IPC-the Hospitalist Co., a physician staffing firm, reported a 5% decrease in net income for the third quarter as expenses related to compensation and recruiting outpaced an increase in revenue.
But even its top-line growth didn't keep pace with expectations, and the company lowered its forecast for its projected 2014 revenue and earnings per share.
Acquisitions proved to be both a help and hindrance. The North Hollywood, Calif.-based company announced five deals in the third quarter; 38% of its revenue growth in the period came from new markets.
However, both its salary and benefit expenses as well as general and administrative expenses grew to represent a larger share of revenue than they did during the third quarter of 2013. Total operating expenses increased 15.8% year-over-year, the company reported.
IPC recorded net income of $8.6 million on revenue of $169.8 million in the third quarter, compared with $9.1 million in net income on $149.1 million in revenue during the year-ago period.
Although IPC did see top-line growth, it failed to meet Wall Street's expectations.
Its net revenue increased 14% overall—below analyst forecasts—and 9% in its existing markets. Patient encounters increased 15.9% overall, or 9.9% on a same-market basis.
IPC lowered its financial guidance for full-year 2014 to a range of $692 million to $698 million for revenue, and $2.23 to $2.29 for earnings per share. That compares to previous guidance of $720 million to $732 million in revenue, and $2.41 to $2.51 for earnings per share.
Follow Beth Kutscher on Twitter: @MHbkutscher
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