Tenet Expects To Report Loss for First Quarter
Officials for Tenet Healthcare, the nation's second-largest private hospital chain, on Tuesday reported that the company expects to post a loss of $117 million, or 25 cents per share, in the first quarter, compared with a net loss of $20 million, or 4 cents per share, a year earlier, the Los Angeles Times reports. Tenet currently is trying to settle a "bevy of civil and criminal investigations into its business practices and patient care," the Times reports. Tenet officials said that without one-time charges associated with litigation, government probes, discontinued operations and restructuring costs, the company would have posted a first-quarter profit of five cents per share (Girion, Los Angeles Times, 4/28). In January, Tenet announced plans to sell 27 of its 100 hospitals. The company began downsizing last year when it announced plans to sell or divest 14 facilities as part of an ongoing cost-cutting effort (California Healthline, 4/5). For the quarter, revenue from hospitals that Tenet is not selling decreased by 2.9% to $2.67 billion from $2.75 billion a year earlier, Bloomberg/Philadelphia Inquirer reports (Ryerson-Cruz, Bloomberg/Philadelphia Inquirer, 4/28). Tenet officials also said that the company's bad debt expense decreased to 11% of net revenue from 11.9% in the fourth quarter of 2003, the Times reports.
"While our earnings remain below peer performance levels, we are encouraged to see tangible evidence that we are on the right track and our turnaround strategies are focused on the right areas," Tenet CEO Trevor Fetter said (Los Angeles Times, 4/28). Fetter added, "After a very difficult 18-month period following the events of October 2002, our business finally appears to be stabilizing. Although it would be premature to believe we are out of the woods, the first-quarter results are certainly encouraging." Stephen Farber, chief financial officer for Tenet, said that the firm's 2004 full-year earnings would "probably break even," Bloomberg/Inquirer reports. Tenet will release its official first-quarter results May 4 (Bloomberg/Philadelphia Inquirer, 4/28).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.