SAN JUAN, Puerto Rico,
Aug. 6, 2020 /PRNewswire/ -- Triple-S
Management Corporation (NYSE:GTS), a leading managed care company
in Puerto Rico, today announced
its second quarter 2020 results.
"We are proud of our team's tireless efforts to provide our
customers, providers and communities with quality health care
services and support as we all navigate through the COVID-19
pandemic," said Roberto
Garcia-Rodriguez, President and Chief Executive Officer.
"Through the expansion of virtual health care consultations and
home delivery of prescription drugs, food delivery to our elderly
population and protective equipment to providers, as well as our
focused efforts to enable the continuity of care for our most
vulnerable members, we are committed to ensuring the safety and
well-being of all our stakeholders in this challenging
environment."
"Our second quarter results reflected lower utilization caused
by the stay-at-home measures instituted by the government to combat
COVID-19," added Mr. Garcia-Rodriguez. "Utilization has begun
normalizing but will depend on the rate of progress containing the
coronavirus and re-opening the economy. While we anticipate
demand for deferred procedures to resume during the second half of
2020, we continue to be measured and thoughtful about our business,
and our focus squarely remains on ensuring current and prospective
members receive quality service and a superior health care
experience."
Second Quarter 2020 Consolidated Results and Other
Highlights
- Net income of $43.6 million, or
$1.87 per diluted share, versus net
income of $30.9 million, or
$1.35 per diluted share, in the
prior-year period;
- Adjusted net income of $40.9
million, or $1.76 per diluted
share, versus adjusted net income of $25.6
million, or $1.12 per diluted
share, in the prior-year period;
- Operating revenues of $875.5
million, a 0.4% decrease from the prior-year period,
primarily reflecting lower Managed Care net premiums earned;
- Consolidated loss ratio of 76.1%, a 610 basis-point decline
from the second quarter of 2019, reflecting lower Managed Care
utilization of services during the quarter as the result of the
government-enforced lockdown related to the COVID-19 pandemic;
- Medical loss ratio ("MLR") declined 510 basis points to
79.4%;
- Consolidated operating income was $43.7
million, compared to consolidated operating income of
$38.2 million in the prior-year
period;
- During the second quarter of 2020, the Company repurchased
375,373 shares at an aggregate cost of approximately $6.0 million, completing its share repurchase
program.
Selected Consolidated Quarterly Details
- Consolidated net premiums earned were $858.5 million, down 0.1% from the prior-year
period, primarily reflecting lower Managed Care premiums.
- Consolidated claims incurred were $653.1
million, down 7.5% year-over-year. Consolidated loss ratio
was 76.1%, 610 basis points lower than the prior-year period,
mostly reflecting a decline in Managed Care utilization of services
during the quarter as the result of the government-enforced
lockdown.
- Consolidated operating expenses of $178.7 million increased by $44.6 million, or 33.3%, from the prior-year
period, primarily reflecting an accrual of a potential litigation
loss in the Company's Managed Care segment and the reinstatement of
the HIP fee in 2020. The consolidated operating expense ratio was
20.7%, a 510 basis point increase from the prior-year quarter.
Selected Managed Care Segment Quarterly Details
- Managed Care premiums earned were $789.3
million, down 0.6% year-over-year.
-
- Medicare premiums earned of $372.4
million increased 1.7% from the prior-year period, largely
due to an increase of approximately 19,000 member months, which
primarily reflects a more competitive product offering, and an
increase in the average membership risk score. This increase in
premiums earned was partially offset by the recognition of
estimated premium rebates due to the lower MLR resulting from the
decreased utilization of services following the pandemic-related
lock-down.
- Commercial premiums earned of $195.8
million decreased 2.5% from the prior-year period, mainly
reflecting lower average premium rates and the recognition of
estimated premium rebates due to the decreased utilization of
services following the lock-down. These decreases were partially
offset by an increase in fully-insured enrollment during the
quarter of approximately 20,000 member months and the reinstatement
of the HIP Fee pass-through in 2020.
- Medicaid premiums earned of $221.1
million decreased 2.6% from the prior-year period, primarily
reflecting lower membership of approximately 15,000 member months.
