3rd-Quarter Profits, Sales Up for FHP

FHP International Corp. on Tuesday reported higher sales and earnings for the third quarter, attributing the gains to increased membership, higher rates and cost-cutting measures.

The Fountain Valley-based health maintenance organization posted earnings of $10.4 million for the quarter ended March 31, up from $9 million for the corresponding period last year. Revenue was up 27% to $338.2 million from $266.4 million a year earlier.

For the nine-month period, FHP earned $27.1 million, an increase of 22% from $22.3 million for the comparable year-earlier period. Revenue rose 35% to $944.3 million, up from $699 million a year earlier.

The company, which provides medical care in Southern California, Utah, Arizona, New Mexico and Guam, said its membership increased 18% over the previous 12 months, from 529,000 to 623,000.

Membership in the company’s Senior Plan for Medicare beneficiaries increased by about 29% in the same period, from 157,000 to 202,000.

The company recently opened six medical centers to accommodate its increased membership: three in Arizona, two in Southern California and one on the island of Guam.

FHP’S PERFORMANCE

In the third quarter ended March 31, FHP International Corp. reported net income of $10.4 million as its revenue jumped 27% to $338.2 million. The company attributed the gain to membership and rate increases, higher net interest income, and improved expense management.

Figures are in thousands, except per-share data.

3rd Qtr 3rd Qtr 9 Months 9 Months 1991 1990 1991 1990 Revenue $338,244 $266,446 $944,293 $699,040 Net income (loss) $10,397 $9,055 $27,141 $22,320 Per share (loss) $0.36 $0.32 $0.95 $0.78

Source: FHP International Corp.