Companies in the News
Companies in the News
Allied revenues decline in 3Q99
Allied Healthcare Products (St. Louis) reported revenues for 3Q99 ended March 31 of $19.2 million, compared to $22.8 million in 3Q98. The revenue decrease was due to the relocation of the company’s B&F Medical operations from Toledo, OH, to St. Louis, as well as the sale of the Bear Medical unit. Allied reported a net loss of $200,000, 2 cents per share, compared to a net income of $200,000, 3 cents per share, in 3Q98. The company recorded bookings of $18.5 million during 3Q99, compared to bookings of $22.5 million during 3Q98. In 3Q99, bookings declined in the company’s home care division, emergency product group, and architectural products, the company said. Orders for home care products were likely affected by the B&F relocation.
Apria reports a profit for 1Q99
Apria Healthcare Group (Costa Mesa, CA) reported a profit for 1Q99, which ended March 31, of $15.6 million, 30 cents per share, compared to a net loss in 1Q98 of $6.6 million, 13 cents per share. Net revenues were $228.3 million in 1Q99, compared to $250.5 million in 1Q98. "The increase in revenues and gross margin percent demonstrated real topline growth over the previous quarter," said CEO Philip Carter. "The increase in net revenues is in spite of continuing to exit unprofitable infusion business in 4Q98 and absorbing an additional 5% cut in reimbursement from Medicare."
Bergen to supply products to VNS
Bergen Brunswig Corp. (Orange, CA) will be the exclusive supplier of prescriptions, medicine, equipment, and other home health goods to Visiting Nurse Service Inc., a home health agency. Services, the company officials said, will be routed through Sims Communications’ One Medical Service network. Terms of the deal were not disclosed, reported Dow Jones Business News.
Beverly sells to HomeCare Solutions
Beverly Home Care, a subsidiary of Beverly Enterprises (Fort Smith, AR), has sold its middle Tennessee operations to HomeCare Solutions (Chattanooga, TN). The deal was made final March 31, reported the Nashville Business Journal, and the five locations will merge with HomeCare’s Madison, TN, office, which operates under the name Southern Home Health and Hospice. The merger will eliminate some jobs belonging to 150 employees. Beverly plans to divest itself of home health care services, but will maintain a presence in hospice, infusion, and home medical equipment services, Beverly Home Care President Glen Cavallo told the Journal.
Coram CEO resigns position
Donald Amaral has resigned his position as CEO of Coram Healthcare Corp. (Denver), but will remain chairman of the company’s board. Richard Smith, currently the company’s president, has taken his place and will also be a member of the company’s board. Amaral joined Coram in 1995 when the company was in serious financial condition. He is credited with turning things around, settling shareholder class action suits, resolving the dispute with Caremark International and Caremark Inc. for $165 million, and selling the lithotripsy division for about $126.6 million. He also reduced debt by half, the company said. Smith told the Denver Post that nothing will change "about the strategic direction of the company," and that Amaral wants to concentrate on strategic issues.
HealthCor’s revenues drop in 4Q98
HealthCor Holdings (Dallas) saw net revenues decrease in 4Q98 to $24.9 million, compared to $34.6 million in 4Q97. The company reported a net loss for the quarter of $64.2 million, $6.36 per share, compared to a net loss in 4Q97 of $15.4 million, $1.53 per share. For the year, net revenue decreased to $115.7 million, compared to $143.2 million in FY97. HealthCor attributes the decrease to a reduction in Medicare nursing revenues because of the changes to reimbursement. The decrease is partially offset by a growth in revenues in the respiratory therapy/medical equipment business. The company posted a net loss of $98.3 million, $9.74 per share, compared to a net loss of $15.6 million, $1.56 per share, in FY97. The net loss includes pre-tax charges during FY98, including good will write-offs of $31.8 million, additional provisions for doubtful accounts of $31.6 million, and a loss on disposition of assets of $1.5 million.
Interim faces suit over dropped services
Three Tennessee women filed a suit in U.S. District Court against Interim HealthCare alleging the company’s Tennessee offices dropped their services because of Medicare cuts. The women claim that Interim had a process of identifying and dropping patients who were high-cost users of home healthcare, reported The Tennessean. David Butler, attorney for Interim, said the company did nothing wrong. But plaintiff attorneys say the company circulated a document telling employees to determine the costly users of home healthcare and transfer them out of the company’s coverage.
Interwest announces record earnings
Interwest Home Medical (Salt Lake City) has announced record earnings for 2Q99, which ended March 31. Total revenues were $7.8 million, an increase of 12% over the $7 million in revenues recorded in 2Q98. Net income was $412,000, 10 cents per share, compared to 2Q98 net income of $343,000, 8 cents per share.
Mallinckrodt reports increased earnings
Mallinckrodt (St. Louis) reported earnings of $31.9 million in 3Q99 ended March 31, compared to earnings of $27.9 million in 3Q98. The company’s net sales were $675 million 4% more than 3Q98 sales of $649.8 million.
