HealthSouth ex­pects ro­bust re­sults

Modern Healthcare - - REGIONAL NEWS - —Beth Kutscher

HealthSouth Corp., a pub­licly traded op­er­a­tor of in­pa­tient re­ha­bil­i­ta­tion hos­pi­tals, raised its fi­nan­cial pro­jec­tions for 2014 af­ter an­nounc­ing strong re­sults in the first half of the year.

The Birm­ing­ham, Ala.-based chain re­ported a 45.3% drop in net in­come in the sec­ond quar­ter com­pared with the same pe­riod in 2013. How­ever, last year’s re­sults in­cluded a one-time fed­eral in­come tax ben­e­fit stem­ming from a set­tle­ment with the In­ter­nal Rev­enue Ser­vice. Ex­clud­ing the set­tle­ment, HealthSouth’s op­er­at­ing per­for­mance im­proved year over year as rev­enue grew faster than ex­penses.

HealthSouth also booked a $27.2 mil­lion in­come gain when it ac­quired an ad­di­tional 30% stake in Fair­lawn Re­ha­bil­i­ta­tion Hos­pi­tal from its joint ven­ture part­ner, UMass Memo­rial Health Care. The deal, which in­creased HealthSouth’s own­er­ship stake in the Worces­ter, Mass.based fa­cil­ity to 80%, closed in June.

Same-hos­pi­tal dis­charges in the sec­ond quar­ter in­creased 1.4% year over year. How­ever, new hos­pi­tals in HealthSouth’s port­fo­lio, in­clud­ing Fair­lawn, helped boost to­tal dis­charges 3%. Rev­enue per dis­charge in­creased 4.9%.

In to­tal, HealthSouth re­ported $97.9 mil­lion of net in­come on $595.1 mil­lion of net rev­enue in the sec­ond quar­ter of 2014 com­pared with $179 mil­lion in in­come on $557.5 mil­lion in rev­enue in the prior-year pe­riod.

HealthSouth also said it is now ex­pect­ing $570 mil­lion to $580 mil­lion in full-year earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­za­tion, in­stead of its pre­vi­ous fore­cast of $555 mil­lion to $565

mil­lion.

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