##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 Quarterly Report Pursuant to Section 13 or 15(d) 
of the Securities Exchange Act of 1934
 For the Quarterly Period Ended September 30, 2009
 Commission File Number 000-22217
 AMSURG CORP.
 (Exact Name of Registrant as Specified in its Charter)
 Tennessee(State or other jurisdiction of 
incorporation or organization)
    
    62-1493316(I.R.S. Employer
Identification No.)20 Burton Hills BoulevardNashville, TN
    
    37215(Address of principal executive offices)
    
    (Zip code)
 (615) 665-1283  (Registrants Telephone Number, Including Area Code)
  þ o
  o o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o
  o þ




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##### 



Table of Contents to Form 10-Q for the Nine Months Ended September 30, 2009
 Part IItem 1. Financial Statements
    
    
    1Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    22Item 4. Controls and Procedures
    
    
    22Item 4T. Controls and Procedures
    
    
    22Part IIItem 1. Legal Proceedings
    
    
    23Item 1A. Risk Factors
    
    
    23Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    23Item 3. Defaults Upon Senior Securities
    
    
    23Item 4. Submission of Matters to a Vote of Security Holders
    
    
    23Item 5. Other Information
    
    
    23Item 6. Exhibits
    
    
    24Signature
    
    
    25EX-10.1EX-31.1EX-31.2EX-32.1




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##### Table of Contents



Part I
 
 Item 1. Financial Statements
 AmSurg Corp.
Consolidated Balance Sheets
September 30, 2009 (unaudited) and December 31, 2008
(Dollars in thousands)
 September 30,
    
    
    December 31,2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    30,646
    
    
    $
    31,548Accounts receivable, net of allowance of $11,724 and $11,757, respectively
    
    
    66,647
    
    
    
    63,602Supplies inventory
    
    
    7,811
    
    
    
    8,083Deferred income taxes
    
    
    1,666
    
    
    
    1,378Prepaid and other current assets
    
    
    13,640
    
    
    
    17,223Current assets held for sale
    
    
    115
    
    
    
    25Total current assets
    
    
    120,525
    
    
    
    121,859Long-term receivables and other assets
    
    
    58
    
    
    
    46Property and equipment, net
    
    
    109,271
    
    
    
    111,884Goodwill
    
    
    694,067
    
    
    
    661,693Intangible assets, net
    
    
    9,896
    
    
    
    10,221Long-term assets held for sale
    
    
    640
    
    
    
    176Total assets
    
    $
    934,457
    
    
    $
    905,879Liabilities and EquityCurrent liabilities:Current portion of long-term debt
    
    $
    5,341
    
    
    $
    6,801Accounts payable
    
    
    10,961
    
    
    
    14,240Accrued salaries and benefits
    
    
    19,272
    
    
    
    12,040Other accrued liabilities
    
    
    3,309
    
    
    
    3,246Current liabilities held for sale
    
    
    283
    
    
    
    35Total current liabilities
    
    
    39,166
    
    
    
    36,362Long-term debt
    
    
    232,792
    
    
    
    265,835Deferred income taxes
    
    
    67,354
    
    
    
    54,758Other long-term liabilities
    
    
    22,105
    
    
    
    22,416Other long-term liabilities held for sale
    
    
    35
    
    
    
    Commitments and contingenciesNoncontrolling interests  redeemable
    
    
    76,096
    
    
    
    63,202Preferred stock, no par value, 5,000,000 shares authorized, no shares issued or outstanding
    
    
    
    
    
    
    Equity:Common stock, no par value, 70,000,000 shares authorized, 30,670,843 and 31,342,241
shares outstanding, respectively
    
    
    162,806
    
    
    
    172,192Retained earnings
    
    
    331,087
    
    
    
    291,088Accumulated other comprehensive loss, net of income taxes
    
    
    (2,151
    )
    
    
    (2,851
    )Total AmSurg Corp. shareholders equity
    
    
    491,742
    
    
    
    460,429Noncontrolling interests  non-redeemable
    
    
    5,167
    
    
    
    2,877Total equity
    
    
    496,909
    
    
    
    463,306Total liabilities and equity
    
    $
    934,457
    
    
    $
    905,879
  1




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Consolidated Statements of Earnings (unaudited)
Three Months and Nine Months Ended September 30, 2009 and 2008
(In thousands, except earnings per share
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Revenues
    
    $
    167,873
    
    
    $
    150,749
    
    
    $
    500,141
    
    
    $
    447,050Operating expenses:Salaries and benefits
    
    
    51,328
    
    
    
    44,206
    
    
    
    149,708
    
    
    
    130,133Supply cost
    
    
    20,365
    
    
    
    17,351
    
    
    
    61,198
    
    
    
