financial Statements:

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Loss – Three Months Ended March 31, 2024 and March 31, 2023 (Unaudited)

 

2

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Comprehensive Loss – Three Months Ended March 31, 2024 and March 31, 2023 (Unaudited)

 

3

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets – March 31, 2024 and December 31, 2023 (Unaudited)

 

4

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows – Three Months Ended March 31, 2024 and March 31, 2023 (Unaudited)

 

5

 

 

 

 

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements (Unaudited)

 

6

 

 

 

 

 

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

21

 

 

 

 

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

 

37

 

 

 

 

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

37

 

 

 

 

 

 

 

Part II.

 

Other Information

 

38

 

 

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

38

 

 

 

 

 

 

 

 

 

Item 1A.

 

Risk Factors

 

39

 

 

 

 

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

39

 

 

 

 

 

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

 

40

 

 

 

 

 

 

 

 

 

Item 4.

 

Mine Safety Disclosures

 

40

 

 

 

 

 

 

 

 

 

Item 5.

 

Other Information

 

40

 

 

 

 

 

 

 

 

 

Item 6.

 

Exhibits

 

41

 

 

 

 

 

 

 

Signatures

 

42

 

 


 

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF LOSS

(In millions, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2024

 

 

2023

 

Net operating revenues

 

$

3,140

 

 

$

3,108

 

Operating costs and expenses:

 

 

 

 

 

 

Salaries and benefits

 

 

1,368

 

 

 

1,365

 

Supplies

 

 

487

 

 

 

507

 

Other operating expenses

 

 

845

 

 

 

835

 

Lease cost and rent

 

 

77

 

 

 

81

 

Depreciation and amortization

 

 

115

 

 

 

132

 

Impairment and (gain) loss on sale of businesses, net

 

 

17

 

 

 

(22

)

Total operating costs and expenses

 

 

2,909

 

 

 

2,898

 

Income from operations

 

 

231

 

 

 

210

 

Interest expense, net

 

 

211

 

 

 

207

 

Equity in earnings of unconsolidated affiliates

 

 

(2

)

 

 

(3

)

Income before income taxes

 

 

22

 

 

 

6

 

Provision for income taxes

 

 

28

 

 

 

26

 

Net loss

 

 

(6

)

 

 

(20

)

Less: Net income attributable to noncontrolling interests

 

 

35

 

 

 

31

 

Net loss attributable to Community Health Systems,
   Inc. stockholders

 

$

(41

)

 

$

(51

)

Loss per share attributable to Community Health
   Systems, Inc. stockholders:

 

 

 

 

 

 

Basic

 

$

(0.32

)

 

$

(0.40

)

Diluted

 

$

(0.32

)

 

$

(0.40

)

Weighted-average number of shares outstanding:

 

 

 

 

 

 

Basic

 

 

131,272,044

 

 

 

129,688,917

 

Diluted

 

 

131,272,044

 

 

 

129,688,917

 

 

See accompanying notes to the condensed consolidated financial statements.

 

2


 

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In millions)

(Unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2024

 

 

2023

 

Net loss

 

$

(6

)

 

$

(20

)

Other comprehensive (loss) income, net of income taxes:

 

 

 

 

 

 

Net change in fair value of available-for-sale debt securities,
   net of tax

 

 

(2

)

 

 

3

 

Other comprehensive (loss) income

 

 

(2

)

 

 

3

 

Comprehensive loss

 

 

(8

)

 

 

(17

)

Less: Comprehensive income attributable to noncontrolling
   interests

 

 

35

 

 

 

31

 

Comprehensive loss attributable to Community Health
   Systems, Inc. stockholders

 

$

(43

)

 

$

(48

)

 

See accompanying notes to the condensed consolidated financial statements.

3


 

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

(Unaudited)

 

 

 

March 31,
2024

 

 

December 31,
2023

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

48

 

 

$

38

 

Patient accounts receivable

 

 

2,194

 

 

 

2,231

 

Supplies

 

 

329

 

 

 

328

 

Prepaid income taxes

 

 

34

 

 

 

76

 

Prepaid expenses and taxes

 

 

263

 

 

 

260

 

Other current assets

 

 

307

 

 

 

275

 

Total current assets

 

 

3,175

 

 

 

3,208

 

Property and equipment

 

 

9,607

 

 

 

9,511

 

Less accumulated depreciation and amortization

 

 

(4,388

)

 

 

(4,304

)

Property and equipment, net

 

 

5,219

 

 

 

5,207

 

Goodwill

 

 

3,957

 

 

 

3,958

 

Deferred income taxes

 

 

29

 

 

 

29

 

Other assets, net

 

 

2,037

 

 

 

2,053

 

Total assets

 

$

14,417

 

 

$

14,455

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Current maturities of long-term debt

 

$

34

 

 

$

21

 

Current operating lease liabilities

 

 

115

 

 

 

124

 

Accounts payable

 

 

941

 

 

 

912

 

Accrued liabilities:

 

 

 

 

 

 

Employee compensation

 

 

504

 

 

 

571

 

Accrued interest

 

 

207

 

 

 

160

 

Other

 

 

335

 

 

 

354

 

    Total current liabilities

 

 

2,136

 

 

 

2,142

 

Long-term debt

 

 

11,533

 

 

 

11,466

 

Deferred income taxes

 

 

354

 

