UnitedHealth profit surges 13 percent in third quarter, tops earnings estimates

Before you go, we thought you'd like these...
UnitedHealth profit surges 13 percent in third quarter, tops earnings estimatesUnitedHealth Group Inc. (UNH) on Tuesday reported higher third-quarter earnings, despite dwindling commercial enrollment in employer-sponsored health plans as U.S. jobs cuts mounted. The nation's largest health insurer reported it earned $1.04 billion, up 13 percent from $920 million a year ago.

On a per-share basis, the Minnetonka, Minn.-based company earned 89 cents a share, compared to 75 cents a share a year ago. UnitedHealth had been expected to report third-quarter earnings of 76 cents a share, according to a consensus estimate of 19 analysts polled by Zacks.com. The company is the first of the nation's large health insurers to report earnings.
Total revenues rose to $21.7 billion in the three months ending Sept. 30, up from $20.2 billion during the same period a year ago. UnitedHealth said the earnings jump was aided by overall cost containment and a business model that is helping the company weather a bad economy.

Commercial enrollment fell more than 6 percent, to 24.8 million, as job losses escalated, sending revenues within the UnitedHealthcare division down 3 percent to $10.1 billion, UnitedHealth said. The latest decline followed a similar enrollment drop in the second quarter.

Revenues at the company's Ovations unit, which supplies services to patients over 50, rose 19 percent to $7.9 billion. Within the company's AmeriChoice division, which provides health benefits and services to Medicaid recipients, revenue rose 29 percent to $2.1 billion.

Total enrollment in the company's public and senior plans rose to 7.2 million from 6.3 million, UnitedHealthcare said.

UnitedHealth confirmed full-year earnings of $3.15 a share and anticipates cash flows of $5 billion from operations. Zacks.com expects the company to earn $3.09 a share in 2009, based on a consensus estimate of 23 analysts polled.

Shares of the company were higher in pre-market trading Tuesday ahead of the opening bell on Wall Street, climbing 5.5 percent to $26.30 a share.
Read Full Story

People are Reading