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DaVita 1Q profit falls as expenses grow

Mon, 05/02/2011 - 4:45pm
The Associated Press

DaVita Inc., which runs kidney dialysis clinics, said Monday that its profit fell 14 percent in the first quarter as higher expenses offset revenue growth. But results till topped expectations, sending shares up 6 percent in extended trading.

DaVita said it earned $94.5 million, or 96 cents per share, compared with $109.4 million, or $1.04 per share, one year ago. Revenue rose 3 percent to $1.61 billion from $1.56 billion.

Analysts, on average, expected a profit of 95 cents per share and $1.6 billion in revenue, according to FactSet.

DaVita provided about 4.6 million treatments during the quarter. On a per-day basis, treatments rose 7.2 percent from last year. At centers DaVita has owned and operated for at least a year, treatments were up 4 percent.

However, the company said its debt costs grew 31 percent to $58.6 million, and its general and administrative costs and depreciation and amortization expenses also increased. One bright spot was the company's tax rate, which dropped nearly 5 percent.

DaVita acquired and opened 33 locations in the first quarter, sold one, and closed two. The company said it ran or provided administrative services at 1,642 centers serving about 128,000 patients at the end of the quarter.

Shares of DaVita rose $1.08 to close at $89.17, and jumped $5.21 to $94.38 in late trading after the report.

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