 

 

369

 

Long-term operating lease liabilities

 

 

546

 

 

 

563

 

Other long-term liabilities

 

 

726

 

 

 

739

 

Total liabilities

 

 

15,295

 

 

 

15,279

 

Redeemable noncontrolling interests in equity of consolidated subsidiaries

 

 

329

 

 

 

323

 

STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

Community Health Systems, Inc. stockholders’ deficit:

 

 

 

 

 

 

Preferred stock, $.01 par value per share, 100,000,000 shares authorized; none issued

 

 

 

 

 

 

Common stock, $.01 par value per share, 300,000,000 shares authorized; 138,966,388
   shares issued and outstanding at March 31, 2024, and
136,774,911 shares issued
   and outstanding at December 31, 2023

 

 

1

 

 

 

1

 

Additional paid-in capital

 

 

2,192

 

 

 

2,185

 

Accumulated other comprehensive loss

 

 

(16

)

 

 

(14

)

Accumulated deficit

 

 

(3,605

)

 

 

(3,564

)

Total Community Health Systems, Inc. stockholders’ deficit

 

 

(1,428

)

 

 

(1,392

)

Noncontrolling interests in equity of consolidated subsidiaries

 

 

221

 

 

 

245

 

Total stockholders’ deficit

 

 

(1,207

)

 

 

(1,147

)

Total liabilities and stockholders’ deficit

 

$

14,417

 

 

$

14,455

 

 

See accompanying notes to the condensed consolidated financial statements.

4


 

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2024

 

 

2023

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$

(6

)

 

$

(20

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

115

 

 

 

132

 

Deferred income taxes

 

 

(14

)

 

 

7

 

Stock-based compensation expense

 

 

6

 

 

 

6

 

Impairment and (gain) loss on sale of businesses, net

 

 

17

 

 

 

(22

)

Other non-cash expenses, net

 

 

33

 

 

 

42

 

Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:

 

 

 

 

 

 

Patient accounts receivable

 

 

39

 

 

 

(2

)

Supplies, prepaid expenses and other current assets

 

 

(40

)

 

 

(50

)

Accounts payable, accrued liabilities and income taxes

 

 

(13

)

 

 

(32

)

Other

 

 

(41

)

 

 

(56

)

Net cash provided by operating activities

 

 

96

 

 

 

5

 

Cash flows from investing activities:

 

 

 

 

 

 

Acquisitions of facilities and other related businesses

 

 

(1

)

 

 

(8

)

Purchases of property and equipment

 

 

(93

)

 

 

(122

)

Proceeds from disposition of hospitals and other ancillary operations

 

 

 

 

 

92

 

Proceeds from sale of property and equipment

 

 

1

 

 

 

5

 

Purchases of available-for-sale debt securities and equity securities

 

 

(4

)

 

 

(26

)

Proceeds from sales of available-for-sale debt securities and equity securities

 

 

12

 

 

 

61

 

Purchases of investments in unconsolidated affiliates

 

 

(4

)

 

 

(5

)

Increase in other investments

 

 

(10

)

 

 

(16

)

Net cash used in investing activities

 

 

(99

)

 

 

(19

)

Cash flows from financing activities:

 

 

 

 

 

 

Repurchase of restricted stock shares for payroll tax withholding requirements

 

 

(2

)

 

 

(4

)

Proceeds from noncontrolling investors in joint ventures

 

 

 

 

 

2

 

Redemption of noncontrolling investments in joint ventures

 

 

 

 

 

(1

)

Distributions to noncontrolling investors in joint ventures

 

 

(50

)

 

 

(44

)

Other borrowings

 

 

17

 

 

 

29

 

Proceeds from ABL Facility

 

 

933

 

 

 

815

 

Repayments of long-term indebtedness

 

 

(885

)

 

 

(757

)

Net cash provided by financing activities

 

 

13

 

 

 

40

 

Net change in cash and cash equivalents

 

 

10

 

 

 

26

 

Cash and cash equivalents at beginning of period

 

 

38

 

 

 

118

 

Cash and cash equivalents at end of period

 

$

48

 

 

$

144

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

Interest payments

 

$

(149

)

 

$

(197

)

Income tax payments, net

 

$

 

 

$

 

 

See accompanying notes to the condensed consolidated financial statements.

 

 

 

5


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

 

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

The unaudited condensed consolidated financial statements of Community Health Systems, Inc. (the “Parent Company”) and its subsidiaries (the “Company”) as of March 31, 2024 and December 31, 2023 and for the three-month periods ended March 31, 2024 and 2023, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such periods. All intercompany transactions and balances have been eliminated. The results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2024. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements. Actual results could differ from these estimates under different assumptions or conditions.

Certain information and disclosures normally included in the notes to the consolidated financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission (the “SEC”). The Company believes the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2023, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 21, 2024 (“2023 Form 10-K”).

Noncontrolling interests in less-than-wholly-owned consolidated subsidiaries of the Parent Company are presented as a component of total equity in the condensed consolidated balance sheets to distinguish between the interests of the Parent Company and the interests of the noncontrolling owners. Noncontrolling interests that are redeemable or may become redeemable at a fixed or determinable price at the option of the holder or upon the occurrence of an event outside of the control of the Company are presented in mezzanine equity in the condensed consolidated balance sheets.

