Headquarters: 18331 Von Karman Ave.,
Suite 400, Irvine
Employees: 36,224; 179 in OC
Business: Nursing home operator
Market Value as of April 1: $360 million
Revenue for 12 months ended Dec. 31: $1.8 billion, up 17%
Net income for 12 months ended Dec. 31: $109.3 million, up 90%
Year in review: Sun Healthcare Group’s busy 2007, which included its $350 million deal for Harborside Healthcare Corp. of Boston, was followed up by a relatively quiet 2008. Sun operates nursing homes, short-term rehabilitation centers, a medical staffing arm and hospices.
Sun didn’t make a major deal last year. It did spend $7.7 million for Holisticare Hospice, a New Jersey hospice provider that it rolled into its SolAmor hospice chain.
In October, Sun embarked on a re-branding campaign, including a new logo. Chief Exe-cutive Richard Matros said that the campaign was put together to bring consistency to the company.
Sun also gave back in 2008, holding a major educational conference in New Orleans where nearly 100 of the company’s employees, with the assistance of Habitat for Hu-manity, built houses for residents who lost their homes to Hurricane Katrina.
What’s ahead: Sun sees its revenue for 2009 at $1.92 billion to $1.93 billion. The company expects its profits to come in at $50.4 million to $52.2 million. Analysts ex-pect Sun to make $48.7 million on revenue of $1.9 billion this year.
During Sun’s fourth-quarter conference call, Matros said that he would continue his involvement in Washington in 2009 on matters that concern the nursing home industry, namely on Medicare and Medicaid reimbursements. He chairs the board of the Alliance for Quality Nursing Home Care, a trade group.
“We found that our access has been terrific up there,” Matros said. “We’ve gotten a lot of time and personal attention from everybody from (House Speaker) Nancy Pelosi to (Senate Majority Leader) Harry Reid to Henry Waxman and a host of others who are in leadership positions. We would expect that to continue.”
Wall Street’s take: Sun, which had held its own in a somewhat fickle market for nursing homes, has seen its shares dip about 35% in the past 12 months. Sun’s share price decline came around the time Wall Street had its fall meltdown, but there were also other concerns: Its long-term debt totaled $708 million at the end of 2008 even though it doesn’t have looming near-term maturities.
Even with that, analysts have generally viewed the company positively, saying that it’s poised to capitalize on growing demand for its services as the population ages, as well as the role of Matros, who came to Sun around the time it emerged from bankruptcy protection in 2001.
Citigroup Inc. analyst Gary Taylor upgraded Sun in January, saying the company’s shares were undervalued. In a report, Taylor said he believed investors had discounted the stock for a more severe Medicare and Medi-caid reimbursement outlook than was probable. The government health programs ac-counted for $1.2 billion, or 67%, of Sun’s revenue last year.
,
Vita Reed
WHO’S IN CHARGE
RICHARD K. MATROS
Chief executive, Sun Healthcare Group
Joined company: 2001
Education: Attended graduate school at University of Southern California, master’s degree in gerontology.
Career: Served as chief executive and president of Santa Ana’s Bright Now Dental Inc., 1998 to 2000. Was at Regency Health Services Inc. from 1994 to 1997, including a two-year stint as its chief executive.
Notable: Native of Long Island, N.Y. Enjoys music, attending Lakers games and kickboxing.
