DOW JONES NEWSWIRES 
 

Tenet Healthcare Corp. (THC) swung to a first-quarter profit, helped by various gains, cost controls and a smaller decline in admissions.

It reiterated its 2009 outlook, boosted last month, saying it remains "cautious" about the softer economy's impact, particularly on commercial managed-care admissions. Last month, Chief Executive Trevor Fetter credited the company's cost controls for helping to produce a "very strong first quarter" and Tenet's highest operating margin in six years.

Shares rose 20% premarket to $3. The stock has more than doubled this year.

The results suggest that Tenet could be starting to see some benefit from its struggle to gain its footing after settling government probes in 2006 over past pricing plans. It has changed management, shed hospitals and made improvements that earned it good-quality ratings from the Department of Health and Human Services. In the past it has battled high supply costs, delays in key asset sales and high debt levels.

Tenet swung to a profit of $178 million, or 37 cents a share, from a year-earlier loss of $31 million, or 6 cents a share. Its April view was earnings of 37 cents, including a net 29 cents in gains related to taxes, legal costs and debt extinguishment. Analysts surveyed by Thomson Reuters expected per-share earnings of 3 cents.

Revenue increased 4.6% to $2.3 billion, in line with the company's February estimate, which was below analysts' views at the time.

Hospitals have struggled for years with tepid volumes of commercially insured patients and large numbers of uninsured patients who can't pay their medical bills. Now, the credit crisis has prompted many hospitals to delay capital spending and the recession threatens to further erode business.

Same-hospital adjusted earnings before interest, taxes, depreciation and amortization, the industry benchmark used to track the financial performance of those hospitals under a company's wing for more than a year, rose 28%.

In April, Tenet said first-quarter same-hospital admissions fell 1.3% as same-hospital managed-care admissions declined 3.2%. Same-hospital outpatient visits edged up 0.7%.

-By Mike Barris, Dow Jones Newswires; 201-938-5658; mike.barris@dowjones.com