Large Safeguard Loss Jolts Analysts

ANAHEIM — Safeguard Health Enterprises Inc., the managed dental and vision care company, Thursday posted a loss of $6.1 million, or $1.30 a share, for the fourth quarter, jolting analysts who had expected earnings of about 25 cents.

The company took an $8.5-million pretax charge related to recent sales of 32 dental offices in the state. The charge included $5.6 million in increased reserves for notes the company issued dentists purchasing the California practices, which have since fallen into default. In the fourth quarter of 1996, the company earned $269,000, or 6 cents a share, in the same period a year earlier.

Revenues totaled $24.9 million, up 17% from $21.3 million.

Thomas C. Tekulve, chief financial officer, said he fielded calls all day Thursday from analysts seeking an explanation. He noted that the company’s stock dropped 75 cents a share to $9.50--a change he considered modest compared with the size of the loss.

The company also announced plans Thursday to sell off its network of 35 orthodontic offices in California. Tekulve said the fourth-quarter charge is expected to cover any costs associated with those proposed sales.

For the full year, the company reported a loss of $2.3 million, or 48 cents a share, compared with net income of $3.1 million, or 62 cents a share, the prior year. Revenue rose 32% to $97 million from $73.7 million.