Oxford Health Plans Posts a Loss but Raises Hopes of Recovery
Oxford Health Plans Inc. said Monday that it lost $29 million, or 37 cents a diluted share, in the first quarter, in a report that raised hopes for the troubled managed-care company.
The loss contrasts with a profit of $34.4 million, or 42 cents, a year ago. Oxford late last year ran into billing and computer problems, which saddled it with heavy losses.
But the Norwalk, Conn., firm had been expected to report a loss of 62 cents a share, according to the average estimate of analysts polled by IBES International Inc., so the report heartened investors hoping for a recovery. Other estimates ranged from a loss of 16 cents to $1.06.
Oxford’s revenue rose 24% to $1.2 billion.
Enrollment jumped to 2.1 million, a 21% rise from a year ago and up 4% from the previous quarter, in another positive sign for analysts.
The company, led by health-care veteran Norman Payson, is trying to overhaul its troubled computer systems, bring in new management and repair frayed relations with doctors and hospitals.
The company is counting on getting a $350-million investment from Texas Pacific Group in return for an equity stake, once Oxford raises another $350 million in debt financing.
The company had a charge of $16.3 million, or 20 cents a share, in the first quarter for severance and restructuring costs, which would bring its loss to $45.3 million, or 57 cents a diluted share.
Oxford shares rose 50 cents to close at $16.94 on Nasdaq.
At a Glance
Other earnings, shown excluding one-time gains and charges unless otherwise noted:
* Baker Hughes’ fiscal second-quarter profit rose 37% to $79.3 million, or 46 cents a diluted share, from $58 million a year ago, matching estimates. Revenue rose 36% to $1.16 billion. The provider of drilling equipment and services to oil producers also said it is cutting about 400 jobs, or 1.7% of its work force, because demand for its oil field services in Venezuela did not rise as fast as expected.
* Safeco Corp.'s first-quarter profit fell 4% to $93.2 million, or 66 cents a diluted share, from a year earlier as the insurer paid a higher-than-expected level of weather-related claims. The results fell short of analysts’ estimate of 81 cents.
* St. Paul Cos.’ first-quarter earnings fell 4% to $125.4 million, or $1.36 a share, from a year earlier, as the property and casualty insurer suffered an increase in weather-related and malpractice insurance claims. Analysts had forecast $1.48.
* Sanwa Bank California, a unit of Japan’s Sanwa Bank, said its profit rose 22% to $25.8 million, on an increase in fee income, lending and core deposits. Non-interest income rose 10% to $20.6 million, and net interest income rose 5% to $90.3 million.
* Tricon Global Restaurants Inc.'s fiscal first-quarter earnings fell 17% as improved profit at its Pizza Hut and KFC restaurants weren’t enough to overcome the impact of weakened Asian currencies. Profit fell to $38 million, or 25 cents a diluted share, matching expectations, as sales fell 14% to $1.92 billion. Same-store sales rose 5% at Pizza Hut and 4% at KFC, but fell 3% at Taco Bell.
* Taubman Centers Inc., one of the nation’s largest shopping mall developers, said first-quarter earnings rose 7% to $13.9 million, or 27 cents a diluted share, from a year ago, as expected. Taubman, which operates as a real estate investment trust, did not report revenue.
* Tyson Foods Inc., the world’s largest poultry processor, said fiscal second-quarter profit fell 52% to $23.3 million, or 10 cents a diluted share, from a year ago, because of an excess supply of meat and lower demand for exports. Analysts had expected earnings of 12 cents. Revenue rose 19% to $1.87 billion.
* Union Carbide Corp. said first-quarter profit fell 8% to $142 million, or $1.01 a diluted share, from a year ago, beating estimates of 97 cents, on a 5% drop in revenue to $1.56 billion. It said its specialty chemical operations were strong, partly offsetting falling demand in Asia and lower prices for some plastics and chemicals.
* Western Digital Corp. reported a wider-than-expected fiscal third-quarter loss of $45 million, or 51 cents a diluted share, on a 25% drop in sales to $831 million, as the computer disk-drive maker struggled with plummeting prices and a transition to new products. Sales dropped 25%. The company had net income of $82.6 million, or 88 cents a share, a year ago.