HCA fourth-quarter profits increase 26 percent; year up 20 percent

Posted 4:21PM on Tuesday 5th February 2002 ( 22 years ago )

NASHVILLE, Tenn. - HCA Inc., the nation's largest for-profit hospital chain, reported on Tuesday higher fourth-quarter earnings, citing increased revenue from same-facility admissions. Nashville-based HCA net earnings equaled $206 million, or 39 cents per share, up from $21 million, or 4 cents per share, in the year ago period. The year-ago figures included $95 million charge for a settlement with the Justice Department over criminal charges the company defrauded federal health care programs, while the 2001 results included a charge of $498 million to settle related civil charges. Excluding those and other one-time charges, fourth-quarter earnings rose to $232 million, or 44 cents per share from $198 million, or 35 cents per share, for the same period a year ago. Thomson Financial/First Call analysts had predicted earnings of 42 cents per share. Revenues were $4.5 billion, up 8.7 percent from $4.2 billion in the fourth quarter of 2000. Same-facility revenue per admission increased 9.8 percent for the quarter, with same-facility admissions growing by 1.8 percent. "The quality of our assets, strong demographic trends in our markets and a focused operational strategy are key to our current, as well as, our future success," chairman and chief executive Jack O. Bovender Jr. said. For the year, HCA reported a 20 percent earnings increase, earning $1.05 billion, or $1.95 a share, compared with $219 million, or 39 cents per share, for all of 2000. Excluding one-time charges, the company earned $1.04 billion, or $1.94 per share. That beat the $1.93 per share expectation of Thomson Financial/First Call analysts. Revenues for the year rose to $18.0 billion from $16.7 billion in 2000. Same-facility revenues increased 10.2 percent for the year, while same-facility admissions were up 2.7 percent. During 2001, the company paid $95 million in criminal fines and $498 civil penalties as part of a December 2000 settlement with the federal government -- the largest governmental fraud settlement in history. The payments were charged during the 2000 fiscal year. The settlement stemmed from Justice Department allegations that the company routinely inflated diagnoses and committed reporting and billing fraud to increase payments from Medicare and other government health care programs. J.P. Morgan analyst Lori Price credits the recent success to HCA's investments aimed at attracting more business. "They are taking market share away from weaker peers who haven't invested in their own facilities," Price said. "They're expanding units that are oriented toward the needs of the local marketplace." Last year, HCA sold 13 hospitals and other assets -- totaling $519 million -- not related to its core business, Bovender said. HCA operates 184 hospitals and 79 emergency surgery centers, compared to 196 hospitals and 78 emergency surgery centers in 2000. In Tuesday afternoon trading on the New York Stock Exchange, shares of HCA rose 24 cents to $41.89.

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