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2 Months : From Feb 2020 to Apr 2020
By Chris Wack
Mednax Inc. shares were down 10% to $24 premarket after the company had contracts cancelled by affiliates of UnitedHealth and it reported earnings that missed analysts' expectations.
The company reported fourth-quarter earnings of $9.3 million, or 11 cents a share, compared with $60.2 million, or 68 cents a share, in the same period a year ago. Analysts polled by FactSet were looking for earnings of $41.3 million, or 59 cents a share.
Revenue for the quarter was $905.4 million, compared with last year's $888.4 million and the $901.2 million analysts were expecting.
Mednax also said it has received notification by entities affiliated with UnitedHealth Group that contracts of the company's affiliated practices across four states, covering all of the services that Mednax-affiliated physicians provide in those states, have been unilaterally terminated, with effective dates ranging from March 1 to Sept. 1, 2020.
Mednax said the total annual historical revenue under these contracts represents about 2% of its consolidated annual 2019 revenue of $3.5 billion.
Mednax said that given the unprecedented nature of these actions, it can't estimate the impact of these surprise terminations, which eliminate from United's networks Mednax-affiliated physicians providing anesthesia coverage, neonatology and high-risk obstetrics in urban and rural areas.
Write to Chris Wack at email@example.com
(END) Dow Jones Newswires
February 20, 2020 09:04 ET (14:04 GMT)
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