Foundation Health Posts Higher Profit

Foundation Health Systems Inc. said its third-quarter earnings rose 20%, slightly better than expected, as it cut costs and widened profit margins. Woodland Hills-based provider of managed health-care services said net income rose to $68.9 million, or 57 cents a share, from $57.5 million, or 46 cents, a year ago. Revenue increased 4.3% to $1.92 billion from $1.84 billion. Foundation, formed in April through the merger of Foundation Health Corp. and Health Systems International Inc. to become one of the largest health-plan operators in the U.S., credited the higher earnings to cost savings from the combination. It also said the increase in the number of people enrolled in its plans helped drive earnings growth. The earnings were a penny more than the 56-cent average estimate of analysts. Foundation Health shares rose 88 cents to close at $30.63 on the New York Stock Exchange.