Tuesday, Odyssey Healthcare Inc. (ODSY), a provider of hospice care service, reported a rise in third-quarter profit as revenues increased 65% from last year.
Third quarter net income from continuing operations was $6.32 million or $0.19 per share, compared to $3.90 million or $0.12 per share last year. Net income for the quarter was $5.89 million or $0.18 per share, compared to $3.06 million or $0.09 per share a year ago.
On average, eight analysts polled by First Call/Thomson Financial expected the company to report earnings of $0.14 per share for the quarter.
During the third quarter, the company incurred expenses of about $2.0 million, pre-tax, related to the ramp down of recently acquired VistaCare's corporate office and the integration of its operations. This has reduced income from continuing operations for the quarter by about $0.04 per share. In addition, the company incurred about $1.8 million, pre-tax, of ramp up expenses to handle the incremental work related to the transfer of the VistaCare corporate functions to its own Support Center.
Income from continuing operations during the quarter was positively impacted by about $0.4 million, pre-tax, due to a reduction in the prior-year Medicare cap contractual based on actual cap assessments received from its Medicare fiscal intermediaries for the 2006 Medicare cap year.
Net patient service revenue increased 65.5% to $165.24 million from $99.84 million in the prior year, exceeding analysts' estimate of $163.15 million.
For the nine-month period, income from continuing operations was $13.93 million or $0.42 per share, compared to $13.70 million or $0.41 per share in the same period last year. Net income for the nine months was $9.07 million or $0.27 per share, compared to $10.89 million or $0.33 per share in the previous year.
Net patient service revenue for the nine-month period increased 51.6% to $448.77 million from $296.07 million last year.
Odyssey also announced that on October 1, 2008, it signed a joint venture with Valley Baptist Medical Center to operate a hospice program in the Brownsville-McAllen, Texas area.
ODSY closed at $7.57, down $0.56 or 7.99% on Nasdaq Tuesday.
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