Iasis Healthcare, Franklin, Tenn., said it wound up with a $56 million loss for its fiscal third quarter ended June 30 because its earnings were wiped out by costs associated with bringing in a new lead investor. The direct cost of Texas Pacific Group's purchase of a majority stake in the company was $19.8 million, covering legal and advisory expenses and bonuses, Iasis said. Privately held Iasis also incurred $51.9 million in costs for retiring debt early, also a result of the deal, which closed June 23. Because of those costs, Iasis lost $56 million for its fiscal third quarter, compared with profits of $82,000 in the year-ago quarter. The fiscal 2003 quarter included an $11.7 million asset impairment charge. Without charges, Iasis would have earned profits of $15.7 million in the 2004 third quarter and $11.8 million in the 2003 quarter. Third-quarter revenue was up 27.4% to $355.3 million. For the nine months, Iasis lost $36 million, compared with profits of $18.5 million in the year-ago period. Revenue was up 27.8% to $1.03 billion.
As a percentage of net patient revenue, Iasis reported bad-debt expense of 11.5% for the quarter and 11% for the nine months. That compared with 9.3% and 9%, respectively, for the fiscal 2003 quarter and nine-month period. On a same-hospital basis (covering 14 of the company's 15 hospitals), adjusted admissions rose 0.2% for the quarter and 0.8% for the nine months -- by Vince Galloro