In addition, the 2019 quarter included retroactive premiums related
to adjustments to the premium rates for high-cost high-need members
as part of an ongoing reconciliation with ASES.
- Reported MLR of 79.4% improved 510 basis points from the
prior-year period, primarily reflecting lower utilization of
services during the quarter as the result of the lockdown.
Update on P&C Segment Reserves related to Hurricane
María
As of June 30, 2020:
- Triple-S Propiedad, Inc. (TSP), the Company's P&C
subsidiary, has paid a cumulative amount of $757 million in claims and expenses related to
Hurricane María. Estimated gross losses remain unchanged at
$967 million.
- TSP received 3 new claims and closed 150 claims during the
second quarter of 2020. 505 claims remain open.
- The Company has been served with process with respect to 341 of
the 505 claims that remain open.
- As is the case for all claim liabilities, the gross losses
related to Hurricane Maria are based on the Company's best estimate
of the ultimate expected cost of claims with the information
currently on hand and are subject to change.
Liquidity
As of June 30, 2020, the Company
has cash and cash equivalents of $141.1
million. Triple-S's investment portfolio stood at
$1.7 billion as of June 30, of which 74% was in investment-grade
fixed income securities. The Company also believes it would be able
to access additional debt, if necessary, to further reinforce its
liquidity. In sum, the Company believes it remains well capitalized
to support its business operations throughout the pandemic and
beyond.
2020 Outlook
The Company is raising its full year 2020 guidance for adjusted
net income per diluted share to be between $2.80 and $3.00,
compared to its previous outlook for adjusted net income per
diluted share between $2.60 and
$2.80. The Company is currently
assuming a weighted average diluted share count for full year 2020
of 23.4 million shares and no further share repurchases.
Conference Call and Webcast
Management will host a conference call and webcast today at
8:30 a.m. Eastern Time to discuss its
financial results for the three months ended June 30, 2020. To participate, callers within the
U.S. and Canada should
dial 1-855-327-6837 and international callers should dial
1-631-891-4304 at least ten minutes before the call.
To listen to the webcast, participants should visit the
"Investor Relations" section of the Company's website at
www.triplesmanagement.com several minutes before the event is
broadcast and follow the instructions provided to ensure they have
the necessary audio application downloaded and installed. This
program is provided at no charge to the user. An archived version
of the call, also located on the "Investor Relations" section of
Triple-S Management's website, will be available about two hours
after the call ends and for at least the following two weeks. This
news release, along with other information relating to the call,
will be available on the "Investor Relations" section of the
website.
In addition, a replay will be available through August 20, 2020 by calling 1-844-512-2921 or
1-412-317-6671 and entering passcode 10010350. A replay will also
be available at www.triplesmanagement.com for 30 days.
About Triple-S Management Corporation
Triple-S Management Corporation is an independent licensee of
the Blue Cross Blue Shield Association. It is one of the leading
players in the managed care industry in Puerto Rico. Triple-S
Management has the exclusive right to use the Blue Cross Blue
Shield name and mark throughout Puerto
Rico, the U.S. Virgin
Islands, and Costa Rica. With over 60 years of
experience in the industry, Triple-S Management offers a broad
portfolio of managed care and related products in the Commercial,
Medicare Advantage, and Medicaid markets under the Blue Cross Blue
Shield marks. It also provides non-Blue Cross Blue Shield
branded life and property and casualty insurance in Puerto Rico. For more information about
Triple-S Management, visit www.triplesmanagement.com or contact
investorrelations@ssspr.com.
Non-GAAP Financial Measures
This earnings release presents information about the Company's
adjusted net income, which is a non-GAAP financial metric provided
as a complement to the results provided in accordance with
accounting principles generally accepted in the United States of America (GAAP). A
reconciliation of adjusted net income to net income, the most
comparable GAAP financial measure, is provided in the accompanying
tables found at the end of this release.
