(Reuters) - Hospital operator Tenet Healthcare Corp (THC.N) reported higher-than-expected quarterly earnings on Tuesday as it treated more patients, and its shares rose 6 percent.
The third-largest U.S. hospital chain said the number of patients treated in specialties including trauma, neurosurgery, oncology and vascular surgery was especially strong.
“Our fundamental business trends in terms of volume growth, pricing and cost controls remained strong,” Chief Executive Trevor Fetter said on a conference call with analysts. He said patient volume growth compared favorably with that of competing hospitals.
Second-quarter income from continuing operations rose to $42 million, or 10 cents per share, from $40 million, or 8 cents per share, a year earlier.
Net operating revenue climbed 6.2 percent to $2.23 billion.
Analysts on average had expected a profit of 4 cents per share on revenue of $2.27 billion, according to Thomson Reuters I/B/E/S.
Including charges for the expected sale of Creighton University Medical Center, Dallas-based Tenet posted a net loss of $6 million, or 1 cent a share, compared with year-earlier net income of $55 million, or 11 cents a share.
Adjusted earnings before interest, taxes, depreciation and amortization rose 4.7 percent to $288 million.
Tenet said adjusted admissions, which include both in-patient and out-patient, rose 1.5 percent. Total admissions, which reflect only patients admitted for overnight stays, slipped 0.4 percent. Hospitals generally are treating more people on an out-patient basis as patients look to avoid costly hospital stays in a weak economy.
Surgeries increased by 4.9 percent in the quarter, while emergency department visits increased 5 percent, Tenet said.
Tenet’s bad debt expense increased to $190 million from $168 million. Hospitals are grappling with rising bad debts as they treat more patients who lack health insurance.
Tenet stood by its forecast for full-year adjusted EBITDA of $1.25 billion to $1.375 billion.
Tenet shares rose 28 cents, or 6 percent, to $4.94 in morning trading on the New York Stock Exchange.
Reporting by Susan Kelly in Chicago and Adithya Venkatesan in Bangalore; Editing by Maju Samuel, Lisa Von Ahn and John Wallace