HCIA shows loss of 1a share Results calculated before $37.66 million write-down

October 23, 1997|By M. William Salganik | M. William Salganik,SUN STAFF

HCIA, the Baltimore health data company, reported a 14-cent-a-share loss in the third quarter, before one-time charges, and a $37.66 million write-down related to the poor performance of its Implementation Unit, formed from LBA Health Care Management Inc., which HCIA acquired in August 1996.

"The charges we have recorded reflect our conclusion that the Implementation Unit will not deliver the profits anticipated at the time of the LBA acquisition," George D. Pillari, chairman and chief executive officer, said yesterday.

Revenue for the quarter was $18.8 million, flat compared with the $18.7 million recorded in the third quarter of 1996.

With the write-down, the company's operating loss was $43.5 million, compared with a loss of $39.4 million in the same quarter last year after other one-time charges.

Barry C. Offutt, chief financial officer, said, "We wanted to lower the loss, and that's what happened." HCIA lost 18 cents a share in the second quarter, results which caught analysts by surprise and drove the price of the stock down by about half.

Pillari said other units of the company had performed well during the quarter -- HCIA does not publicly report results by unit -- and that the Implementation Unit had been reorganized and "should be a solid contributor to HCIA's return to profitability."

The Implementation Unit sells information to hospitals and other health care providers, allowing them to compare their performance with national benchmarks.

HCIA stock closed unchanged yesterday at $15 a share. Earnings were announced after the market closed.

Pub Date: 10/23/97

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