    51,939Other operating expenses
    
    
    33,660
    
    
    
    31,352
    
    
    
    102,082
    
    
    
    91,804Depreciation and amortization
    
    
    5,743
    
    
    
    5,252
    
    
    
    17,092
    
    
    
    15,569Total operating expenses
    
    
    111,096
    
    
    
    98,161
    
    
    
    330,080
    
    
    
    289,445Operating income
    
    
    56,777
    
    
    
    52,588
    
    
    
    170,061
    
    
    
    157,605Interest expense
    
    
    1,921
    
    
    
    2,331
    
    
    
    5,986
    
    
    
    7,626Earnings from continuing operations before income taxes
    
    
    54,856
    
    
    
    50,257
    
    
    
    164,075
    
    
    
    149,979Income tax expense
    
    
    8,944
    
    
    
    8,017
    
    
    
    26,855
    
    
    
    24,327Net earnings from continuing operations, net of income tax expense
    
    
    45,912
    
    
    
    42,240
    
    
    
    137,220
    
    
    
    125,652Discontinued operations:(Loss) earnings from operations of discontinued interests in
surgery centers, net of income tax (benefit) expense
    
    
    (1
    )
    
    
    (207
    )
    
    
    122
    
    
    
    251Gain (loss) on disposal of discontinued interests in surgery
centers, net of income tax expense (benefit)
    
    
    411
    
    
    
    674
    
    
    
    148
    
    
    
    (635
    )Net gain (loss) from discontinued operations
    
    
    410
    
    
    
    467
    
    
    
    270
    
    
    
    (384
    )Net earnings
    
    
    46,322
    
    
    
    42,707
    
    
    
    137,490
    
    
    
    125,268Less net earnings attributable to noncontrolling interests:Net earnings from continuing operations
    
    
    32,519
    
    
    
    29,645
    
    
    
    97,416
    
    
    
    88,991Net earnings from discontinued operations
    
    
    
    
    
    
    678
    
    
    
    75
    
    
    
    943Total net earnings attributable to noncontrolling interests
    
    
    32,519
    
    
    
    30,323
    
    
    
    97,491
    
    
    
    89,934Net earnings attributable to AmSurg Corp. common shareholders
    
    $
    13,803
    
    
    $
    12,384
    
    
    $
    39,999
    
    
    $
    35,334Amounts attributable to AmSurg Corp. common shareholders:Earnings from continuing operations, net of tax
    
    $
    13,393
    
    
    $
    12,595
    
    
    $
    39,804
    
    
    $
    36,661Discontinued operations, net of tax
    
    
    410
    
    
    
    (211
    )
    
    
    195
    
    
    
    (1,327
    )Net earnings attributable to AmSurg Corp. common shareholders
    
    $
    13,803
    
    
    $
    12,384
    
    
    $
    39,999
    
    
    $
    35,334Earnings per share-basic:Net earnings from continuing operations attributable to
AmSurg Corp. common shareholders
    
    $
    0.44
    
    
    $
    0.40
    
    
    $
    1.30
    
    
    $
    1.16Net gain (loss) from discontinued operations attributable to
AmSurg Corp. common shareholders
    
    
    0.01
    
    
    
    (0.01
    )
    
    
    0.01
    
    
    
    (0.04
    )Net earnings attributable to AmSurg Corp. common shareholders
    
    $
    0.46
    
    
    $
    0.39
    
    
    $
    1.30
    
    
    $
    1.12Earnings per share-diluted:Net earnings from continuing operations attributable to
AmSurg Corp. common shareholders
    
    $
    0.44
    
    
    $
    0.39
    
    
    $
    1.29
    
    
    $
    1.15Net gain (loss) from discontinued operations attributable to
AmSurg Corp. common shareholders
    
    
    0.01
    
    
    
    (0.01
    )
    
    
    0.01
    
    
    
    (0.04
    )Net earnings attributable to AmSurg Corp. common shareholders
    
    $
    0.45
    
    
    $
    0.38
    
    
    $
    1.29
    
    
    $
    1.10Weighted average number of shares and share equivalents outstanding:Basic
    
    
    30,195
    
    
    
    31,719
    
    
    
    30,699
    
    
    
    31,499Diluted
    
    
    30,528
    
    
    
    32,303
    
    
    
    30,921
    
    
    
    32,018
  2




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Consolidated Statements of Comprehensive Income (unaudited)
Three Months and Nine Months Ended September 30, 2009 and 2008
(In thousands
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net earnings
    
    $
    46,322
    
    
    $
    42,707
    
    
    $
    137,490
    
    
    $
    125,268Other comprehensive income, net of tax:Unrealized gain (loss) on interest rate swap, net of tax
    
    
    150
    
    
    