Forward-Looking Statements
This document contains forward-looking statements, as defined in
the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include information about possible or
assumed future sales, results of operations, developments,
regulatory approvals or other circumstances. Sentences that include
"believe", "expect", "plan", "intend", "estimate", "anticipate",
"project", "may", "will", "shall", "should" and similar
expressions, whether in the positive or negative, are intended to
identify forward-looking statements.
All forward-looking statements in this news release reflect
management's current views about future events and are based on
assumptions and subject to risks and uncertainties. Consequently,
actual results may differ materially from those expressed here as a
result of various factors, including all the risks discussed and
identified in public filings with the U.S. Securities and Exchange
Commission (SEC).
In addition, the Company operates in a highly competitive,
constantly changing environment, influenced by very large
organizations that have resulted from business combinations,
aggressive marketing and pricing practices of competitors, and
regulatory oversight. The following factors, if markedly different
from the Company's planning assumptions (either individually or in
combination), could cause Triple-S Management's results to differ
materially from those expressed in any forward-looking statements
shared here:
- Trends in health care costs and utilization rates
- Ability to secure sufficient premium rate increases
- Competitor pricing below market trends of increasing costs
- Re-estimates of policy and contract liabilities
- Changes in government laws and regulations of managed care,
life insurance or property and casualty insurance
- Significant acquisitions or divestitures by major
competitors
- Introduction and use of new prescription drugs and
technologies
- A downgrade in the Company's financial strength ratings
- Litigation or legislation targeted at managed care, life
insurance or property and casualty insurance companies
- Ability to contract with providers consistent with past
practice
- Ability to successfully implement the Company's disease
management, utilization management and Star ratings programs
- Ability to maintain Federal Employees, Medicare and Medicaid
contracts
- Volatility in the securities markets and investment losses and
defaults
- General economic downturns, major disasters, and epidemics
This list is not exhaustive. Management believes the
forward-looking statements in this release are reasonable. However,
there is no assurance that the actions, events or results
anticipated by the forward-looking statements will occur or, if any
of them do, what impact they will have on the Company's results of
operations or financial condition. In view of these uncertainties,
investors should not place undue reliance on any forward-looking
statements, which are based on current expectations. In addition,
forward-looking statements are based on information available the
day they are made, and (other than as required by applicable law,
including the securities laws of the
United States) the Company does not intend to update or
revise any of them in light of new information or future
events.
Readers are advised to carefully review and consider the various
disclosures in the Company's SEC reports.
Earnings Release