Substantially all of the Company’s operating costs and expenses are “cost of revenue” items. Operating costs that could be classified as general and administrative by the Company include the Company’s corporate office costs at its Franklin, Tennessee office, which were $82 million and $61 million for the three months ended March 31, 2024 and 2023, respectively. The increase in corporate office costs during the three months ended March 31, 2024 compared to the same period in 2023 is primarily due to increased expense for incentive compensation and the impact of certain non-recurring adjustments.

Throughout these notes to the unaudited condensed consolidated financial statements, Community Health Systems, Inc., and its consolidated subsidiaries are referred to on a collective basis as the “Company.” This drafting style is not meant to indicate that the publicly-traded Parent Company or any particular subsidiary of the Parent Company owns or operates any asset, business, or property. The hospitals, operations and businesses described in this filing are owned and operated, and management services provided, by distinct and indirect subsidiaries of Community Health Systems, Inc.

Revenue Recognition.

Net Operating Revenues

Net operating revenues are recorded at the transaction price estimated by the Company to reflect the total consideration due from patients and third-party payors in exchange for providing goods and services in patient care. These services are considered to be a single performance obligation and have a duration of less than one year. Revenues are recorded as these goods and services are provided. The transaction price, which involves significant estimates, is determined based on the Company’s standard charges for the goods and services provided, with a reduction recorded for price concessions related to third party contractual arrangements as well as patient discounts and other patient price concessions. During the three months ended March 31, 2024 and 2023, the impact of changes to the inputs used to determine the transaction price was considered immaterial.

6


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

Currently, several states utilize supplemental reimbursement programs for the purpose of providing reimbursement to providers that is not specifically tied to an individual’s care, some of which offsets a portion of the cost of providing care to Medicaid and indigent patients. The programs are funded with a combination of state and federal resources, including, in certain instances, fees or taxes levied on the providers. The programs are generally authorized by the Centers for Medicare & Medicaid Services (“CMS”) for a specified period of time and require CMS’s approval to be extended. Under these supplemental programs, the Company recognizes revenue and related expenses in the period in which amounts are estimable and payment is reasonably assured. Reimbursement under these programs is reflected in net operating revenues. Taxes or other program-related costs are reflected in other operating expenses.

The Company’s net operating revenues for the three months ended March 31, 2024 and 2023 have been presented in the following table based on an allocation of the estimated transaction price with the patient between the primary patient classification of insurance coverage (in millions):

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2024

 

 

2023

 

Medicare

 

$

596

 

 

$

649

 

Medicare Managed Care

 

 

579

 

 

 

543

 

Medicaid

 

 

441

 

 

 

423

 

Managed Care and other third-party payors

 

 

1,480

 

 

 

1,469

 

Self-pay

 

 

44

 

 

 

24

 

Total

 

$

3,140

 

 

$

3,108

 

 

Patient Accounts Receivable

Patient accounts receivable are recorded at net realizable value based on certain assumptions determined by each payor. For third-party payors including Medicare, Medicare Managed Care, Medicaid and Managed Care, the net realizable value is based on the estimated contractual reimbursement percentage, which is based on current contract prices or historical paid claims data by payor. For self-pay accounts receivable, which includes patients who are uninsured and the patient responsibility portion for patients with insurance, the net realizable value is determined using estimates of historical collection experience without regard to aging category. These estimates are adjusted for estimated conversions of patient responsibility portions, expected recoveries and any anticipated changes in trends.

Patient accounts receivable can be impacted by the effectiveness of the Company’s collection efforts. Additionally, significant changes in payor mix, business office operations, economic conditions or trends in federal and state governmental healthcare coverage could affect the net realizable value of accounts receivable. The Company also continually reviews the net realizable value of accounts receivable by monitoring historical cash collections as a percentage of trailing net operating revenues, as well as by analyzing current period net operating revenues and admissions by payor classification, days revenue outstanding, the composition of self-pay receivables between pure self-pay patients and the patient responsibility portion of third-party insured receivables, the impact of recent acquisitions and dispositions and the impact of current macroeconomic conditions and other events.

Final settlements for some payors and programs are subject to adjustment based on administrative review and audit by third parties. As a result of these final settlements, the Company has recorded amounts due to third-party payors of $74 million and $97 million as of March 31, 2024 and December 31, 2023, respectively, and these amounts are included in accrued liabilities-other in the accompanying condensed consolidated balance sheets. Amounts due from third-party payors were $131 million and $130 million as of March 31, 2024 and December 31, 2023, respectively, and are included in other current assets in the accompanying condensed consolidated balance sheets. Substantially all Medicare and Medicaid cost reports are final settled through 2019.

7


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

Charity Care

In the ordinary course of business, the Company renders services to patients who are financially unable to pay for hospital care. The Company’s policy is to not pursue collections for such amounts; therefore, the related charges for those patients who are financially unable to pay and that otherwise do not qualify for reimbursement from a governmental program are not reported in net operating revenues, and are thus classified as charity care. The Company determines amounts that qualify for charity care based on the patient’s household income relative to the federal poverty level guidelines, as established by the federal government.

These charity care services are estimated to be $316 million and $326 million for the three months ended March 31, 2024 and 2023, respectively, representing the value (at the Company’s standard charges) of these charity care services that are excluded from net operating revenues. The estimated cost incurred by the Company to provide these charity care services to patients who are unable to pay was approximately $30 million and $38 million for the three months ended March 31, 2024 and 2023, respectively. The estimated cost of these charity care services was determined using a ratio of cost to gross charges and applying that ratio to the gross charges associated with providing care to charity patients for the period.