    (39
    )
    
    
    700
    
    
    
    5Comprehensive income, net of tax
    
    
    46,472
    
    
    
    42,668
    
    
    
    138,190
    
    
    
    125,273Less comprehensive income attributable to noncontrolling interests
    
    
    32,519
    
    
    
    30,323
    
    
    
    97,491
    
    
    
    89,934Comprehensive income attributable to AmSurg Corp. common
shareholders
    
    $
    13,953
    
    
    $
    12,345
    
    
    $
    40,699
    
    
    $
    35,339
  3




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Consolidated Statements of Changes in Equity
Nine Months Ended September 30, 2009 and 2008 (unaudited)
(In thousands
 Non-AmSurg Corp. Shareholders
    
    
    Non-
    
    
    
    
    
    
    ControllingAccumulated
    
    
    Controlling
    
    
    
    
    
    
    Interests Other
    
    
    Interests 
    
    
    Total
    
    
    RedeemableCommon Stock
    
    
    Retained
    
    
    Comprehensive
    
    
    Non-
    
    
    Equity
    
    
    (Temporary
    
    
    NetShares
    
    
    Amount
    
    
    Earnings
    
    
    Loss
    
    
    Redeemable
    
    
    (Permanent)
    
    
    Equity)
    
    
    EarningsBalance at
December 31, 2008
    
    
    31,342
    
    
    $
    172,192
    
    
    $
    291,088
    
    
    $
    (2,851
    )
    
    $
    2,877
    
    
    $
    463,306
    
    
    $
    63,202Issuance of restricted
common stock
    
    
    162
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancellation of restricted
common stock
    
    
    (14
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock options exercised
    
    
    12
    
    
    
    178
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    178
    
    
    
    Stock repurchased
    
    
    (831
    )
    
    
    (12,587
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,587
    )
    
    
    Share-based compensation
    
    
    
    
    
    
    3,102
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,102
    
    
    
    Tax benefit related to
exercise of stock options
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    Net earnings
    
    
    
    
    
    
    
    
    
    
    39,999
    
    
    
    
    
    
    
    2,987
    
    
    
    42,986
    
    
    
    94,504
    
    
    $
    137,490Distributions to
noncontrolling interests,
net of capital
contributions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,858
    )
    
    
    (2,858
    )
    
    
    (94,246
    )Sale of noncontrolling
interests
    
    
    
    
    
    
    (80
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (80
    )
    
    
    90Acquisitions and other
transactions impacting
noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,161
    
    
    
    2,161
    
    
    
    12,546Gain on interest rate swap,
net of income tax
expense of $451
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    700
    
    
    
    
    
    
    
    700
    
    
    
    Balance at September 30,
2009
    
    
    30,671
    
    
    $
    162,806
    
    
    $
    331,087
    
    
    $
    (2,151
    )
    
    $
    5,167
    
    
    $
    496,909
    
    
    $
    76,096Balance at January 1, 2008
    
    
    31,203
    
    
    $
    168,620
    
    
    $
    244,042
    
    
    $
    (1,437
    )
    
    $
    2,537
    
    
    $
    413,762
    
    
    $
    59,469Issuance of restricted
common stock
    
    
    147
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancellation of restricted
common stock
    
    
    (10
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock options exercised
    
    
    518
    
    
    
    9,935
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,935
    
    
    
    Share-based compensation
    
    
    
    
    
    
    3,701
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,701
    
    
    
    Tax benefit related to
exercise of stock options
    
    
    
    
    
    
    1,316
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,316
    
    
    
    Net earnings
    
    
    
    
    
    
    
    
    
    
    35,334
    
    
    
    
    
    
    
    2,569
    
    
    
    37,903
    
    
    
    87,365
    
    
    $
    125,268Distributions to
noncontrolling interests,
net of capital
contributions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,340
    )
    
    
    (2,340
    )
    
    
    (86,105
    )Acquisitions and other
transactions impacting
noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (53
    )
    
    
    (53
    )
    
    
    1,324Gain on interest rate swap,
net of income tax
expense of $4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    5
    
    
    
    Balance at September 30,
2008
    
    
    31,858
    
    
    $
    183,572
    
    
    $
    279,376
    
    
    $
    (1,432
    )
    
    $
    2,713
    
    
    $
    464,229
    
    
    $
    62,053
  4




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Consolidated Statements of Cash Flows (unaudited)
Nine Months Ended September 30, 2009 and 2008
(In thousands
 Nine Months EndedSeptember 30,2009
    
    
    2008Cash flows from operating activities:Net earnings
    
    $
    137,490
    
    
    $
    125,268Adjustments to reconcile net earnings to net cash flows provided by
operating activities:Depreciation and amortization
    
