IHS posts $61.9 million loss after fourth-quarter charges Health care

March 05, 1998|By M. William Salganik | M. William Salganik,SUN STAFF

Integrated Health Services Inc. yesterday reported improved operating margins for the last quarter of 1997, but posted a loss after one-time charges stemming from two acquisitions.

After the charges of $87.9 million, IHS, the Owings Mills operator of facilities and services for post-hospital care, posted a $61.9 million loss, or $1.59 a share. Before the charges, IHS had a profit of $27.9 million for the quarter, or 64 cents a share. For the last quarter of 1996, IHS earned $14.4 million, or 53 cents a share.

Revenue for the quarter ended Dec. 31 was $602.2 million, up 35 percent from $445.7 million in the corresponding quarter last year.

Robert M. Wasserman, vice president for research at Southeast Research Partners in Boca Raton, Fla., said the earnings were a few cents a share more than he had expected. He said the market would not be troubled by the one-time charges, "more an accounting treatment than anything else," which are related to selling off units of companies IHS had acquired.

During the quarter, Integrated closed on its purchase of RoTech Medical Corp. of Orlando, Fla., a supplier of home respiratory services and durable medical equipment for about $900 million in stock and assumed debt; and units of Horizon/CMS Healthcare from Healthsouth Corp. for $1.15 billion in cash and $100 million in assumed debt.

The two acquisitions, the largest in the company's history, continued its rapid growth. Revenue for the year was just short of $2 billion, up 39 percent from 1.4 billion in 1996, although RoTech and Horizon deals were not completed until the last quarter.

IHS reported a net loss for the year of $33.5 million, compared with a profit of $46.3 million in 1996.

IHS stock closed at $34.6875 a share, up 68.75 cents a share.

Pub Date: 3/05/98

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