Accounting for the Impairment or Disposal of Long-Lived Assets. During the three months ended March 31, 2024, the Company recorded an impairment charge of approximately $17 million primarily to reduce the carrying value of several assets that were idled, disposed of or held-for-sale.

During the three months ended March 31, 2023, the Company recorded a net gain of approximately $22 million, comprised of a gain of $25 million related to the sale of a hospital on January 1, 2023, offset by an approximately $3 million impairment charge recorded to reduce the carrying value of several assets that were idled, disposed of or held-for-sale.

The Company will continue to evaluate the potential for impairment of the long-lived assets of hospitals and other held-and-used businesses as well as evaluate offers for potential sales, as applicable. Based on such analysis, additional impairment charges may be recorded in the future.

New Accounting Pronouncements. In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures.” This ASU includes additional requirements for the disclosure of significant segment expenses and segment measure(s) of profit or loss, as well as new disclosure requirements for entities with a single reportable segment and certain qualitative information about the chief operating decision maker. This ASU is effective for annual periods beginning after December 15, 2023 and interim periods beginning after December 15, 2024. The amendments in this ASU must be applied retrospectively to all periods presented. Early adoption is permitted. The Company is currently evaluating the impact that adoption of this ASU will have on its condensed consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740), Improvements to Income Tax Disclosures.” This ASU establishes new requirements for the categorization and disaggregation of information in the rate reconciliation as well as for disaggregation of income taxes paid. Additionally, this ASU modifies and eliminates certain existing requirements for indefinitely reinvested foreign earnings and unrecognized tax benefits. This ASU is effective for annual periods beginning after December 15, 2024 and interim periods beginning after December 15, 2025. The amendments in this ASU should be applied on a prospective basis and early adoption is permitted. The Company is currently evaluating the impact that adoption of this ASU will have on its condensed consolidated financial statements.

The Company has evaluated all other recently issued, but not yet effective, ASUs and does not expect the eventual adoption of such ASUs to have a material impact on its consolidated financial position or results of operations.

8


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

2. ACCOUNTING FOR STOCK-BASED COMPENSATION

Stock-based compensation awards have been granted under the Community Health Systems, Inc. Amended and Restated 2009 Stock Option and Award Plan, which was most recently amended and restated as of March 22, 2023 and most recently approved by the Company’s stockholders at the annual meeting of stockholders held on May 9, 2023 (the “2009 Plan”).

The 2009 Plan provides for the grant of incentive stock options intended to qualify under Section 422 of the Internal Revenue Code (“IRC”) and for the grant of stock options which do not so qualify, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), performance-based shares or units and other share awards. Persons eligible to receive grants under the 2009 Plan include the Company’s directors, officers, employees and consultants. To date, all options granted under the 2009 Plan have been “nonqualified” stock options for tax purposes. Generally, these options vest in one-third increments on each of the first three anniversaries of the option grant date and expire on the tenth anniversary of the option grant date. The exercise price of all options granted under the 2009 Plan is equal to the fair value of the Company’s common stock on the option grant date. As of March 31, 2024, 3,895,174 shares of unissued common stock were reserved for future grants under the 2009 Plan.

The following table reflects the impact of total compensation expense related to stock-based equity plans on the reported operating results for the respective periods (in millions):

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2024

 

 

2023

 

Effect on income before income taxes

 

$

(6

)

 

$

(6

)

Effect on net loss

 

$

(5

)

 

$

(5

)

 

At March 31, 2024, $34 million of unrecognized stock-based compensation expense related to outstanding unvested stock options, restricted stock and restricted stock units (the terms of which are summarized below) was expected to be recognized over a weighted-average period of 24 months. Of that amount, $6 million relates to outstanding unvested stock options expected to be recognized over a weighted-average period of 24 months and $28 million relates to outstanding unvested restricted stock and RSUs expected to be recognized over a weighted-average period of 24 months. There were no modifications to awards during the three months ended March 31, 2024 and 2023.

 

The fair value of stock options was estimated using the Black Scholes option pricing model with the following assumptions and weighted-average fair values during the three months ended March 31, 2024 and 2023:

 

 

 

Three Months Ended
March 31,

 

 

2024

 

2023

Expected volatility

 

90.1%

 

87.3%

Expected dividends

 

 

Expected term

 

6 years

 

6 years

Risk-free interest rate

 

4.3%

 

4.2%

 

In determining the expected term, the Company examined concentrations of option holdings and historical patterns of option exercises and forfeitures, as well as forward-looking factors, in an effort to determine if there were any discernible employee populations. From this analysis, in determining the expected term for both of the three-month periods ended March 31, 2024 and 2023, the Company identified one population, consisting of persons receiving grants of stock options. The computation of expected term was performed using the simplified method for all stock options granted in the periods presented. The simplified method was used as a result of the Company determining that historical exercise data does not provide a reasonable basis for the expected term of its grants, due primarily to the limited number of stock option exercises that have occurred.

 

The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of the grant. The pre-vesting forfeiture rate is based on historical rates and forward-looking factors for each population identified. The Company adjusts the estimated forfeiture rate to its actual experience.

