Home Therapy Boom Boosts Caremark Profits

Caremark Inc., formerly Home Health Care of America, said its had record third-quarter revenues and earnings. Net income for the quarter ended March 31 rose 83% to $2 million, from the $1.1 million reported in the third quarter of 1984.

The Newport Beach health-care services company said Tuesday that strong growth in its home therapy business contributed to the increase in profits. Caremark specializes in providing home health-care services to seriously or chronically ill patients.

Quarterly revenues rose 45% to $19 million from $13 million in the year-ago period.

For the nine months, net income was $5.2 million, compared to $133,000 in the first nine months of fiscal 1984. The 1984 figure, however, reflected a write-down of $4 million for uncollected revenues. In the 1985 third quarter, revenues rose 37% to $50 million from the $36 million posted in the first nine months of 1984.

“This is an exceptionally strong performance in what has traditionally been our slowest quarter,” said James Sweeney, chairman and chief executive officer, in a statement. “We have increased our patient base, our profitability, and our market share.”

Sweeney said Caremark is enthusiastic about America’s Pharmacy, its newly acquired mail order pharmaceutical business. However, he said, despite “rapid revenue growth,” he does not expect the new subsidiary to make a significant contribution to earnings in fiscal 1985.

“To grow America’s Pharmacy as rapidly as we want to, we’ll have to invest in expanded operations capabilities and in aggressive marketing programs,” Sweeney said. “It’s a business with enormous potential.”