Several of L.A.'s largest health care companies defying recession.

Some of the largest Los Angeles-based, publicly held health care companies defied the recession during the third quarter by posting increases in both sales and earnings. Better still, they are projecting even greater increases in the fourth quarter. Meanwhile, at other large health care companies in L.A. County, earnings continue to drop.

Some of the companies enjoying good times attributed their third-quarter success to inventory-related issues. Restocking inventory tends to drive up sales and profits at medical-supplies vendors. But at the same time, it drives up expenses and holds down profits for hospitals and other health care providers that purchase medical supplies.

Many health care providers started just-in-time inventory controls two years ago to cut down on inventory and operating expenses. The "JIT" system is an arrangement between vendors and providers whereby vendors restock supplies for health care providers based on each provider's past use. Vendors hold those supplies until the health care providers absolutely need them, thus reducing the provider's need to tie up capital in inventory.

Vendors reported that some providers are now moving away from the two-year-old JIT system, and are once again keeping more supplies in stock. That trend is boosting profits for vendors.

On a related front, some local companies that manage health maintenance organizations or outpatient surgery centers reported higher third-quarter sales and profit because more people are signing up for HMOs to escape skyrocketing health care costs. Employers and workers can reduce their health care expenses by up to 70 percent by joining an HMO as opposed to buying their insurance outside of a group, health care consultants said.

Some innovative Los Angeles County health care companies are enjoying success by designing new products they are selling throughout the world. Some such companies experienced double-digit growth in sales and net income in the third quarter, compared with the previous quarter.

The following mini-profiles outline what is happening with some of the biggest Los Angeles County-based publicly held health care companies:

* Santa Monica-based National Medical Enterprises Inc., the largest (in sales volume) Los Angeles County-based health care company, reported third-quarter sales of $941.4 million, down from $984.5 million for the like period in 1991. Net income dipped from $71.6 million in third quarter 1991 to $50.6 million in the like period this year.

National Medical Enterprises owns and manages acute-care hospitals, psychiatric hospitals and physical-rehabilitation hospitals. Its most recent quarterly earnings report attributed the company's third-quarter decline to a 47-percent drop in net income at its psychiatric hospitals division, from $294.8 million in third quarter 1991 to $155.6 million in third quarter 1992.

* Culver City-based GranCare operates 68 long-term health care facilities in California, Wisconsin, Colorado, Arizona, Illinois and South Dakota. Its third-quarter 1992 earnings were $2.9 million, or 30 cents per share, on revenues of $75.4 million. That's up from net earnings of $900,000, or 18 cents per share, on $38.4 million in revenues for year-ago quarter.

"The recent addition of seven facilities from The Samaritan Foundation, as well as annual increases in reimbursement rates favorably impacted our quarterly results," said Gene E. Burleson, president and chief executive officer of GranCare. "We anticipate the additions of the ConvaCare pharmacy operations, Oakview Health Care Complex and the pending acquisition of 17 Michigan facilities."

* Burbank-based Summit Health Ltd. reported net income of $1.4 million, 4 cents per share, on sales of $112.1 million. That's a decline in net income from $1.9 million, 6 cents per share, on sales of $102.3 million for the same period in 1991.

Dean Staley, Summit's chief financial officer, predicted a better fourth quarter. He said the third-quarter drop in net income was due to writing off costs of a bond issue.

That decline in net income came despite increased sales due to clients paying their deductibles for the year and getting elective surgery performed before the end of the year, Staley said.

In the coming year, Summit will look at buying more long-term and ambulatory care facilities, he added.

"We think that's the direction health care is moving in to control costs for the patients and the insurers," he concluded.

* Torrance-based Sunrise Medical -- a company that makes and sells medical products used in prevention, recovery and rehabilitation -- reported a jump in net income from $2.4 million on sales of $52.83 million in third quarter 1991, to a net income of $4 million on sales of $71.4 million in the same period in 1992.

"We design and market our own medical products in North America and Europe," said Ted Tarbet, a Sunrise vice president and chief financial officer. "We are selling 2,000 to 3,000 wheelchairs a week, priced from $1,800 to $3,000 each."

Sunrise also is expanding its division that makes machines to sterilize surgical instruments.

* Torrance-based MDT Corp. develops, makes and sells systems that sterilize surgical instruments and supplies.

It reported a dip in third-quarter net income, compared with both the prior quarter and the year-ago quarter, as customers put off new purchases due to skepticism about the economy, said Tom Hein, MDT's vice president of finance.

Specifically, MDT posted third-quarter net income of $298,000 on sales of $32.6 million. That compares with second-quarter net income of $439,000 on sales of $31.6 million, and year-ago third-quarter net income of $370,000 on sales of $30.6 million.

Despite the poor third-quarter showing, Hein asserted better times lie ahead.

"The market for our sterilizing and instrumentation equipment is picking up," insisted Tom Hein, MDT's vice president of finance. "We also are getting more orders for our equipment that sterilizes the workplace for pharmacists."

* Optical Radiation Corp. of Azusa designs and makes ophthalmic products and optical systems for medical, industrial and scientific users. Sales for the most-recent quarter available (ended July 31) stood at $40.7 million, a slight increase from $40 million in sales for the like quarter of 1991.

Net income dipped sharply to $39,000, down from $3.6 million for the like year-ago period. Optical Radiation attributed the earnings decline to a downsizing of some of its operation and a $1.5 million payment to settle a lawsuit. Company officials did not return calls to explain the nature of the suit.

* Chatsworth-based Syncor International Corp. makes and sells radio pharmaceutical products for diagnostic tests. It also has a nationwide network of 96 pharmacy service centers in 36 states. That network delivers 16,000 prescriptions daily to 6,000 hospitals, clinics and other users.

For the quarter ended Aug. 31, Syncor reported a dramatic increase in net income, posting $2.2 million (21 cents per share) on sales of $59.6 million. For the like period in 1991, Syncor had net income of $1.6 million (15 cents per share) on sales of $47.3 million.

Syncor International President and Chief Executive Gene McGrevin said his company will keep expanding its national pharmacy network through start-ups and acquisitions. He added that Syncor will consider purchasing additional health care businesses in the year ahead.

For the 1992 fiscal year ended May 30, Syncor reported $210.2 million in revenues, up 34 percent from the previous year. Net income was $6.9 million, up 44 percent from the previous fiscal year. Earnings per share for fiscal 1992 were 63 cents per share, up 37 percent from the previous year.