9


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

The expected volatility rate was estimated based on historical volatility. In determining expected volatility, the Company also reviewed the market-based implied volatility of actively traded options of its common stock and determined that historical volatility utilized to estimate the expected volatility rate did not differ significantly from the implied volatility.

Options outstanding and exercisable under the 2009 Plan as of March 31, 2024, and changes during the three-month period following December 31, 2023, was as follows (in millions, except share and per share data):

 

 

 

 

 

 

 

 

 

Weighted-

 

Aggregate

 

 

 

 

 

 

Weighted-

 

 

Average

 

Intrinsic

 

 

 

 

 

 

Average

 

 

Remaining

 

Value as of

 

 

 

 

 

 

Exercise

 

 

Contractual

 

March 31,

 

 

 

Shares

 

 

Price

 

 

Term

 

2024

 

Outstanding at December 31, 2023

 

 

3,630,750

 

 

$

7.07

 

 

 

 

 

 

Granted

 

 

901,000

 

 

 

2.87

 

 

 

 

 

 

Exercised

 

 

 

 

 

 

 

 

 

 

 

Forfeited and cancelled

 

 

(27,000

)

 

 

4.96

 

 

 

 

 

 

Outstanding at March 31, 2024

 

 

4,504,750

 

 

$

6.24

 

 

7.7 years

 

$

1

 

Exercisable at March 31, 2024

 

 

2,807,739

 

 

$

6.98

 

 

6.7 years

 

$

 

 

The weighted-average grant date fair value of stock options granted during the three months ended March 31, 2024 and 2023 was $2.19 and $4.61, respectively. The aggregate intrinsic value (calculated as the number of in-the-money stock options multiplied by the difference between the Company’s closing stock price on the last trading day of the reporting period ($3.50) and the exercise price of the respective stock options) in the table above represents the amount that would have been received by the option holders had all option holders exercised their options on March 31, 2024. This amount changes based on the market value of the Company’s common stock. No stock options were exercised during the three months ended March 31, 2024. The aggregate intrinsic value of options exercised was less than $1 million during the three months ended March 31, 2023. The aggregate intrinsic value of options vested and expected to vest approximates that of the outstanding options.

 

The Company has also awarded restricted stock under the 2009 Plan to employees of certain subsidiaries. With respect to time-based vesting restricted stock that has been awarded under the 2009 Plan, the restrictions on these shares have generally lapsed in one-third increments on each of the first three anniversaries of the award date. In addition, certain of the restricted stock awards granted to the Company’s senior executives have contained performance objectives required to be met in addition to any time-based vesting requirements. If the applicable performance objectives are not attained, these awards will be forfeited in their entirety. For performance-based awards, the performance objectives are measured cumulatively over a three-year period. If the applicable target performance objective is met at the end of the three-year period, then the restricted stock award subject to such performance objective will vest in full on the third anniversary of the award date. Additionally, for these performance-based awards, based on the level of achievement for the applicable performance objective within the parameters specified in the award agreement, the number of shares to be issued in connection with the vesting of the award may be adjusted to decrease or increase the number of shares specified in the original award. Notwithstanding the above-mentioned performance objectives and vesting requirements, the restrictions with respect to restricted stock granted under the 2009 Plan may lapse earlier in the event of death, disability, change in control of the Company or, other than for performance-based awards, termination of employment by the Company for any reason other than for cause of the holder of the restricted stock. On March 1, 2024, restricted stock awards subject to performance objectives granted on March 1, 2021 vested based on the Company’s cumulative performance compared to performance objectives for the 2021 through 2023 performance period, which were set prior to the date of grant. Such awards vested at 80% of the number of shares originally granted to the Company’s then executive chairman, chief executive officer and chief financial officer based on the performance objectives applicable to the then executive chairman, chief executive officer and chief financial officer, and at 100% of the number of shares originally granted to other senior executives based on the performance objectives applicable to such other senior executives. Restricted stock awards subject to performance objectives that have not yet been satisfied are not considered outstanding for purposes of determining diluted earnings per share unless the performance objectives have been satisfied on the basis of results through the end of each respective reporting period.

10


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

Restricted stock outstanding under the 2009 Plan as of March 31, 2024, and changes during the three-month period following December 31, 2023, was as follows:

 

 

 

 

 

 

Weighted-

 

 

 

 

 

 

Average Grant

 

 

 

Shares

 

 

Date Fair Value

 

Unvested at December 31, 2023

 

 

6,053,823

 

 

$

8.00

 

Granted

 

 

2,842,000

 

 

 

2.87

 

Vested

 

 

(2,111,567

)

 

 

8.47

 

Forfeited

 

 

(147,001

)

 

 

8.34

 

Unvested at March 31, 2024

 

 

6,637,255

 

 

 

5.65

 

 

RSUs have been granted to the Company’s non-management directors under the 2009 Plan. Each of the Company’s then serving non-management directors received grants under the 2009 Plan of 62,718 RSUs and 29,268 RSUs with a grant date of March 1, 2024 and 2023, respectively. Both the March 2024 and 2023 grants had a grant date fair value of approximately $180,000. In addition to the grants set forth above, on March 1, 2024 and March 1, 2023, the non-employee Chairman of the Board of Directors was awarded an additional grant of 92,334 RSUs and 43,089 RSUs, respectively, each with a grant date fair value of approximately $265,000, as additional compensation for serving as Chairman of the Board of Directors. Vesting of these RSUs occurs in one-third increments on each of the first three anniversaries of the award date or upon the director’s earlier cessation of service on the Board of Directors, other than for cause. Each non-management director may elect, prior to the beginning of the calendar year in which the award is granted, to defer the receipt of shares of the Company’s common stock issuable upon vesting until either his or her (i) separation from service with the Company or (ii) attainment of an age specified in advance by the non-management director. A total of five directors elected to defer the receipt of RSUs granted on March 1, 2024 to a future date, and a total of four directors elected to defer the receipt of RSUs granted on March 1, 2023 to a future date.

RSUs outstanding under the 2009 Plan as of March 31, 2024, and changes during the three-month period following December 31, 2023, was as follows:

 

 

 

 

 

 

Weighted-

 

 

 

 

 

 

Average Grant

 

 

 

Shares

 

 

Date Fair Value

 

Unvested at December 31, 2023

 

 

775,926

 

 

$

6.86

 

Granted

 

 

844,950

 

 

 

2.87

 

Vested

 

 

(129,384

)

 

 

7.78

 

Forfeited

 

 

 

 

 

 

Unvested at March 31, 2024

 

 

1,491,492

 

 

 

4.52

 

 

3. ACQUISITIONS AND DIVESTITURES

Acquisitions

The Company accounts for all transactions that represent business combinations using the acquisition method of accounting, where the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity are recognized and measured at their fair values on the date the Company obtains control in the acquiree. Such fair values that are not finalized for reporting periods following the acquisition date are estimated and recorded as provisional amounts. Adjustments to these provisional amounts during the measurement period (defined as the date through which all information required to identify and measure the consideration transferred, the assets acquired, the liabilities assumed and any noncontrolling interests has been obtained, limited to one year from the acquisition date) are recorded when identified. Goodwill is determined as the excess of the fair value of the consideration conveyed in the acquisition over the fair value of the net assets acquired.

11


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

The Company accounts for asset acquisitions pursuant to a cost accumulation model. Direct transaction costs are recognized as part of the cost of an acquisition. The Company also evaluates which elements of a transaction should be accounted for as part of an asset acquisition and which should be accounted for separately. The cost of an asset acquisition, including transaction costs, is allocated to identifiable assets acquired and liabilities assumed based on a relative fair value basis. Goodwill is not recognized in an asset acquisition.

During the three months ended March 31, 2024, one or more subsidiaries of the Company paid approximately $1 million to acquire the operating assets and related businesses of certain physician practices and clinics that operate within the communities served by the Company’s affiliated hospitals. The purchase price for these transactions was primarily allocated to working capital and property and equipment.

Divestitures

There were no hospital divestitures completed during the three months ended March 31, 2024. The following table provides a summary of hospitals that the Company divested (or, in the case of Lutheran Rehabilitation Hospital, in which the Company sold a majority interest) during the year ended December 31, 2023:

 

 

 

 

 

 

 

Licensed

 

 

Hospital

 

Buyer

 

City, State

 

Beds

 

Effective Date

2023 Divestitures:

 

 

 

 

 

 

 

 

Greenbrier Valley Medical Center

 

Vandalia Health, Inc.

 

Ronceverte, WV

 

122

 

January 1, 2023

Plateau Medical Center

 

Vandalia Health, Inc.

 

Oak Hill, WV

 

25

 

April 1, 2023

Medical Center of South Arkansas

 

SARH Holdings, Inc.

 

El Dorado, AR

 

166

 

July 1, 2023

Lutheran Rehabilitation Hospital

 

Select Medical Corporation

 

Fort Wayne, IN

 

36

 

September 1, 2023

AllianceHealth Ponca City

 

Integris Health

 

Ponca City, OK

 

140

 

November 1, 2023

AllianceHealth Woodward

 

Integris Health

 

Woodward, OK

 

87

 

November 1, 2023

Bravera Health Brooksville

 

Tampa General Hospital

 

Brooksville, FL

 

120

 

December 1, 2023

Bravera Health Spring Hill

 

Tampa General Hospital

 

Spring Hill, FL

 

124

 

December 1, 2023

Bravera Health Seven Rivers

 

Tampa General Hospital

 

Crystal River, FL

 

128

 

December 1, 2023

On February 28, 2023, the Company entered into a definitive agreement for the sale of substantially all of the assets of Lake Norman Regional Medical Center (123 licensed beds) in Mooresville, North Carolina, and Davis Regional Medical Center (144 licensed beds) in Statesville, North Carolina, to Novant Health, Inc. In January 2024, the Federal Trade Commission filed a complaint for temporary restraining order and preliminary injunction in the United States District Court for the Western District of North Carolina seeking to enjoin the consummation of the aforementioned sale of Lake Norman Regional Medical Center and Davis Regional Medical Center to Novant Health, Inc. The administrative merits hearing on such matter is scheduled to begin on May 1, 2024. These hospitals were classified as held-for-sale as of March 31, 2024.

The following table discloses amounts included in the condensed consolidated balance sheets for the hospitals classified as held-for-sale as of March 31, 2024 and December 31, 2023 (in millions). Other assets, net, primarily includes the net property and equipment and goodwill for the hospitals held-for-sale. No divestitures or potential divestitures meet the criteria for reporting as a discontinued operation as of March 31, 2024 or December 31, 2023.

