HCA acts on junk bond market. Taking advantage of a favorable junk bond market, Nashville-based HCA-The Healthcare Co. said last week that it sold $500 million of speculative-grade bonds. The company is expected to use proceeds of the 10-year notes to pay down debt. Standard & Poor's rating agency assigned a BB+ rating, the highest speculative grade, to the bonds, while Fitch, another rating agency, rated them BBB. Meanwhile, Province Healthcare Co., Brentwood, Tenn., has registered $150 million of convertible subordinated notes for certain noteholders. The shelf registration, filed last week with the Securities and Exchange Commission, allows holders of the securities to resell their notes over time and retain the profit.
HMA reports strong earnings. Health Management Associates, Naples, Fla., became the third hospital chain this year to signal strong earnings, reporting a 17% rise in first-quarter profits. The company said last week that its first-quarter net income rose to $40.2 million, or 16 cents per share, from $34.3 million, or 14 cents per share, for the year-ago quarter. Net patient revenue rose 17% to $434.2 million. The company's earnings release follows favorable financial news earlier this month from Tenet Healthcare Corp., Santa Barbara, Calif., and Universal Health Services, King of Prussia, Pa.