Kindred Healthcare, Louisville, Ky., reported second-quarter net income of $21.8 million, or 61 cents per share, after losing $43.4 million, or $1.25 per share, in the year-ago quarter, primarily because of losses on discontinued and divested operations. Per-share figures reflect a 2-for-1 stock split that took place in May. Revenue for the quarter rose 10% to $897 million. The company sold its Texas and Florida operations at a loss last year to quickly exit the markets, where liability costs were high. It's loss on discontinued and divested operations was $56.6 million in the 2003 second quarter, compared with $2.5 million in the 2004 quarter. Kindred cited improved admissions, greater operating efficiencies and reduced lengths of stay as additional factors in its stronger 2004 performance.
For the six months, Kindred earned net income of $35.6 million, or $1 per share, compared with a loss of $56.6 million, or $1.63 loss, in the first half of 2003. Revenue rose 9% to $1.8 billion. The company lowered its estimate for 2004 professional liability costs to $85 million to $90 million, from a prior prediction of $90 million to $100 million. Kindred operates more than 250 skilled-nursing centers, 60 long-term acute-care hospitals and 30 institutional pharmacies in 40 states. It also has contract rehabilitation services business. -- by Joseph Mantone