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Columbia/HCA 4Q weak
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February 23, 1999: 9:40 a.m. ET
Health-care firm out of the red, but misses expectations by a wide margin
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NEW YORK (CNNfn) - Columbia/HCA Healthcare Corp. Tuesday reported fourth- quarter results that fell far short of Wall Street estimates and also unveiled a $1 billion stock buyback plan.
For the quarter, the company's earnings from continuing operations, excluding gains and one-time costs, totaled $27 million, or 4 cents per diluted share, compared with last year's loss of $404 million, or 63 cents per diluted share.
Analysts polled by tracking firm First Call had forecast a profit of 23 cents per share.
Revenue from continuing operations climbed to $4.42 billion from $4.37 billion.
In the fourth quarter, Columbia sold 14 hospitals and certain other non-core assets for about $615 million, which resulted in a pre-tax gain of $207 million, or 19 cents per share. In addition, the company recorded asset impairment charges on several facilities totaling $208 million, or 23 cents per diluted share.
Nashville, Tenn.-based Columbia blamed weaker-than-expected results on higher costs of new technology and pharmaceuticals, a rise in bad debt expense and declining patient volume in the fourth quarter.
Reduced Medicare payments, mandated by the Balanced Budget Act of 1997, also had an adverse impact on the company's bottom line. These payments dropped $55 million in the fourth quarter and about $215 million for the year.
For the year, the company's profit from continuing operations totaled $590 million, or 91 cents per diluted share, on revenue of $18.68 billion. The previous year, the company earned $565 million, or 85 cents per diluted share, on revenue of $18.82 billion.
Columbia also disclosed a $1 billion share buyback program Tuesday. The company plans to repurchase its shares on the open market, through privately-negotiated transactions and through a series of forward purchase contracts.
Shares of Columbia/HCA climbed 3/16 to 18-3/8 Monday. 
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