HealthSouth (HLS) Guides FY15 adj.-EPS Above Views; Offers FY16 Outlook

HealthSouth Corporation (the “Company” or “HealthSouth”) will participate in the 34th Annual J.P. Morgan Healthcare Conference in San Francisco, California on January 11-14, 2016. HealthSouth President and Chief Executive Officer, Jay Grinney, will make a presentation on Tuesday, January 12th, at 10:30 a.m. PT/1:30 p.m. ET using the slides attached to this Current Report on Form 8-K as Exhibit 99.1 (the “Conference Slides”) and incorporated herein by reference. The presentation will address, among other things, the Company's strategy and financial performance and discuss industry trends and dynamics. The presentation will be webcast live and will be available at http://investor.healthsouth.com by clicking on an available link.
The Company also has assembled an Investor Reference Book, which is attached to this Current Report on Form 8-K as Exhibit 99.2 (the “Investor Reference Book”). The Investor Reference Book addresses, among other things, an overview of the Company and its industry, it’s business outlook, it’s financial and operational metrics and initiatives, and it’s value proposition. The Investor Reference Book is available at http://investor.healthsouth.com by clicking on an available link.

While the Company has not closed its books for the year ended December 31, 2015, the Company shares its preliminary estimate of net operating revenues and adjusted free cash flow for the year ended December 31, 2015 as well as the amount of common stock repurchases for the three months ended December 31, 2015 in the Conference Slides and Investor Reference Book. In addition, the Company provides pro forma debt and leverage information. The Company reiterates as of the date hereof its Adjusted EBITDA guidance range of $675 million to $685 million for 2015, as previously reported in the Current Report on Form 8-K, dated October 28, 2015, and during the Company’s earnings conference call held on October 29, 2015.

The Company is transitioning from providing guidance on earnings per share, a measure in accordance with generally accepted accounting principles in the United States of America (“GAAP”), to adjusted earnings per share, a non-GAAP measure. An explanation and definition of adjusted earnings per share are provided below. As of the date hereof, the Company reiterates its previously reported earnings per share guidance range and provides the following corresponding adjusted earnings per share guidance range for 2015:

*** The Street sees FY15 EPS of $2.16 and revenue of $3.14 billion and FY16 EPS of $2.55 and revenue of $3.61 billion.

In addition, the Company shares its 2016 guidance considerations, preliminary assumptions around adjusted free cash flow for 2016, and opportunities for deploying its free cash flow in the Conference Slides and Investor Reference Book. While the Company's deployment priorities may shift based on prevailing market conditions, it continues to focus primarily on growth, debt reduction, and shareholder distribution. The Company also provides its updated business model for 2016 through 2018 in the Investor Reference Book. This business model includes a compound annual growth rate for Adjusted EBITDA that continues to have a range of 5% to 9%.

The Company uses “same-store” comparisons to explain the changes in certain performance metrics and line items within its financial statements. Same-store comparisons are calculated based on hospitals open throughout both the full current and prior periods presented. These comparisons include the financial results of market consolidation transactions in existing markets, as it is difficult to determine, with precision, the incremental impact of these transactions on the Company's results of operations.

The information contained herein is being furnished pursuant to Item 7.01 of Form 8-K, “Regulation FD Disclosure.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

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