 

 

 

March 31,
2024

 

 

December 31,
2023

 

Other current assets

 

$

6

 

 

$

6

 

Other assets, net

 

 

219

 

 

 

218

 

Accrued liabilities

 

 

(13

)

 

 

(13

)

 

12


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

 

4. GOODWILL

The changes in the carrying amount of goodwill for the three months ended March 31, 2024 are as follows (in millions):

 

Balance, as of December 31, 2023

 

 

 

Goodwill

 

$

6,772

 

Accumulated impairment losses

 

 

(2,814

)

 

 

3,958

 

Goodwill acquired as part of acquisitions during current year

 

 

 

Goodwill allocated to hospitals divested or held-for-sale

 

 

(1

)

Balance, as of March 31, 2024

 

 

 

Goodwill

 

 

6,771

 

Accumulated impairment losses

 

 

(2,814

)

 

$

3,957

 

 

Goodwill is allocated to each identified reporting unit, which is defined as an operating segment or one level below the operating segment (referred to as a component of the entity). Management has determined that the Company’s operating segment meets the criteria to be classified as a reporting unit.

Goodwill is evaluated for impairment annually and when an event occurs or circumstances change that, more likely than not, reduce the fair value of the reporting unit below its carrying value. The Company performed its last annual goodwill impairment evaluation during the fourth quarter of 2023 using an October 31, 2023 measurement date, which indicated no impairment.

The determination of fair value in the Company’s goodwill impairment analysis is based on an estimate of fair value for the reporting unit utilizing known and estimated inputs at the evaluation date. Some of those inputs include, but are not limited to, the most recent price of the Company’s common stock and fair value of long-term debt, the Company’s recent financial results, estimates of future revenue and expense growth, estimated market multiples, expected capital expenditures, income tax rates, costs of invested capital and a discount rate.

Future estimates of fair value could be adversely affected if the actual outcome of one or more of the assumptions described above changes materially in the future, including as a result of any decline in the Company’s stock price and the fair value of its long-term debt, an increase in the volatility of the Company’s stock price and the fair value of its long-term debt, lower-than-expected hospital volumes and/or net operating revenues, higher market interest rates, increased operating costs or other adverse impacts on the Company’s financial results. Such changes impacting the calculation of fair value could result in a material impairment charge in the future.

 

5. INCOME TAXES

The total amount of unrecognized benefit that would affect the effective tax rate, if recognized, was $45 million at March 31, 2024. A total of $3 million of interest and penalties is included in the amount of the liability for uncertain tax positions at March 31, 2024. It is the Company’s policy to recognize interest and penalties related to unrecognized benefits in its condensed consolidated statements of loss as income tax expense.

It is possible the amount of unrecognized tax benefit could change in the next 12 months as a result of a lapse of the statute of limitations and settlements with taxing authorities; however, the Company does not anticipate the change will have a material impact on the Company’s condensed consolidated results of operations or financial position.

The Company’s income tax return for the 2018 tax year remains under examination by the Internal Revenue Service. The Company believes the result of this examination will not be material to its consolidated results of operations or consolidated financial position. The Company has extended the federal statute of limitations through June 30, 2025 for Community Health Systems, Inc. for the tax period ended December 31, 2018.

13


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

The Company’s provision for income taxes was $28 million and $26 million for the three months ended March 31, 2024 and 2023, respectively. The Company’s effective tax rates were 127.3% and 433.3% for the three months ended March 31, 2024 and 2023, respectively. The increase in the provision for income taxes and the difference in the Company's effective tax rate for the three months ended March 31, 2024, compared to the same period in 2023 was primarily due to an increase in income before income taxes.

Cash paid for income taxes, net of refunds received, resulted in a net payment of less than $1 million during both of the three-month periods ended March 31, 2024 and 2023.

6. LONG-TERM DEBT

Long-term debt, net of unamortized debt issuance costs and discounts or premiums, consists of the following (in millions):

 

 

 

March 31,

 

 

December 31,

 

 

 

2024

 

 

2023

 

8% Senior Secured Notes due 2026

 

$

1,116

 

 

$

1,116

 

8% Senior Secured Notes due 2027

 

 

700

 

 

 

700

 

5⅝% Senior Secured Notes due 2027

 

 

1,900

 

 

 

1,900

 

6⅞% Senior Notes due 2028

 

 

756

 

 

 

756

 

6% Senior Secured Notes due 2029

 

 

644

 

 

 

644

 

5¼% Senior Secured Notes due 2030

 

 

1,535

 

 

 

1,535

 

4¾% Senior Secured Notes due 2031

 

 

1,058

 

 

 

1,058

 

10⅞% Senior Secured Notes due 2032

 

 

1,000

 

 

 

1,000

 

6⅞% Junior-Priority Secured Notes due 2029

 

 

1,244

 

 

 

1,244

 

6⅛% Junior-Priority Secured Notes due 2030

 

 

1,227

 

 

 

1,227

 

ABL Facility

 

 

302

 

 

 

247

 

Finance lease and financing obligations

 

 

366

 

 

 

366

 

Other

 

 

42

 

 

 

32

 

Less: Unamortized deferred debt issuance costs and note premium

 

 

(323

)

 

 

(338

)

Total debt

 

 

11,567

 