    
    17,092
    
    
    
    15,569Net loss on sale and impairment of long-lived assets held for sale
    
    
    434
    
    
    
    1,076Share-based compensation
    
    
    3,102
    
    
    
    3,701Excess tax benefit from share-based compensation
    
    
    (27
    )
    
    
    (1,316
    )Deferred income taxes
    
    
    11,240
    
    
    
    10,190Increase (decrease) in cash and cash equivalents, net of effects of
acquisitions and dispositions, due to changes in:Accounts receivable, net
    
    
    (2,102
    )
    
    
    (3,063
    )Supplies inventory
    
    
    376
    
    
    
    16Prepaid and other current assets
    
    
    1,021
    
    
    
    1,972Accounts payable
    
    
    (944
    )
    
    
    (1,765
    )Accrued expenses and other liabilities
    
    
    8,138
    
    
    
    2,416Other, net
    
    
    248
    
    
    
    111Net cash flows provided by operating activities
    
    
    176,068
    
    
    
    154,175Cash flows from investing activities:Acquisition of interests in surgery centers and related transactions
    
    
    (19,705
    )
    
    
    (42,810
    )Acquisition of property and equipment
    
    
    (16,509
    )
    
    
    (13,565
    )Proceeds from sale of surgery centers
    
    
    898
    
    
    
    3,753Repayment of notes receivable
    
    
    1,666
    
    
    
    1,459Net cash flows used in investing activities
    
    
    (33,650
    )
    
    
    (51,163
    )Cash flows from financing activities:Proceeds from long-term borrowings
    
    
    52,459
    
    
    
    57,771Repayment on long-term borrowings
    
    
    (87,049
    )
    
    
    (87,653
    )Distributions to noncontrolling interests
    
    
    (97,195
    )
    
    
    (88,993
    )Proceeds from issuance of common stock upon exercise of stock options
    
    
    178
    
    
    
    9,935Repurchase of common stock
    
    
    (12,587
    )
    
    
    Capital contributions and ownership transactions by noncontrolling interests
    
    
    858
    
    
    
    548Excess tax benefit from share-based compensation
    
    
    27
    
    
    
    1,316Financing cost incurred
    
    
    (11
    )
    
    
    (32
    )Net cash flows used in financing activities
    
    
    (143,320
    )
    
    
    (107,108
    )Net decrease in cash and cash equivalents
    
    
    (902
    )
    
    
    (4,096
    )Cash and cash equivalents, beginning of period
    
    
    31,548
    
    
    
    29,953Cash and cash equivalents, end of period
    
    $
    30,646
    
    
    $
    25,857
  5




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements
 (1) Basis of Presentation
  Consolidations
      6




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
   (2) Use of Estimates
   (3) Revenue Recognition
  .
 (4) Acquisitions and Dispositions
 Business Combinations
  7




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
  Accounts receivable
    
    $
    766Prepaid and other current assets
    
    
    81Property and equipment
    
    
    617Accounts payable
    
    
    (131
    )Goodwill (approximately $18,400 deductible for tax purposes)
    
    
    33,279Total fair value
    
    
    34,612Less: Fair value attributable to noncontrolling interests
    
    
    14,907Acquisition date fair value of total consideration transferred
    
    $
    19,705
    Nine Months EndedSeptember 30, 2009Revenues
    
    $
    6,882Net earnings
    
    $
    2,389Less: Net earnings attributable to noncontrolling interests
    
    
    1,448Net earnings attributable to AmSurg Corp. common shareholders
    
    $
    941
  2009
    
    
    2008Revenues
    
    $
    501,512
    
    
    $
    503,687Net earnings
    
    
    137,593
    
    
    
    140,297Amounts attributable to AmSurg Corp. common shareholders:Net earnings from continuing operations
    
    
    39,753
    
    
    
    40,650Net earnings
    
    
    39,948
    
    
    
    39,323Net earnings from continuing operations per common share:Basic
    
    $
    1.29
    
    
    $
    1.29Diluted
    
    $
    1.29
    
    
    $
    1.27Net earnings:Basic
    
    $
    1.30
    
    
    $
    1.25Diluted
    
    $
    1.29
    
    
    $
    1.23Weighted average number of shares and share equivalents:Basic
    
    
    30,699
    
    
    
    31,499Diluted
    
    
    30,921
    
    
    
    32,018
 8




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Revenues
    
    $
    431
    
    
    $
    1,314
    
    
    $
    1,268
    
    
    $
    5,603(Loss) earnings before income taxes
    
    
    (1
    )
    
    
    (251
    )
    
    
    153
    
    
    
    247Net (loss) earnings
    
    
    (1
    )
    
    
    (207
    )
    
    
    122
    
    
    
