Dallas-based hospital Tenet Healthcare (NYSE: THC) reported a dramatic bounce back to profitability in the third quarter ending Sept. 30, although that was mostly attributable to tax benefits regarding carryover losses.
Tenet reported net income of $940 million on revenue of $2.2 billion for the quarter, compared to a year-ago quarterly loss of $1 million, also on $2.2 billion of revenue.
Despite the spike in net income, operating earnings were $203 million, down 37 percent from the $240 million in operating earnings reported for the third quarter of 2009.
Of Tenet's earnings, $981 million was attributable to new tax benefits regarding carryover losses that had previously been deferred.
"Recognition of the value of our deferred tax assets provided a significant boost to our net income in the third quarter and reflects the progress we have made in achieving sustained and sustainable profitability," said Tenet CEO Trevor Fetter in a statement. "The soft economy, however, continued to challenge our volume growth and exerted pressure on our operating margins."
Hospital admissions declined 3.5 percent during the quarter, while outpatient visits were down 2 percent. Meanwhile, operating expenses were up 2.4 percent.
Despite those numbers, Tenet did raise its projected operating earnings for 2010 slightly, to a range of between $1.05 and $1.1 billion.
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