Schedules and Supplemental Information
|
Condensed
Consolidated Balance
Sheets.................................................................................
Exhibit I
|
Condensed
Consolidated Statements of
Earnings.....................................................................
Exhibit II
|
Condensed
Consolidated Statements of Cash
Flows................................................................
Exhibit III
|
Segment Performance
Supplemental
Information.....................................................................
Exhibit IV
|
Reconciliation of
Non-GAAP Financial
Measures......................................................................
Exhibit V
|
Exhibit
I
|
Condensed
Consolidated Balance Sheets
|
(dollar amounts in
thousands)
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2020
|
|
December 31,
2019
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments
|
|
$
|
1,755,698
|
|
$
|
1,643,637
|
Cash and cash
equivalents
|
|
|
141,071
|
|
|
109,837
|
Premium and other
receivables, net
|
|
|
547,209
|
|
|
567,692
|
Deferred policy
acquisition costs and value of business acquired
|
|
238,636
|
|
|
234,885
|
Property and
equipment, net
|
|
|
126,685
|
|
|
88,588
|
Other
assets
|
|
|
212,131
|
|
|
174,187
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
3,021,430
|
|
$
|
2,818,826
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policy liabilities
and accruals
|
|
$
|
1,470,558
|
|
$
|
1,425,477
|
Accounts payable and
accrued liabilities
|
|
|
501,397
|
|
|
370,483
|
Short-term
borrowings
|
|
|
15,000
|
|
|
54,000
|
Long-term
borrowings
|
|
|
54,940
|
|
|
25,694
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
2,041,895
|
|
|
1,875,654
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
Common
stock
|
|
|
23,438
|
|
|
23,800
|
|
Other stockholders'
equity
|
|
|
956,807
|
|
|
920,065
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Triple-S
Management Corporation stockholders' equity
|
|
980,245
|
|
|
943,865
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interest in consolidated subsidiary
|
|
|
(710)
|
|
|
(693)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
equity
|
|
|
979,535
|
|
|
943,172
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
|
$
|
3,021,430
|
|
$
|
2,818,826
|
Exhibit
II
|
Condensed
Consolidated Statements of Earnings
|
(dollar amounts in
thousands, except per share data)
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Six Months
Ended
|
|
|
|
|
|
|
|
|
June
30,
|
|
June
30,
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Premiums earned,
net
|
|
$
|
858,535
|
|
$
|
859,493
|
|
$
|
1,734,432
|
|
$
|
1,627,495
|
|
Administrative
service fees
|
|
|
2,809
|
|
|
2,456
|
|
|
5,003
|
|
|
5,088
|
|
Net investment
income
|
|
|
13,815
|
|
|
15,062
|
|
|
28,126
|
|
|
30,438
|
|
Other operating
revenues
|
|
|
303
|
|
|
1,591
|
|
|
4,342
|
|
|
3,168
|
|
|
Total operating
revenues
|
|
|
875,462
|
|
|
878,602
|
|
|
1,771,903
|
|
|
1,666,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized
investment (losses) gains
|
|
|
(221)
|
|
|
2,364
|
|
|
(687)
|
|
|
3,679
|
|
Net unrealized
investment gains (losses) on equity investments
|
|
|
28,338
|
|
|
3,323
|
|
|
(28,468)
|
|
|
22,992
|
|
Other income,
net
|
|
|
801
|
|
|
1,705
|
|
|
4,406
|
|
|
2,874
|
|
|
Total
revenues
|
|
|
904,380
|
|
|
885,994
|
|
|
1,747,154
|
|
|
1,695,734
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits and