    251
 (5) Goodwill and Intangible Assets
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Balance, beginning of period
    
    $
    694,752
    
    
    $
    567,580
    
    
    $
    661,693
    
    
    $
    546,915Purchase price allocations
    
    
    (685
    )
    
    
    21,016
    
    
    
    32,764
    
    
    
    43,501Disposals
    
    
    
    
    
    
    (360
    )
    
    
    (390
    )
    
    
    (2,180
    )Balance, end of period
    
    $
    694,067
    
    
    $
    588,236
    
    
    $
    694,067
    
    
    $
    588,236
  September 30, 2009
    
    
    December 31, 2008Gross
    
    
    
    
    
    
    
    
    
    
    GrossCarrying
    
    
    Accumulated
    
    
    
    
    
    
    Carrying
    
    
    AccumulatedAmount
    
    
    Amortization
    
    
    Net
    
    
    Amount
    
    
    Amortization
    
    
    NetDeferred financing cost
    
    $
    2,755
    
    
    $
    (2,236
    )
    
    $
    519
    
    
    $
    2,744
    
    
    $
    (2,018
    )
    
    $
    726Customer and restrictive
covenant agreements
    
    
    3,180
    
    
    
    (1,568
    )
    
    
    1,612
    
    
    
    3,180
    
    
    
    (1,418
    )
    
    
    1,762Total amortizable
intangible assets
    
    $
    5,935
    
    
    $
    (3,804
    )
    
    $
    2,131
    
    
    $
    5,924
    
    
    $
    (3,436
    )
    
    $
    2,488
   9




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
 (6) Long-term Debt
  September 30,
    
    
    December 31,2009
    
    
    2008Revolving credit agreement
    
    $
    220,300
    
    
    $
    249,000Other debt
    
    
    13,496
    
    
    
    17,445Capitalized lease arrangements
    
    
    4,337
    
    
    
    6,191238,133
    
    
    
    272,636Less current portion
    
    
    5,341
    
    
    
    6,801Long-term debt
    
    $
    232,792
    
    
    $
    265,835
  (7) Derivative Instruments
 Derivatives and Hedging
  10




---



##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
  Asset Derivatives September 30,
    
    
    Liability Derivatives September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Balance
    
    
    
    
    
    
    Balance
    
    
    
    
    
    
    Balance
    
    
    
    
    
    
    BalanceSheet
    
    
    Fair
    
    
    Sheet
    
    
    Fair
    
    
    Sheet
    
    
    Fair
    
    
    Sheet
    
    
    FairLocation
    
    
    Value
    
    
    Location
    
    
    Value
    
    
    Location
    
    
    Value
    
    
    Location
    
    
    ValueDerivatives designated
as hedging
    
    Other
    
    
    
    
    
    Other
    
    
    
    
    
    Other
    
    
    
    
    
    Otherinstruments under
    
    assets,
    
    
    
    
    
    assets,
    
    
    
    
    
    long-term
    
    
    
    
    
    long-termASC 815
    
    net
    
    $
    
    
    
    net
    
    $
    
    
    
    liabilities
    
    $
    3,539
    
    
    liabilities
    
    $
    2,355
 (8) Shareholders Equity
 a. Common Stock
  b. Stock Incentive Plans
    Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Share-based compensation expense
    
    $
    861
    
    
    $
    1,293
    
    
    $
    3,102
    
    
    $
    3,701Fair value of shares vested
    
    
    517
    
    
    
    697
    
    
    
    4,994
    
    
    
    6,081Cash received from option exercises
    
    
    178
    
    
    
    6,946
    
    
    
    178
    
    
    
    9,935Tax benefit from option exercises
    
    
    28
    
    
    
    1,001
    
    
    
    28
    
    
    
    1,547
   11




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
  WeightedNumber
    
    
    Averageof
    
    
    GrantShares
    
    
    PriceNon-vested shares at December 31, 2008
    
    
    327,751
    
    
    $
    23.83Shares granted
    
    
    161,923
    
    
    
    19.33Shares vested
    
    
    (9,471
    )
    
    
    22.58Shares forfeited
    
    
    (14,205
    )
    
    
    20.39Non-vested shares at September 30, 2009
    
    
    465,998
    
    
    $
    22.40
  WeightedAverageWeighted
    
    
    RemainingNumber
    
    
    Average
    
    
    Contractualof
    
    
    Exercise
    
    
    TermShares
    
    
    Price
    
    
    (in years)Outstanding at December 31, 2008
    
    
    3,275,803
    
    
    $
    22.23
    
    
    
    6.1Options granted
    
    
    
    
    
    
    Options exercised
    
    
    (11,799
    )
    
    
    15.10Options terminated
    
    
    (101,052
    )
    