Matria notices increased revenues in 1Q99
Matria Healthcare (Marietta, GA) saw revenues increase by 81% in 1Q99, up to $59.4 million, compared to $32.8 million in 1Q98. Net income was $935,000, 3 cents per share, compared to a 1Q98 net loss of $5.6 million, 15 cents per share. Results from 1Q99 include the acquisitions of Gainor Medical Management and Diabetes Management Services.
McKesson HBOC to restate 4Q98 results
McKesson HBOC (San Francisco) said that improper accounting at its HBO & Co. healthcare information management business is causing it to restate results for 4Q98. The announcement caused McKesson’s shares to nosedive 48%, reported The Wall Street Journal. Earnings for 4Q98 will be reduced by about $17 million, 6 cents per share, to $160 million, 56 cents per share. It was previously announced that earnings were $177.2 million, 62 cents per share. The company now projects a lower profit outlook for FY99 of $2.50 a share, instead of $3 a share. The accounting problems were due to improperly recognized revenue of software sold by the company to hospitals and doctors. Various contingencies in the sales had not been met, but the company expects the sales will eventually be recorded.
Olsten closes Rhode Island office
Olsten Corp. (Melville, NY) plans to close its Providence, RI, health services office, laying off six full-time employees, reported the Providence Journal-Bulletin. An additional 25 part-time home health workers will be affected. Olsten serves about 125 patients in Providence, and the company will make arrangements to transfer these patients to other home health agencies, as is required by federal Medicare rules. Olsten said last month it would close or consolidate 15 nursing offices nationwide to save money and that it would take a special charge of about $70 million to settle federal investigations and to restructure the company. The company has also said that it is providing primary distribution and support services for the Avocet PT-Pro, a hand-held diagnostic device manufactured by Avocet Medical. The device measures blood clotting time in patients receiving anticoagulant therapy.
Rehabilicare says revenues grew in 3Q99
Rehabilicare (New Brighton, MN) reported higher revenue and net income for 3Q99. The company saw revenues go up to $10.9 million, compared to $8.4 million in 3Q98. Net income was $681,000, 7 cents per share, compared to a net loss in 3Q98 of $1.8 million, 17 cents per share. Results for 3Q99 reflect the merger of Staodyn and Rehabilicare approved by shareholders on March 17. The merger was recorded as a pooling of interests.
Respironics reports results for 3Q99
Respironics (Pittsburgh) reported $90.9 million in net sales for 3Q99 ended March 31. Net sales in 3Q98 were $80.1 million. Net income was $8.3 million, 26 cents per share, for 3Q99, compared to a net loss of $22.3 million, 69 cents per share, for 3Q98. The 3Q98 figures include charges of $37.5 million, 82 cents per share, related to the company’s merger with Healthdyne Technologies. Also, Respironics has entered into a long-term distribution arrangement with Heinen+Lowenstein GmbH (Bad Ems, Germany), a home care distribution company. Heinen+Lowenstein will distribute all Respironics and Healthdyne products in Germany
Shands employees offered jobs with Flagship
Most of Shands HealthCare’s (Gainesville, FL) home care workers will be given the option to accept positions with Flagship Healthcare (Miami Lakes, FL), the company that acquired Shands recently for an undisclosed amount. Severance packages will be given to any of the 845 employees affected who do not want the job with Flagship. Shands plans to close some of its sites across Florida, but will continue operating out of Gainesville.
Star completes private placement
Star Multi Care Services (Huntington Station, NY) has completed a private placement by the sale of $575,000 Series A 8% convertible preferred stock valued at $1 per share. The Shaar Fund has purchased the stock providing Star nets proceeds of $500,000. After 60 days, the stock may be converted to common stock. The stock pays an 8% annual dividend payable quarterly that may be converted into common stock if the company chooses. Shaar has also received the right to purchase 50,000 common stock shares of the company at 115% of the closing bid price on the trading day preceding the closing date of the sale. Star plans to use proceeds from the sale to satisfy working capital needs and reduce its outstanding balance on its revolving loan. "This represents a strategic investment by the Shaar Fund to capitalize on the remarkable turnaround of our home healthcare company, said Star president/CEO Stephen Sternbach. "This financial contribution will provide operating capital as we expand our market in the highly fragmented home healthcare industry."
Sunrise announces results for 3Q99
Sunrise Medical (Carlsbad, CA) announced its financial results for 3Q99 ended April 2. Net income was $1.8 million, 8 cents per share, compared to a net loss in 3Q98 of $98,000, 0 cents per share. Income had been reduced in 3Q98 due to $5.3 million in reengineering expenses. Net sales were $170 million 3% higher than 3Q98 sales of $164 million. Also in 3Q99, Home Healthcare Group sales rose 2% and European Homecare sales rose 8%. Both are subsidiaries of Sunrise.
Transworld stock to trade on American
Transworld Healthcare (New York) has announced that its common stock will begin trading on the American Stock Exchange, effective April 30, instead of Nasdaq. The stock symbol will be TWH. The change occurred because the company’s shares were not quoted at a price of $5 or more, putting it out of compliance with Nasdaq’s rule.
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