Youth Services posts drop of 23% in first-quarter profit

November 08, 1996|By Ted Shelsby | Ted Shelsby,SUN STAFF

Youth Services International Inc., an Owings Mills-based operator of educational and correctional programs for troubled youths, reported yesterday that its first-quarter earnings were down 23 percent despite a 21.7 percent increase in revenues.

For the three months ended Sept. 30, the company earned $570,000, or 6 cents a share. That compared with a profit of $742,000, or 8 cents a share, in the same period a year ago.

Revenues totaled $27.7 million, up 21.7 percent from $22.75 in the corresponding period of 1995.

Joan S. Stephens, a vice president for Youth Services, said the decline in earnings was the result of a occupancy problem at the company's Woodward Academy in Iowa and expenses related to delays in the consolidation of other facilities it acquired.

She said licensing of the Woodward Academy was delayed until the company could train personnel needed to operate its four youth correctional programs. It could not take students until the license was obtained.

"The problems at Woodward have been fixed," said Timothy P. Cole, Youth Service's chief executive officer. Stephen said that two acquisitions were not consolidated into the company's overall operations as rapidly as anticipated.

Cole said, however, that the company's restructuring program is on schedule and "we see substantial improvements in earnings for the second quarter. The third and fourth quarters should be robust as well," he added.

Youth Services operates 18 residential and community-based facilities for about 4,000 troubled youths in 11 states.

The company's stock closed yesterday at $15.875 a share, up 50 cents.

Pub Date: 11/08/96

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