Universal Hospital Services reported another 12 months of disappointing financial results with the healthcare technology and medical-device supplier recording a net loss of $66.5 million for the year ended Dec. 31, 2014.
Despite higher overall revenue of $436.7 million, up nearly 2% from $428.4 million a year ago, the company's net loss grew by nearly 55%. Expenses were up across all three segments, outpacing revenue growth in the company's clinical engineering and surgical services divisions.
Universal Hospital Services' largest segment, which provides medical-equipment-outsourcing services to more than 7,000 healthcare providers, stayed flat. For the second year in a row, the Minneapolis-based company reported revenue of $285.5 million for the segment, which represents about two-thirds of its business.
But that division has faced challenges recently as more hospitals and providers are directly purchasing, leasing and managing their own equipment, rather than relying on outsourcing.
In July, the company learned that a national group purchasing organization had awarded an expiring equipment contract to one of its competitors. Its effect on Universal Hospital Services' 2014 loss in revenue was relatively minimal at just $400,000, but the effect on 2015 results is expected to drag down revenue by $15 million to $20 million.
That could be concern for a company that is already operating in the red with a 2014 operating loss of $25.8 million. That, coupled with interest expense of more than $53 million, left Universal Hospital Services with a pre-tax loss of $79.1 million for the year. It's nearly double the $42.5 million loss suffered in 2013.
Gary Blackford, chairman and CEO, announced in August that he would be stepping down from his roles after 12 years with the company, just several months after William Mixon, president of the company's medical equipment division, also resigned.
This week, Universal Hospital Services appointed a new chief executive to take the role left vacant by Blackford on Feb. 6. Thomas Leonard, 47, and most recently president of medical systems for CareFusion Corp., will assume the top leadership position at Universal Hospital Services April 13.