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Claims
incurred
|
|
|
|
653,087
|
|
|
706,304
|
|
|
1,367,609
|
|
|
1,329,494
|
|
Operating
expenses
|
|
|
178,659
|
|
|
134,084
|
|
|
340,860
|
|
|
266,747
|
|
|
Total operating
costs
|
|
|
831,746
|
|
|
840,388
|
|
|
1,708,469
|
|
|
1,596,241
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
1,864
|
|
|
1,831
|
|
|
3,717
|
|
|
3,619
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total benefits and
expenses
|
|
|
833,610
|
|
|
842,219
|
|
|
1,712,186
|
|
|
1,599,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
|
70,770
|
|
|
43,775
|
|
|
34,968
|
|
|
95,874
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
27,181
|
|
|
12,849
|
|
|
17,531
|
|
|
30,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
|
43,589
|
|
|
30,926
|
|
|
17,437
|
|
|
65,709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to the non-controlling interest
|
|
|
(10)
|
|
|
(5)
|
|
|
(17)
|
|
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Triple-S Management Corporation
|
|
$
|
43,599
|
|
$
|
30,931
|
|
$
|
17,454
|
|
$
|
65,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Triple-S Management Corporation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per
share
|
|
$
|
1.88
|
|
$
|
1.35
|
|
$
|
0.75
|
|
$
|
2.88
|
|
Diluted net income
per share
|
|
$
|
1.87
|
|
$
|
1.35
|
|
$
|
0.75
|
|
$
|
2.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average of
common shares
|
|
|
23,193,626
|
|
|
22,830,399
|
|
|
23,287,787
|
|
|
22,794,297
|
|
Diluted weighted
average of common shares
|
|
|
23,271,303
|
|
|
22,895,000
|
|
|
23,372,985
|
|
|
22,866,691
|
Exhibit
III
|
Condensed
Consolidated Statements of Cash Flows
|
(dollar amounts in
thousands)
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended
|
|
|
|
June
30,
|
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$
|
170,282
|
|
$
|
26,305
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Proceeds from
investments sold or matured:
|
|
|
|
|
|
|
|
|
Securities available
for sale:
|
|
|
|
|
|
|
|
|
|
Fixed maturities
sold
|
|
|
66,316
|
|
|
315,495
|
|
|
|
Fixed maturities
matured/called
|
|
|
18,752
|
|
|
14,420
|
|
|
Securities held to
maturity - fixed maturities matured/called
|
|
|
339
|
|
|
1,178
|
|
|
Equity investments
sold
|
|
|
72,775
|
|
|
70,054
|
|
|
Other invested assets
sold
|
|
|
11,814
|
|
|
2,096
|
|
Acquisition of
investments:
|
|
|
|
|
|
|
|
|
Securities available
for sale - fixed maturities
|
|
|
(91,930)
|
|
|
(291,533)
|
|
|
Securities held to
maturity - fixed maturities
|
|
|
(340)
|
|
|
(539)
|
|
|
Equity
investments
|
|
|
(160,104)
|
|
|
(67,560)
|
|
|
Other invested
assets
|
|
|
(20,799)
|
|
|
(15,424)
|
|
Increase in other
investments
|
|
|
(2,400)
|
|
|
(2,692)
|
|
Net change in policy
loans
|
|
|
(97)
|
|
|
(771)
|
|
Net capital
expenditures
|
|
|
(45,927)
|
|
|
(10,659)
|
|
Capital contribution
on equity method investees
|
|
|
(4,933)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Net cash (used in)
provided by investing activities
|
|
|
(156,534)
|
|
|
14,065
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Change in outstanding
checks in excess of bank balances
|
|
|
34,024
|
|
|
13,189
|
|
Repayments of
short-term borrowings
|
|
|
(39,000)
|
|
|
-
|
|
Proceeds from
long-term borrowings
|
|
|
30,841
|
|
|
-
|
|
Repayments of
long-term borrowings
|
|
|
(1,618)
|
|
|
(1,613)
|
|
Repurchase and
