Health Management Associates Inc. said Monday its profit climbed 18 percent in the first quarter as it expanded its network of hospitals.
The company said its profit grew to $55.5 million, or 22 cents per share, from $46.9 million, or 19 cents per share one year earlier. Revenue grew 13 percent, to $1.43 billion from $1.27 billion.
Analysts expected a profit of 21 cents per share and $1.46 billion in revenue, according to FactSet.
Health Management runs 59 hospitals in non-urban locations. It is forming a partnership with Tri-Lakes Medical Center Inc. in Batesville, Miss., and when that deal is complete, it will have 60 hospitals with room for about 9,000 patients. That's up from 55 hospitals and a capacity of about 8,400 at the end of the first quarter of 2010.
The company said admissions grew 4.2 percent and adjusted admissions rose 8.3 percent. Adjusted admissions includes both inpatient and outpatient visits. Revenue per adjusted admission rose 4.1 percent, and total surgeries increased 6.1 percent. Health Management said revenue from hospitals open at least a year grew 4.8 percent to $1.33 billion and surgeries at those hospitals rose 0.5 percent. However admissions at those hospitals fell 3.9 percent and adjusted admissions decreased 0.3 percent.
Results from hospitals open at least a year are an important reading of the company's business because they leave out results from hospitals opened, acquired, closed or sold in the last year. Health Management Associates said procedures at hospitals open at least a year fell because of a decline in uninsured admissions and weather-related disruptions.
In the most recent quarter Health Management Associates' total occupancy fell to 48.3 percent from 49.1 percent, and the company received 49.7 percent of revenue from outpatients, up from 48.1 percent a year ago. Patient days increased and emergency room visits climbed 14.5 percent.
Health Management reported greater bad debt expenses — or debts the company does not expect to be repaid — along with higher uninsured self-pay patient discounts and greater charity and indigent care write-offs.
The company raised its annual profit forecast, saying it expects earnings of 74 to 78 cents per share, up from its previous estimate of 72 to 76 cents per share. It did not change its revenue guidance of $5.7 billion to $5.9 billion. However the company lowered its expectations for same-hospital admissions. Health Management Associates now says its same-hospital adjusted admissions could grow as much as 1 percent or fall as much as 1 percent. Previously it said those admissions could be unchanged or could grow as much as 2 percent.
Analysts expect the company to report a profit of 75 cents per share and revenue of $5.73 billion on average.
Health Management Associates stock rose 8 cents to $10.39 in the regular session Monday. The shares fell 39, or 3.8 percent, to $10 in aftermarket trading.