Printer Friendly

NOVACARE REPORTS PRELIMINARY THIRD QUARTER RESULTS

 KING OF PRUSSIA, Pa., April 13 /PRNewswire/ -- NovaCare, Inc. (NYSE: NOV) today announced that due primarily to non-recurring charges, financial results for the third quarter ended March 31, 1993 will be below analysts' expectations.
 "NovaCare has had 19 consecutive quarters of record performance and we are confident that we will be back on track for the fourth quarter of 1993," said John H. Foster, chairman and chief executive officer. "Our financial results stem in large part from extraordinary one-time events. We continue to believe that the rehabilitation industry -- and especially NovaCare -- is well positioned to benefit under any health care reform package. The evolving health care system presents many opportunities for companies that provide quality patient care in a cost- effective manner."
 NovaCare anticipates that third quarter results will include a pretax charge of approximately $5.7 million or $.07 per share on a fully diluted basis for restructuring the company's orthotics and prosthetics ( O&P) business, which NovaCare acquired last year, and for restructuring other aspects of the company's business. In addition, third quarter operating results will be below analysts' expectations by approximately $.04 per share measured on a fully diluted basis. Prior to this announcement, analysts' estimates for the third quarter were $.25 to $.27 per share on a fully diluted basis. The company expects to announce third quarter results during the fourth week in April.
 "The restructuring charge reflects the need to consolidate several poorly-located O&P patient care and fabrication centers, close selected community integrated programs, adopt the NovaCare brand name across all company services and consolidate corporate headquarters in King of Prussia," said Mr. Foster. "By undertaking the restructure plan, we improve our ability to realize the enormous potential in NovaCare's integrated continuum of rehabilitation services."
 Third quarter operating results reflect the impact of severe winter storms on the company's O&P and contract services businesses. Rain storms in the south and southeast and snow across the northern part of the country restricted travel by both patients and therapists. One NovaCare branch in Vermont was open only nine days in February.
 Further, the implementation of improved operating systems and controls over the past six months has disrupted marketing and sales efforts within the O&P group's clinical organization. Third quarter operating earnings will also reflect an $800,000 provision for anticipated losses in a single short-term investment.
 "We have identified the cultural and operating issues within the O&P organization and systems," said Jeffrey S. Levitt, president and general manager of the Orthotics and Prosthetics Group. "We expect that over time, with appropriate management training and continued systems enhancements, we will produce the same positive results that NovaCare generated with its successful turnaround of the contract services business in the late 1980s."
 "We remain confident of the fundamentals of the O&P industry," added Mr. Levitt. "In fact, we will soon resume the acquisition of O&P practices in selected markets."
 In the third quarter of fiscal 1992, NovaCare reported net income of $10.7 million or $.21 per share measured on a primary common share basis. Net income for the quarter ended Dec. 31, 1992 was $12.7 million or $.25 per primary share.
 NovaCare, Inc. is the largest provider of rehabilitation therapy services on a contract basis to health care institutions and is the nation's leading provider of orthotic and prosthetic patient care services. In addition, the company operates seven rehabilitation hospitals and seven community integrated programs. The company treats more than 15,000 patients per day.
 -0- 4/13/93
 /CONTACT: Ms. Susan J. Campbell, director of investor relations of NovaCare, Inc., 215-650-0841, or Dr. Anthony J. Russo of Noonan/Russo Communications, Inc., 212-979-9180/
 (NOV)


CO: NovaCare, Inc. ST: Pennsylvania IN: MTC SU: ERP

TM-KW -- NY080 -- 5416 04/13/93 17:15 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Apr 13, 1993
Words:631
Previous Article:FMC WINS HOWITZER CONTRACT FROM U.S. ARMY
Next Article:FIRST COMMONWEALTH REPORTS STRONG FIRST QUARTER
Topics:


Related Articles
NOVACARE ANNOUNCES RECORD ANNUAL EARNINGS UP 83 PERCENT
NOVACARE REPORTS RECORD FIRST QUARTER PERFORMANCE
NOVACARE REPORTS RECORD SECOND QUARTER PERFORMANCE
NOVACARE ANNOUNCES THIRD QUARTER RESULTS
NOVACARE ANNOUNCES RECORD ANNUAL EARNINGS UP 25 PERCENT
NOVACARE REPORTS 45% INCREASE IN THIRD QUARTER INCOME FROM RECURRING OPERATIONS
NOVACARE ANNOUNCES FIRST QUARTER RESULTS
NOVACARE ANTICIPATES WEAK SECOND QUARTER RESULTS
NOVACARE ANNOUNCES $.15 PER SHARE FROM RECURRING OPERATIONS AND CUSTOMER AGREEMENT
NOVACARE ANNOUNCES $.12 PER SHARE FOR FIRST QUARTER

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters