Skilled Healthcare Group, Inc. (SKH) Tuesday reported an increase in net profit for the third quarter, reflecting lower interest expenses and slightly higher revenues. Earnings per share beat Street estimates. The company has updated its full year 2009 guidance from its prior view.
For the third quarter, the Foothill Ranch, California-based company's net income was $9.05 million or $0.24 per share compared with $8.57 million or $0.23 per share in the prior year quarter. Income from continuing operations for the period rose to $9.30 million or $0.25 per share from $8.57 million or $0.23 per share last year.
During the three-month period, Skilled Healthcare had a one-time loss from discontinued operations totaling $243 thousand or $0.01 per share a year earlier.
On an average, 15 analysts polled by Thomson Reuters expected the company to earn $0.22 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the period increased 3.2% to $188.37 million from $182.47 million in the third quarter of fiscal 2008. Analysts expected Skilled Healthcare to generate revenues of $192.56 million during the quarter.
On a segmental basis, revenues from long-term care services segment were $166.2 million, up $6.6 million or 4.1% from the previous year. Revenues from third-party rehabilitation therapy services' segment for the quarter were $19.1 million, up 9.8% from the 2008-year period.
Total expenses incurred by the company during the period were $169.32 million, higher than $163.47 million a year ago. Interest expense for the quarter was $8.4 million, down 8.6% from the three month period ended September 30, 2008, reflecting lower weighted-average interest rates.
In the third quarter, Skilled Healthcare recorded an income tax provision of $2.42 million up from $1.91 million in the corresponding period prior year. The company attributed the decrease in income tax provision to expiration of a statute of limitations, compared to the previous year which included a positive impact of $1.4 million due to expiration of a statute of limitations.
Skilled Healthcare's effective tax rate for the quarter was 20.7% versus 18.2% in the year ago quarter.
For the nine-month period, the company's net income rose 13.6% to $28.14 million or $0.76 per share from $24.76 million or $0.67 per share in the 2008-year period. Income from continuing operations was $28.53 million or $0.77 per share versus $24.76 million or $0.67 per share in the prior year. During the period, the company had a one-time loss from discontinued operations amounting to $390 thousand or $0.01 per share.
Year-to-date revenues increased 5% to $570.76 million from $543.55 million in the comparable period prior year.
Looking ahead to fiscal 2009, Skilled Healthcare currently expects earnings to be in the range of $0.98 to $1.01 per share, while its prior view was $0.95 and $1.01 per share, and revenues to be between $763 million and $767 million, down from its previous expectations of $765 million and $775 million. For the full year 2009, analysts currently anticipate the company to earn $0.98 per share on revenues of $771.42 million.
Chairman and Chief Executive Officer Boyd Hendrickson said, "Going forward, we expect to implement additional cost controls as well as cost reductions to further streamline our operations given proposed Medicare rate cuts and possibly flat Medicaid rates, on average, in the 2010 Medicare and Medicaid fiscal year."
"In addition, the Dallas Center of Rehabilitation, our newest skilled nursing facility which opened in April this year, has steadily increased its census and we believe is on track to break-even at the end of this year as expected," Hendrickson added.
In Monday's regular trading session, SKH closed trading at $8.06 per share on the New York Stock Exchange.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.