Shares of Health Management Associates, Inc. (HMA) plunged more than eight percent in extended trade on Thursday after the health-care services provider reported a profit for the first quarter that missed analysts' expectations. Profit declined on the continuing drop in patient admissions. Adjusted revenues grew and topped Street estimates.
"Our first quarter results did not meet our expectations and reflect a difficult operating environment. I believe, however, that we have taken the necessary steps to adjust our cost structure going forward to achieve our previously updated 2013 annual guidance," President and CEO Gary Newsome said in a statement.
The Naples, Florida-based hospitals operator reported net income from continuing operations of $23.10 million or $0.09 per share for the fourth quarter, down from $39.09 million or $0.15 per share in the prior-year quarter.
Excluding items, adjusted earnings per share from continuing operations was $0.13, compared to last year's $0.24. On average, 17 analysts polled by Thomson Reuters expected earnings of $0.15 per share for the quarter. Analysts' estimates typically exclude special items.
Net revenues edged down to $1.48 billion from $1.49 billion in the previous year. Provision for doubtful accounts increased to $240.9 million from $201.3 million a year ago.
Excluding provision for doubtful accounts, adjusted net revenues for the quarter increased to $1.72 billion from $1.69 billion in the same quarter last year, and topped seventeen Wall Street analysts' consensus estimate of $1.66 billion.
Same hospital net revenue increased 1.0 percent to $1.47 billion. Same hospital net revenue per adjusted admission rose 5.0 percent, while same hospital surgeries declined 5.6 percent. Same hospital emergency room visits grew 1.0 percent. Occupancy declined 260 basis points to 47.1 percent from last year.
Same hospital admissions decreased 8.8 percent, and adjusted hospital admissions declined 5.8 percent, due to the continuing effects of declines in uninsured admissions and increases in observation stays.
Looking ahead to fiscal 2013, Health Management had in mid-April said it expects adjusted earnings from continuing operations in a range of $0.86 to $0.95 per share, on projected adjusted revenues between $6.80 billion and$7.0 billion. Street is currently looking for full-year 2013 earnings of $0.87 per share on revenues of $6.72 billion.
"As we transition into this new era of health care reform, we intend to continue our patient-centered approach to health care delivery while increasing efficiency and ultimately quality as we enable America's best local health care," Newsome added.
HMA closed Thursday's regular trading session at $11.23, up $0.29 or 2.65% on a volume of 4.83 million shares. However, the stock plunged $0.93 or 8.28% in after-hours trading.
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