    
    23.71Outstanding at September 30, 2009 with aggregate intrinsic value of $3,433,000
    
    
    3,162,952
    
    
    $
    22.21
    
    
    
    5.3Vested or expected to vest at September 30, 2009 with aggregate intrinsic value
of $3,429,000
    
    
    3,068,000
    
    
    $
    22.18
    
    
    
    5.2Exercisable at September 30, 2009 with aggregate intrinsic value of $3,406,000
    
    
    2,456,617
    
    
    $
    21.98
    
    
    
    4.6
   Nine Months EndedSeptember 30, 2008Applied assumptions:Expected term/life of options in years
    
    
    5.1Forfeiture rate
    
    
    Average risk-free interest rate
    
    
    2.7
    %Volatility rate
    
    
    31.9
    %Dividends
    
    
    
  12




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
 c. Earnings Per Share
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Per
    
    
    
    
    
    
    
    
    
    
    PerEarnings
    
    
    Shares
    
    
    Share
    
    
    Earnings
    
    
    Shares
    
    
    Share(Numerator)
    
    
    (Denominator)
    
    
    Amount
    
    
    (Numerator)
    
    
    (Denominator)
    
    
    Amount2009:Net earnings from
continuing
operations
attributable to
AmSurg Corp. per
common share
(basic)
    
    $
    13,393
    
    
    
    30,195
    
    
    $
    0.44
    
    
    $
    39,804
    
    
    
    30,699
    
    
    $
    1.30Effect of dilutive securities options
    
    
    
    
    
    
    333
    
    
    
    
    
    
    
    
    
    
    
    222Net earnings from
continuing
operations
attributable to
AmSurg Corp. per
common share
(diluted)
    
    $
    13,393
    
    
    
    30,528
    
    
    $
    0.44
    
    
    $
    39,804
    
    
    
    30,921
    
    
    $
    1.29Net earnings
attributable to
AmSurg Corp. per
common share
(basic)
    
    $
    13,803
    
    
    
    30,195
    
    
    $
    0.46
    
    
    $
    39,999
    
    
    
    30,699
    
    
    $
    1.30Effect of dilutive securities options
    
    
    
    
    
    
    333
    
    
    
    
    
    
    
    
    
    
    
    222Net earnings
attributable to
AmSurg Corp. per
common share
(diluted)
    
    $
    13,803
    
    
    
    30,528
    
    
    $
    0.45
    
    
    $
    39,999
    
    
    
    30,921
    
    
    $
    1.292008:Net earnings from
continuing
operations
attributable to
AmSurg Corp. per
common share
(basic)
    
    $
    12,595
    
    
    
    31,719
    
    
    $
    0.40
    
    
    $
    36,661
    
    
    
    31,499
    
    
    $
    1.16Effect of dilutive securities options
    
    
    
    
    
    
    584
    
    
    
    
    
    
    
    
    
    
    
    519Net earnings from
continuing
operations
attributable to
AmSurg Corp. per
common share
(diluted)
    
    $
    12,595
    
    
    
    32,303
    
    
    $
    0.39
    
    
    $
    36,661
    
    
    
    32,018
    
    
    $
    1.15Net earnings
attributable to
AmSurg Corp. per
common share
(basic)
    
    $
    12,384
    
    
    
    31,719
    
    
    $
    0.39
    
    
    $
    35,334
    
    
    
    31,499
    
    
    $
    1.12Effect of dilutive securities options
    
    
    
    
    
    
    584
    
    
    
    
    
    
    
    
    
    
    
    519Net earnings
attributable to
AmSurg Corp. per
common share
(diluted)
    
    $
    12,384
    
    
    
    32,303
    
    
    $
    0.38
    
    
    $
    35,334
    
    
    
    32,018
    
    
    $
    1.10
 13




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
 (9) Fair Value Measurements
    Fair Value Measurements atReporting Date Using:Quoted Pricesin Active
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantSeptember 30,
    
    
    Identical
    
    
    Observable
    
    
    Unobservable2009
    
    
    Assets
    
    
    Inputs
    
    
    InputsAssets:Supplemental executive
retirement savings plan
investments
    
    $
    4,366
    
    
    $
    
    
    
    $
    4,366
    
    
    $
    Liabilities:Supplemental executive
retirement savings plan
obligations
    
    $
    4,332
    
    
    $
    
    
    
    $
    4,332
    
    
    $
    Interest rate swap agreement
    
    
    3,539
    
    
    
    
    
    
    
    3,539
    
    
    
    Total liabilities
    
    $
    7,871
    
    
    $
    
    
    
