Signature Home Care Group restructured its joint venture with VHA of New Jersey, which includes Memorial Hospital of Burlington County, Mount Holly; Newton (N.J.) Memorial Hospital; and Warren Hospital, Phillipsburg. Dallas-based Signature increased its equity position from a minority stake to 80%. Terms weren't disclosed. Signature, which previously was owned by Irving, Texas-based VHA, operates 17 home-care service centers in Arizona, Florida, Georgia, Kansas, Missouri, New Jersey, New Mexico and Texas.
Standard & Poor's Corp. has lowered its bond rating for Altoona, Pa.-based Mercy Regional Health System, formerly Mercy Hospital, to BBB from BBB+. Standard & Poor's said the downgrade and negative outlook relate to a steady downturn in finances and the prospects of further financial stress. The rating affects $20 million of debt. Separately, Moody's Investors Service upgraded Carolinas Hospital System in Florence, S.C., to Baa1 from Baa, affecting $13.8 million of debt. It also raised the rating on Paducah, Ky.-based Lourdes Hospital, now part of Mercy Health System in Cincinnati, to A1 from A, affecting $15.6 million of debt.
The Medstat Group, an Ann Arbor, Mich.-based data and decision-support vendor, posted record revenues and net income for its fiscal year ended Sept. 30. Revenues increased 22% to $64.9 million, including the pooling of interests from the acquisition of Dilts Kappeler Durham & Co. (Sept. 19, p. 13). After merger-related expenses of $885,000 were deducted, net income totaled $7.4 million, a 45% increase from 1993. Medstat's operating margin of 18.9% on operating income of $12.3 million was a decline from 20.1% on 1993 operating income of $10.7 million. The company said fourth-quarter operating margins were affected by lower-margin revenues from government and consulting clients.
Meditrust netted $132 million in a public stock offering last month. The Needham Heights, Mass.-based real estate investment trust sold 4.5 million shares at $30.88 per share. Proceeds will be used to repay short-term borrowings and invest in additional properties. Dean Witter Reynolds, PaineWebber and Smith Barney managed the offering. The REIT also recently closed a $46 million mortgage financing deal for 23 long-term-care facilities in Texas. Healthcare Centers of Texas, based in East Aurora, N.Y., will operate the facilities.
Health Management Associates, Naples, Fla., reported a 48% jump in net income to $11.3 million, or 24 cents per share, for the fourth quarter ended Sept. 30, compared with $7.6 million, or 17 cents per share, in the year-ago period. Revenues grew 21% to $108.6 million. For the year, the chain of 21 hospitals reported a 44% rise in profits to $46.5 million, or 98 cents per share, compared with $32.2 million, or 73 cents per share, in the previous fiscal year. Revenues were up 26% to $438.4 million. The year-end figures included a $2.6 million charge resulting from a change in accounting methods.