Summit Care Will Take $2.4-Million Charge

Shares of Burbank-based Summit Care Corp. fell as much as 19% after the company said it will take a charge of $2.4 million against fiscal second-quarter earnings due to reduced Medicare reimbursements. The provider of health-care services for the elderly also said it expects second-quarter profit from operations to fall 30% because of fewer residents and increased competition at its California nursing homes, as well as lower managed-care revenue. The charge will reduce per-share net income by 35 cents. The company said it decided to take the charge after Medicare proposed adjustments after auditing Summit Care’s fiscal 1995 records. Shares fell $2 to close at $13.50 on Nasdaq.