    $
    7,871
    
    
    $
    
  (10) Income Taxes
   (11) Commitments and Contingencies
   14




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##### Table of Contents



Item 1. Financial Statements  (continued)
 AmSurg Corp.
Notes to the Unaudited Consolidated Financial Statements  (continued)
  (12) Recent Accounting Pronouncements
 Financial Instruments
 Subsequent Events
  Measuring Liabilities at Fair Value Fair Value Measurements and Disclosures
 (13) Supplemental Cash Flow Information
  Nine Months EndedSeptember 30,2009
    
    
    2008Cash paid during the period for:Interest
    
    $
    5,962
    
    
    $
    7,878Income taxes, net of refunds
    
    
    14,048
    
    
    
    14,934Non-cash investing and financing activities:Decrease in accounts payable associated with acquisition
of property and equipment
    
    
    (2,752
    )
    
    
    (102
    )Capital lease obligations incurred to acquire equipment
    
    
    148
    
    
    
    389Effect of acquisitions and related transactions:Assets acquired, net of cash and adjustments
    
    
    35,651
    
    
    
    48,565Liabilities assumed and noncontrolling interests
    
    
    (15,946
    )
    
    
    5,755Payment for interests in surgery centers and related transactions
    
    $
    19,705
    
    
    $
    42,810
 (14) Subsequent Events
  15




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward-Looking Statements
   
    
    adverse impacts on our business associated with current and future economic conditions;
 
    
    the risk that payments from third-party payors, including government healthcare
programs, may decrease or not increase as our costs increase;
 
    
    adverse developments affecting the medical practices of our physician partners;
 
    
    our ability to maintain favorable relations with our physician partners;
 
    
    our ability to acquire and develop additional surgery centers on favorable terms;
 
    
    our ability to grow revenues by increasing procedure volume while maintaining operating
margins and profitability at our existing centers;
 
    
    our ability to manage the growth in our business;
 
    
    our ability to obtain sufficient capital resources to complete acquisitions and develop
new surgery centers;
 
    
    our ability to compete for physician partners, managed care contracts, patients and
strategic relationships;
 
    
    adverse weather and other factors beyond our control that may affect our surgery
centers;
 
    
    our failure to comply with applicable laws and regulations;
 
    
    the risk of changes in legislation, regulations or regulatory interpretations that may
negatively affect us;
 
    
    the risk of becoming subject to federal and state investigation;
 
    
    the risk of regulatory changes that may obligate us to buy out the ownership interests
of physicians who are minority owners of our surgery centers;
 
    
    potential liabilities associated with our status as a general partner of limited
partnerships;
 
    
    liabilities for claims brought against our facilities;
 
    
    our legal responsibility to minority owners of our surgery centers, which may conflict
with our interests and prevent us from acting solely in our best interests;
 
    
    risks associated with the potential write-off of the impaired portion of intangible
assets; and
 
    
    potential liabilities relating to the tax deductibility of goodwill.
 16




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
 Overview
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Procedures
    
    
    310,676
    
    
    
    279,537
    
    
    
    927,499
    
    
    
    825,702Continuing centers in operation, end of period
    
    
    194
    
    
    
    175
    
    
    
    194
    
    
    
    175Average number of continuing centers in operation, during period
    
    
    194
    
    
    
    173
    
    
    
    192
    
    
    
    171New centers added during period
    
    
    1
    
    
    
    3
    
    
    
    6
    
    
    
    7Centers disposed during period
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (5
    )Centers under development, end of period
    
    
    2
    
    
    
    3
    
    
    
    2
    
    
    
    3Centers held for sale, end of period
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )Centers under letter of intent, end of period
    
    
    2
    
    
    
    13
    
    
    
    2
    
    
    
    13
   Sources of Revenues
    
    
    ASCs are paid based upon a percentage of the payments to hospital outpatient departments
pursuant to the hospital outpatient prospective payment system;
 
    
    a scheduled phase in of the revised rates over four years, beginning January 1, 2008;
and
 
    
    planned annual increases in the ASC rates beginning in 2010 based on the consumer price
index, or CPI.
   17




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
     Critical Accounting Policies
  Results of Operations
    Consolidations
  18




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
     Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Operating expenses:Salaries and benefits
    
    
    30.6
    
    
    
    29.3
    
    
    
    30.0
    
    
    
    29.1Supply cost
    
    
    12.1
    
    
    
    11.5
    
    
    
    12.2
    
    
    
    11.6Other operating expenses
    
    
    20.1
    
    
    
    20.8
    
    
    
    20.4
    
    
    
    20.5Depreciation and amortization
    
    
    3.4
    
    
    
    3.5
    
    
    
    3.4
    
    
    
    3.5Total operating expenses
    
    
    66.2
    
    
    
    65.1
    
    
    
    66.0
    
    
    
    64.7Operating income
    
    
    33.8
    
    
    