retirement of common stock
|
|
|
(14,982)
|
|
|
(1)
|
|
Proceeds from
policyholder deposits
|
|
|
16,421
|
|
|
8,204
|
|
Surrender of
policyholder deposits
|
|
|
(8,200)
|
|
|
(11,421)
|
|
|
|
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
|
17,486
|
|
|
8,358
|
|
|
|
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
|
31,234
|
|
|
48,728
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
|
109,837
|
|
|
117,544
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
|
$
|
141,071
|
|
$
|
166,272
|
Exhibit
IV
|
|
Segment
Performance Supplemental Information
|
|
(Unaudited)
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
(dollar amounts in
millions)
|
2020
|
2019
|
Percentage
Change
|
|
2020
|
2019
|
Percentage
Change
|
Premiums earned,
net:
|
|
|
|
|
|
|
|
|
Managed
Care:
|
|
|
|
|
|
|
|
|
|
Commercial
|
$
195.8
|
$
200.8
|
(2.5%)
|
|
$
396.9
|
$
399.3
|
(0.6%)
|
|
|
Medicare
|
372.4
|
366.0
|
1.7%
|
|
760.2
|
698.6
|
8.8%
|
|
|
Medicaid
|
221.1
|
227.0
|
(2.6%)
|
|
442.0
|
401.4
|
10.1%
|
|
|
|
Total Managed
Care
|
789.3
|
793.8
|
(0.6%)
|
|
1,599.1
|
1,499.3
|
6.7%
|
|
Life
Insurance
|
48.1
|
45.0
|
6.9%
|
|
94.8
|
89.2
|
6.3%
|
|
Property and
Casualty
|
22.4
|
21.8
|
2.8%
|
|
43.0
|
41.1
|
4.6%
|
|
Other
|
(1.3)
|
(1.1)
|
(18.2%)
|
|
(2.5)
|
(2.1)
|
(19.0%)
|
|
|
|
|
Consolidated premiums
earned, net
|
$
858.5
|
$
859.5
|
(0.1%)
|
|
$
1,734.4
|
$
1,627.5
|
6.6%
|
Operating revenues
(losses): 1
|
|
|
|
|
|
|
|
|
Managed
Care
|
$
797.4
|
$
802.9
|
(0.7%)
|
|
$
1,615.5
|
$
1,518.0
|
6.4%
|
|
Life
Insurance
|
54.9
|
51.8
|
6.0%
|
|
108.5
|
102.6
|
5.8%
|
|
Property and
Casualty
|
24.7
|
24.1
|
2.5%
|
|
47.4
|
46.0
|
3.0%
|
|
Other
|
(1.5)
|
(0.2)
|
(650.0%)
|
|
0.5
|
(0.4)
|
225.0%
|
|
|
|
|
Consolidated
operating revenues
|
$
875.5
|
$
878.6
|
(0.4%)
|
|
$
1,771.9
|
$
1,666.2
|
6.3%
|
Operating income
(loss): 2
|
|
|
|
|
|
|
|
|
Managed
Care
|
$
29.3
|
$
29.3
|
0.0%
|
|
$
43.5
|
$
51.4
|
(15.4%)
|
|
Life
Insurance
|
9.5
|
5.2
|
82.7%
|
|
14.5
|
10.9
|
33.0%
|
|
Property and
Casualty
|
6.7
|
4.8
|
39.6%
|
|
6.5
|
8.3
|
(21.7%)
|
|
Other
|
(1.8)
|
(1.1)
|
(63.6%)
|
|
(1.1)
|
(0.6)
|
(83.3%)
|
|
|
|
|
Consolidated
operating income
|
$
43.7
|
$
38.2
|
14.4%
|
|
$
63.4
|
$
70.0
|
(9.4%)
|
Operating margin:
3
|
|
|
|
|
|
|
|
|
Managed
Care
|
3.7%
|
3.6%
|
10 bp
|
|
2.7%
|
3.4%
|
-70 bp
|
|
Life
Insurance
|
17.3%
|
10.0%
|
730 bp
|
|
13.4%
|
10.6%
|
280 bp
|
|
Property and
Casualty
|
27.1%
|
19.9%
|
720 bp
|
|
13.7%
|
18.0%
|
-430 bp
|
|
Consolidated
|
5.0%
|
4.3%
|
70 bp
|
|
3.6%
|
4.2%
|
-60 bp
|
Depreciation and
amortization expense
|
$
3.8
|
$
3.5
|
8.6%
|
|
$
7.7
|
$
7.0
|
10.0%
|
|
1 Operating revenues include premiums
earned, net, administrative service fees and net investment
income.
|
2 Operating income or loss include
operating revenues minus operating costs. Operating costs include
claims incurred and operating expenses.
|
3 Operating margin is defined as
operating income or loss divided by operating revenues.
|
Managed Care
Additional Data
|
|
|
|
|
|
|
Three months
ended
June 30,
|
|
Six months
ended
June 30,
|
(Unaudited)
|
|
2020
|
2019
|
|
2020
|
2019
|
Member months
enrollment:
|
|
|
|
|
|
|
Commercial:
|
|
|
|
|
|
|
|
Fully-insured
|
975,212
|
955,463
|
|
1,953,554
|
1,908,515
|
|
|
Self-insured
|
327,030
|
353,961
|
|
657,262
|
716,451
|
|
|
|
Total
Commercial
|
1,302,242
|
1,309,424
|
|
2,610,816
|
2,624,966
|
|
Medicare
Advantage
|
405,203
