FHP International’s 2nd-Quarter Earnings Rise to $10.3 Million

FHP International Corp., holding a line on costs while adding new members to its health maintenance organization, said Thursday that its second-quarter earnings rose 66% to $10.3 million, or 31 cents a share.

This compares to net income of $6.2 million, or 19 cents a share, for the previous year’s second quarter. Revenue grew 27% for the three-month period ended Dec. 31 to $591.1 million.

The 33-year-old company attributed its quarterly revenue gain to a 14% enrollment growth, particularly in its Southern California, Utah and Nevada service areas.

“This is a good improvement. It shows that FHP is continuing to work on its cost structure,” said Mary O’Connell, an industry analyst at Louis Nicoud Associates in San Francisco.

FHP, one of the state’s larger HMOs, posted six-month net income of $21.5 million, or 64 cents a share, up from a profit of $12.6 million, or 38 cents a share, for the first half of its previous fiscal year. Revenue rose 32% to $1.2 billion, from $908.7 million.

Last month, FHP offered to acquire TakeCare Inc. in Concord for $829 million in cash and stock, or a value of $62 a share. The bid was lower than a stock-swap offer valued at $64.50 a share from United HealthCare Corp. in Minnesota, but TakeCare directors accepted FHP’s offer. A shareholder lawsuit to block the sale to FHP is pending.