AMED $10s with earnings reporting:
Nov. 1, 2011, 12:00 p.m. EDT
Amedisys hit by write-down, news execs to leave
Write-down of $574.1 million, dreary outlook, brings 19% stock drop
By Russ Britt, MarketWatch
LOS ANGELES (MarketWatch) — An extensive write-down reported in Amedisys Inc.’s third-quarter earnings, and an announcement that two key executives are leaving, sent the company’s shares plunging by more than 19% at one point Tuesday.
The home health care company said it would take a non-cash goodwill charge of $574.1 million due to a decline in market capitalization, earnings results and recent forecasts, and added it won’t be able to fully measure the fair value of the write-down until the fourth quarter.
Amedisys /quotes/zigman/58963/quotes/nls/amed AMED -23.00% lost $423.7 million for the period, or $14.73 a share, and had reported earnings of $21.6 million, or 76 cents a share, for the same period a year ago. Sales were $374.9 million against last year’s $404.7 million.
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Without the charge, the company said it would have reported earnings of $10.6 million, or 36 cents a share. But that still would represents a more than 50% drop from last year’s comparable figures of $25.5 million, or 89 cents a share.
Analysts polled by FactSet Research had expected the company to earn an adjusted 50 cents a share for the quarter.
Amedisys also said Chief Operating Officer Mike Snow would be leaving, and Chief Financial Officer Dale Redman will move to the role of executive vice president and treasurer until he retires in 2012.
Shares were down 17% to $10.89.
Anticipating a similar move from Almost Family Inc. /quotes/zigman/81699/quotes/nls/afam AFAM -11.43% when it reports earnings Wednesday, investors discounted that company’s shares by more than 8% to $17.07.
An expectation that Medicare reimbursements will be cut have hit the home health-care sector hard this year. Almost Family shares are worth less than half their 52-week high and Amedisys shares are down by more than two-thirds from their high, reached in February.
Others taking it on the chin this year include LHC Group Inc. /quotes/zigman/95208/quotes/nls/lhcg LHCG -2.55% , down roughly 50% from its high for the year, and Gentiva Health Services Inc. /quotes/zigman/81852/quotes/nls/gtiv GTIV -7.97% , worth less than a fifth of an intraday high reached in April.
LHC was off 1.7%, while Gentiva fell another 4% in Tuesday’s action.
Earnings from two hospital companies offered more encouraging results. Tenet Healthcare Corp. /quotes/zigman/150561/quotes/nls/thc THC +1.16% climbed 4.4% to $4.94 after it reported a growth in volume for the third quarter, as well as an uptick in admissions and surgeries.
Tenet said net income was $6 million, or 2 cents a share, compared with $932 million, or $1.68 a share for the same period a year ago. Sales were $2.34 billion,compared with $2.26 billion a year ago.
Adjusted earnings were 4 cents a share, compared with the 5 cents a share anticipated by the FactSet analyst poll.
Meanwhile, HCA Holdings Inc. said its third-quarter results were down from last year, but were ahead of the FactSet poll forecast.
HCA said net income was $61 million, or 11 cents a share, compared with $243 million, or 55 cents a share, for the same period a year ago. Sales were $8.05 billion against last year’s $7.65 billion.
Adjusted earnings were 60 cents a share, compared with the FactSet estimate of 43 cents a share.
Amedisys Inc.
$ 10.11
-3.02 -23.00%
Volume: 2.48m
Nov. 1, 2011 3:05p
Almost Family Inc.
$ 16.51
-2.13 -11.43%
Volume: 144,299
Nov. 1, 2011 3:04p
LHC Group
$ 15.29
-0.40 -2.55%
Volume: 123,150
Gentiva Health Services Inc.
$ 3.81
-0.33 -7.97%
Volume: 389,860
Tenet Healthcare Corp.
$ 4.79
+0.06 +1.16%
Volume: 11.67m
Nov. 1, 2011 3:05p
C
Russ Britt is the Los Angeles bureau chief for MarketWatch.
