Paracelsus Healthcare Corp. last week restated its financial results for the past six years and announced the departure of Chief Executive Officer Ron Messenger.
The company also reported the possible sale or closure of two of its 30 hospitals, including PHC Regional Medical Center in Salt Lake City.
An internal committee cited "accounting errors and irregularities" as the reason for the restated figures and recommended the board adopt internal controls to prevent a recurrence.
A published report said Messenger was replaced by Charles Miller, a former executive of Champion Healthcare Corp., which Paracelsus acquired last August. Paracelsus' Houston headquarters was closed on Friday, so the change couldn't be confirmed.
The company reported a net loss of $144.6 million, or $2.64 per share, for the fourth quarter ended Dec. 31, 1996. Results had been delayed due to a six-month internal investigation. The quarter's loss includes $38.1 million in anticipated losses at PHC Regional under a capitation contract with FHP International Corp., the company said. Paracelsus took $59 million in charges largely to accelerate depreciation on PHC Regional and Senatobia (Miss.) Community Hospital, citing the possible sale or closure of both facilities.
Following the internal probe, the company revised downward its net income for the three years before going public in August 1996. Net income for 1995 was $1.4 million, 89% less than the $13 million previously reported.
For the fourth quarter of 1996, the company posted a 32% increase in revenues to $154.1 million compared with the year-ago quarter. Net income for fourth quarter 1995 totaled $2 million, or 7 cents per share.
For the year ended Dec. 31, the company reported a net loss of $154.5 million, or $3.94 per share, on revenues of $493.1 million. That compares with net income of $6.3 million, or 21 cents per share, on revenues of $434.1 million in 1995.