DaVita quarterly profit down slightly - CFO steps down

[okarol]

UPDATE 1-DaVita quarterly profit down slightly
Thu Nov 1, 2007 4:59pm EDT

(Adds CFO change, details on results, forecast, stock activity)

LOS ANGELES, Nov 1 (Reuters) - DaVita Inc (DVA.N: Quote, Profile, Research), the biggest owner of dialysis clinics in the United States, said on Thursday quarterly net income was down from a year ago and that 2008 operating income could be at the low end of its forecast.

The company also said Mark Harrison would step down as chief financial officer effective Nov 30.

Jim Hilger, the company's vice president and controller, will assume the additional role of acting chief financial officer.

DaVita had third-quarter net income of $94.5 million, or 88 cents per share, compared with net income of $94.9 million, or 90 cents per share, in the year-earlier quarter.

The company, based in El Segundo, California, said adjusted earnings for the quarter were 83 cents per share, a penny short of analysts' average estimate, according to Reuters Estimates.

Net operating revenue was up slightly to $1.3 billion from $1.2 billion a year ago.

Wall Street has been closely monitoring how a controversy over the safety of anemia drugs will impact DaVita, which runs more than 1,300 dialysis clinics in the United States.

The U.S. Food and Drug Administration earlier this year put its strongest black box warning on the drugs, made by Amgen Inc (AMGN.O: Quote, Profile, Research) and Johnson & Johnson (JNJ.N: Quote, Profile, Research), and the government agency overseeing Medicare and Medicaid -- which covers many dialysis patients - said it would pare coverage for the drugs.

Sales of Amgen's Epogen, used to treat anemia in people with kidney disease, fell 5 percent to $602 million in the third quarter.

DaVita forecast fourth quarter operating income in the range of $190 million to $200 million. It also narrowed its forecast for operating income for 2007 to a range of $800 million to $810 million.

It maintained its operating income guidance for 2008, excluding the impact of any potential Medicare legislation, at $790 million to $850 million, but said it now expects it to be at the lower end of the range.

Shares of DaVita closed up 26 cents at $65.45 on the New York Stock Exchange before the company issued its results. (Reporting by Lisa Baertlein)

http://www.reuters.com/article/marketsNews/idUSN0158818320071101

[Rerun]

Let's see if the guy leaving cashes out all his stocks like the Enron guy. 

If something smells fishy it is usually fish!

[Black]

If there is scrutiny over the Epo use, what else will come to light?

[Sluff]

He's made his millions.

[Aldente]

These stories drive me crazy.  DaVita earned A LOT of money but not as much as analysts expected so heads roll, people lose jobs and the quality of service goes down to cut costs.  In my opinion there is a big difference between maximum profits and acceptable profits.  Stockholders want maximum profits but they are not the ones hooked up to the dialysis machines.  Acceptable profits, on the other hand, make money for the company and its investors while leaving enough money to maintain acceptable levels of care.

Take a look at http://www.forbes.com/lists/2006/12/IPFN.html to see what the CEO of DaVita makes.  Ask any of the dialysis techs or nurses if they make anywhere near $27.88 million a year?

When issues of profit margin and acceptable levels of care arise, business decisions and profits alone should not be left untempered but guided by moral principles.  Shamefully obscene salaries of executives soar while dialysis centers maintain minimum levels of staffing and have a high turnover rate because of burnout and poor pay.

Okay, Okay...  I'll get off of my soapbox.

[qwerty]

These stories drive me crazy.  DaVita earned A LOT of money but not as much as analysts expected so heads roll, people lose jobs and the quality of service goes down to cut costs.  In my opinion there is a big difference between maximum profits and acceptable profits.  Stockholders want maximum profits but they are not the ones hooked up to the dialysis machines.  Acceptable profits, on the other hand, make money for the company and its investors while leaving enough money to maintain acceptable levels of care.

Take a look at http://www.forbes.com/lists/2006/12/IPFN.html to see what the CEO of DaVita makes.  Ask any of the dialysis techs or nurses if they make anywhere near $27.88 million a year?

When issues of profit margin and acceptable levels of care arise, business decisions and profits alone should not be left untempered but guided by moral principles.  Shamefully obscene salaries of executives soar while dialysis centers maintain minimum levels of staffing and have a high turnover rate because of burnout and poor pay.

Okay, Okay...  I'll get off of my soapbox.

I'm one of those charge nurses caught in the "panic" of the upper henchmen so to speak. In the last 2 weeks I have seen and heard the panic through our FA and our regional also. Opening with one less staff member and closing with 2 less daily. I have seen so many mistakes and errors in the last 2 weeks in our facility then I have seen in my entire career as a nurse in over 20 years experience. Now updating a resume and ready to leave based primarily on these unsafe and purely outrageous "cutbacks" of which you as the pt will be the ones to suffer to make up for that almighty profit dollar loss.  HOw much will they be willing to pay out due to a pt death or injury in the long run? I'm running before I lose my license in the mist of thier panic due to mistakes by some who wont even accept that they made one or more.

[Chris]

I never heard of DaVita until I came here. If I have to go back on dialysis and can't go back to my old clinic, my first question would be, "Are you run by DaVita?" If so, I'm running, reading to many bad things on here about care and ow ith cutbacks, they'll most likey never rehire as many people for saftey sake. unless forced too.