|
385,835
|
|
813,110
|
769,443
|
|
Medicaid
|
|
1,077,456
|
1,092,132
|
|
2,145,472
|
2,121,868
|
|
|
|
|
Total member
months
|
2,784,901
|
2,787,391
|
|
5,569,398
|
5,516,277
|
Claim liabilities
(in millions)
|
|
|
|
$
349.1
|
$
423.1
|
Days claim
payable
|
|
|
|
49
|
61
|
Premium
PMPM:
|
|
|
|
|
|
|
Managed
Care
|
$
321.13
|
$
326.21
|
|
$
325.54
|
$
312.37
|
|
|
Commercial
|
200.78
|
210.16
|
|
203.17
|
209.22
|
|
|
Medicare
Advantage
|
919.05
|
948.59
|
|
934.93
|
907.93
|
|
|
Medicaid
|
205.21
|
207.85
|
|
206.02
|
189.17
|
Medical loss
ratio:
|
79.4%
|
84.5%
|
|
81.6%
|
84.1%
|
|
Commercial
|
67.5%
|
80.9%
|
|
73.0%
|
81.9%
|
|
Medicare
Advantage
|
77.2%
|
82.4%
|
|
80.0%
|
81.5%
|
|
Medicaid
|
|
93.7%
|
91.1%
|
|
92.0%
|
90.7%
|
Adjusted medical loss
ratio: 1
|
|
76.9%
|
85.7%
|
|
80.5%
|
85.5%
|
|
Commercial
|
|
67.5%
|
83.6%
|
|
72.8%
|
83.4%
|
|
Medicare
Advantage
|
|
74.6%
|
82.9%
|
|
78.1%
|
81.3%
|
|
Medicaid
|
|
89.3%
|
92.2%
|
|
92.0%
|
94.2%
|
Operating expense
ratio:
|
|
|
|
|
|
|
Consolidated
|
20.7%
|
15.6%
|
|
19.6%
|
16.3%
|
|
Managed
Care
|
17.8%
|
12.9%
|
|
16.6%
|
13.7%
|
|
1 The
adjusted medical loss ratio accounts for subsequent adjustments to
estimates, such as prior-period reserve developments and Medicare
premium adjustments, and presents them in their corresponding
period.
|
Managed Care
Membership by Segment
|
|
|
|
|
|
|
As of June
30,
|
|
|
|
|
|
|
2020
|
2019
|
Members:
|
|
|
|
Commercial:
|
|
|
|
|
Fully-insured
|
324,489
|
318,429
|
|
|
Self-insured
|
108,982
|
117,978
|
|
|
|
Total
Commercial
|
433,471
|
436,407
|
|
Medicare
Advantage
|
134,601
|
128,670
|
|
Medicaid
|
364,157
|
364,495
|
|
|
|
|
Total
members
|
932,229
|
929,572
|
Exhibit
V
|
|
Reconciliation of
Non-GAAP Financial Measures
|
|
|
|
|
|
|
|
Adjusted Net
Income
|
(Unaudited)
|
|
Three months
ended
June 30,
|
Six months
ended
June 30,
|
(dollar amounts in
millions)
|
2020
|
2019
|
|
2020
|
2019
|
Net income
|
|
$
43.6
|
$
30.9
|
|
$
17.4
|
$
65.7
|
Less
adjustments:
|
|
|
|
|
|
|
Net realized
investment (losses) gains, net of tax
|
(0.2)
|
1.9
|
|
(0.6)
|
2.9
|
|
Unrealized gains
(losses) on equity investments
|
22.7
|
2.7
|
|
(22.8)
|
18.4
|
|
Contingency
accrual
|
(20.0)
|
-
|
|
(20.0)
|
-
|
|
Private equity
investment income, net of tax
|
0.2
|
0.7
|
|
2.3
|
1.0
|
|
|
Adjusted net
income
|
$
40.9
|
$
25.6
|
|
$
58.5
|
$
43.4
|
|
|
Diluted adjusted net
income per share
|
$
1.76
|
$
1.12
|
|
$
2.50
|
$
1.90
|
Adjusted net income is a non-GAAP financial metric and should
not be considered a substitute for, or superior to, financial
measures calculated in accordance with GAAP. Management
believes that the use of this adjusted net income and adjusted net
income per share provides investors and management useful
information about the earnings impact of realized and unrealized
investment gains or losses, as well as other non-recurring items
impacting the Company's results of operations. This non-GAAP
metric does not consider all the items associated with the
Company's operations as determined in accordance with GAAP.
As a result, one should not consider these measures in
isolation.
FOR FURTHER
INFORMATION:
|
|
|
AT THE
COMPANY:
|
INVESTOR
RELATIONS:
|
Juan José
Román-Jiménez
|
Mr. Garrett
Edson
|
EVP and Chief
Financial Officer
|
ICR
|
(787)
749-4949
|
(787)
792-6488
|
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SOURCE Triple-S Management Corporation