 

 

11,487

 

Less: Current maturities

 

 

(34

)

 

 

(21

)

Total long-term debt

 

$

11,533

 

 

$

11,466

 

 

Pursuant to the asset-based loan (ABL) credit agreement, the lenders have extended to CHS/Community Health Systems, Inc. (“CHS”) a revolving asset-based loan facility (the “ABL Facility”). The maximum aggregate principal amount under the ABL Facility is $1.0 billion, subject to borrowing base capacity. At March 31, 2024, the Company had outstanding borrowings of $302 million and approximately $618 million of additional borrowing capacity (after taking into consideration the $67 million of outstanding letters of credit) under the ABL Facility. The issued letters of credit were primarily in support of potential insurance-related claims and certain bonds. Letters of credit were reduced during the three months ended March 31, 2024 by $14 million, primarily in relation to a professional liability claim that was settled and funded during the three months ended March 31, 2024.

The ABL Facility contains customary representations and warranties, subject to limitations and exceptions, and customary covenants restricting the Company’s ability, subject to certain exceptions, to, among other things (1) declare dividends, make distributions or redeem or repurchase capital stock, (2) prepay, redeem or repurchase other debt, (3) incur liens or grant negative pledges, (4) make loans and investments and enter into acquisitions and joint ventures, (5) incur additional indebtedness or provide certain guarantees, (6) engage in mergers, acquisitions and asset sales, (7) conduct transactions with affiliates, (8) alter the nature of the Company’s, CHS’ or the guarantors’ businesses, (9) grant certain guarantees with respect to physician practices, (10) engage in sale and leaseback transactions or (11) change the Company’s fiscal year. The Company is also required to comply with a consolidated fixed coverage ratio, upon certain triggering events described below, and various affirmative covenants. The consolidated fixed charge coverage ratio is calculated as the ratio of (x) consolidated EBITDA (as defined in the ABL Facility) less capital expenditures to (y) the sum of consolidated interest expense (as defined in the ABL Facility), scheduled principal payments, income taxes and restricted payments made in cash or in permitted investments. For purposes of calculating the consolidated fixed charge coverage ratio, the calculation of consolidated EBITDA as defined in the ABL Facility is a trailing 12-month calculation that begins with the Company’s consolidated net income, with certain adjustments for interest, taxes, depreciation and amortization, net income attributable to noncontrolling interests, stock compensation expense, restructuring costs, and the financial impact of other non-cash or non-recurring items recorded during any such 12-month period. The consolidated fixed charge coverage ratio is a required covenant only in periods where the total borrowings outstanding under the ABL Facility reduce the amount available in the facility to less than the greater of (i) $95 million or (ii) 10% of the calculated borrowing base. As a result, in the event the Company has less than $95

14


COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (continued)

 

million available under the ABL Facility, the Company would need to comply with the consolidated fixed charge coverage ratio. At March 31, 2024, the Company is not subject to the consolidated fixed charge coverage ratio as such triggering event had not occurred during the twelve months ended March 31, 2024.

The Company paid interest of $149 million and $197 million on borrowings during the three months ended March 31, 2024 and 2023, respectively.

7. FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair value of financial instruments has been estimated by the Company using available market information as of March 31, 2024 and December 31, 2023, and valuation methodologies considered appropriate. The estimates presented in the table below are not necessarily indicative of amounts the Company could realize in a current market exchange (in millions):

 

 

 

March 31, 2024

 

 

December 31, 2023

 

 

 

Carrying

 

 

Estimated
Fair

 

 

Carrying

 

 

Estimated
Fair

 

 

 

Amount

 

 

Value

 

 

Amount

 

 

Value

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

48

 

 

$

48

 

 

$

38

 

 

$

38

 

Investments in equity securities

 

 

65

 

 

 

65

 

 

 

69

 

 

 

69

 

Available-for-sale debt securities

 

 

178

 

 

 

178

 

 

 

182

 

 

 

182

 

Trading securities

 

 

5

 

 

 

5

 

 

 

5

 

 

 

5

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

8% Senior Secured Notes due 2026

 

 

1,110

 

 

 

1,114

 

 

 

1,109

 

 

 

1,114

 

8% Senior Secured Notes due 2027

 

 

695

 

 

 

688

 

 

 

695

 

 

 

679

 

5⅝% Senior Secured Notes due 2027

 

 

1,851

 

 

 

1,751

 

 

 

1,847

 

 

 

1,767

 

6⅞% Senior Notes due 2028

 

 

750

 

 

 

534

 

 

 

750

 

 

 

470

 

6% Senior Secured Notes due 2029

 

 

623

 

 

 

562

 

 

 

622

 

 

 

580

 

5¼% Senior Secured Notes due 2030

 

 

1,460

 

 

 

1,253

 

 

 

1,458

 

 

 

1,287

 

4¾% Senior Secured Notes due 2031

 

 

1,054

 

 

 

818

 

 

 

1,054

 

 

 

834

 

10⅞% Senior Secured Notes due 2032

 

 

982

 

 

 

1,031

 

 

 

982

 

 

 

1,047

 

6⅞% Junior-Priority Secured Notes due 2029

 

 

1,165

 

 

 

934

 

 

 

1,162

 

 

 

812

 

6⅛% Junior-Priority Secured Notes due 2030

 

 

1,169

 

 

 

885