UnitedHealth Sales Rise Across Segments -- 2nd Update
January 15 2019 - 3:24PM
Dow Jones News
By Kimberly Chin and Anna Mathews
UnitedHealth Group Inc. said its sales rose in the fourth
quarter as the company continued to post diversified growth from
health-care-plan membership, premiums and a network of health
services.
Revenue increased 12% from a year earlier to $58.42 billion.
Analysts polled by Refinitiv were expecting sales of $58.01
billion. Revenue at the UnitedHealthcare segment rose 11% to $46.2
billion, while sales at the Optum segment increased 13% to 27.6
billion.
The parent of the nation's largest health insurer said net
earnings fell 16% to $3.04 billion, or $3.10 a share. Analysts had
expected the company to earn $3.05 a share.
On an adjusted basis, UnitedHealth reported profit of $3.28 a
share, compared with analysts' estimates of $3.21 a share.
However, during UnitedHealth's earnings call, analysts focused
on the insurance unit's medical-loss ratio, which reflects the
share of premiums that goes toward medical costs. The ratio was
slightly worse than some analysts had projected.
UnitedHealth Chief Executive David Wichmann said the result was
almost exclusively tied to Medicaid performance, particularly the
Temporary Assistance for Needy Families program in five states. He
said the results were affected by rates and cost issues, and
UnitedHealth is moving to fix both. Results on the Medicaid plans
improved in the second half of 2018 and "we expect 2019 to show
considerable additional improvement as we move that business back
to its target margin range," Mr. Wichmann said.
UnitedHealth affirmed its guidance for the full year. It expects
to report earnings of $13.70 to $14 a share, and adjusted earnings
of $14.40 to $14.70 a share. It also expects cash flows from
operations to be between $17.3 billion and $17.8 billion.
Shares in UnitedHealth, which have gained 8.5% in the past 12
months, were up 2.3% at $253.81 on Tuesday afternoon.
Write to Kimberly Chin at kimberly.chin@wsj.com and Anna Mathews
at anna.mathews@wsj.com
(END) Dow Jones Newswires
January 15, 2019 15:09 ET (20:09 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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