    34.9
    
    
    
    34.0
    
    
    
    35.3Interest expense
    
    
    1.1
    
    
    
    1.6
    
    
    
    1.2
    
    
    
    1.8Earnings from continuing operations before income taxes
    
    
    32.7
    
    
    
    33.3
    
    
    
    32.8
    
    
    
    33.5Income tax expense
    
    
    5.3
    
    
    
    5.3
    
    
    
    5.4
    
    
    
    5.4Net earnings from continuing operations, net of income
tax expense
    
    
    27.4
    
    
    
    28.0
    
    
    
    27.4
    
    
    
    28.1Discontinued operations:(Loss) earnings from operations of discontinued
interests in surgery centers, net of income tax
(benefit) expense
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    (Gain) loss on disposal of discontinued interests in
surgery centers, net of income tax expense (benefit)
    
    
    0.2
    
    
    
    0.4
    
    
    
    0.1
    
    
    
    (0.1
    )Net gain (loss) from discontinued operations
    
    
    0.2
    
    
    
    0.3
    
    
    
    0.1
    
    
    
    (0.1
    )Net earnings
    
    
    27.6
    
    
    
    28.3
    
    
    
    27.5
    
    
    
    28.0Less net earnings attributable to noncontrolling interests:Net earnings from continuing operations
    
    
    19.4
    
    
    
    19.7
    
    
    
    19.5
    
    
    
    19.9Net earnings from discontinued operations
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    0.2Total net earnings attributable to noncontrolling
interests
    
    
    19.4
    
    
    
    20.1
    
    
    
    19.5
    
    
    
    20.1Net earnings attributable to AmSurg Corp. common
shareholders
    
    
    8.2
    %
    
    
    8.2
    %
    
    
    8.0
    %
    
    
    7.9
    %Amounts attributable to AmSurg Corp. common shareholders:Earnings from continuing operations, net of tax
    
    
    8.0
    %
    
    
    8.4
    %
    
    
    8.0
    %
    
    
    8.2
    %Discontinued operations, net of tax
    
    
    0.2
    
    
    
    (0.2
    )
    
    
    
    
    
    
    (0.3
    )Net earnings attributable to AmSurg Corp. common
shareholders
    
    
    8.2
    %
    
    
    8.2
    %
    
    
    8.0
    %
    
    
    7.9
    %
 19




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
  
    
    centers acquired and opened in 2008, which contributed $14.7 million and $47.9 million
of additional revenues in the three and nine months ended September 30, 2009, respectively,
due to having a full period of operations in 2009; and
 
    
    centers acquired and opened in 2009, which generated $2.4 million and $6.0 million in
revenues during the three and nine months ended September 30, 2009, respectively.
    
    
    centers acquired or opened during 2008, which resulted in an increase of $2.5 million
and $8.6 million in other operating expenses in the three and nine months ended September
30, 2009, respectively;
 
    
    an increase of $500,000 and $1.9 million in other operating expenses at our 2009
same-center group in the three and nine months ended September 30, 2009, respectively,
resulting primarily from additional procedure volume and general inflationary cost
increases; and
 
    
    centers acquired and opened during 2009, which resulted in an increase of $500,000 and
$1.1 million in other operating expenses in the three and nine months ended September 30,
2009, respectively.
     20




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
   Liquidity and Capital Resources
    
    
    $19.7 million for acquisitions of interests in ASCs and related transactions;
 
    
    $13.4 million for new or replacement property at existing centers, including $148,000 in
new capital leases; and
 
    
    $3.2 million for centers under development.
     21




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
 Recent Accounting Pronouncements
 Financial Instruments
 Subsequent Events,
  Measuring Liabilities at Fair Value, Fair Value Measurements and
Disclosures
 
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  
 Item 4T. Controls and Procedures
  22




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##### Table of Contents



Part II
 
 Item 1.    Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3.    Defaults Upon Senior Securities
  
 Item 4.    Submission of Matters to a Vote of Security Holders
  
 Item 5.    Other Information
  23




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##### Table of Contents



Item 6.    Exhibits
 Exhibits10.1
    
    
    Amended and Restated 2006 Stock Incentive Plan31.1
    
    
    Certification of President and Chief Executive Officer pursuant to Rule 13a-14(a)31.2
    
    
    Certification of Executive Vice President and Chief Financial Officer pursuant to
Rule 13a-14(a)32.1
    
    
    Section 1350 Certification
 24




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##### Table of Contents



Signature
  AMSURG CORP.Date:      November 6, 2009
    By:
    /s/ Claire M. GulmiClaire M. GulmiExecutive Vice President and
Chief Financial Officer of the Company
(Principal Financial and Duly Authorized Officer) 25