UnitedHealth Ups Earnings Outlook on Healthy Q1 Report

All aspects of UnitedHealth’s operations showed growth, leading to a profitable first quarter and revised expectations for 2018.

UnitedHealth Group Inc., released its first-quarter earnings report Tuesday, highlighted by $55.2 billion in revenues, a 13.3% increase year-over-year, as well as every business reporting double-digit percentage earnings growth.

Earnings from operations totalled $4.1 billion, an 18.8% increase; cash flows from operations were $8.4 billion; adjusted cash flows from operations were $3.2 billion; and adjusted net earnings of $3.04 per share grew 28.3% year-over-year.

Additionally, first quarter net earnings of $2.87 per share grew 28.7% year-over-year, leading the organization to increase its outlook for 2018. Now, net earnings are projected to range between $11.70 to $11.95 per share while adjusted net earnings range from $12.40 to $12.65.

David Wichmann, CEO of UnitedHealth Group, heralded the insurer’s earnings report as a sign of productive operations and growth in target areas.

“Through the intense focus our 285,000 colleagues bring to helping people live healthier lives and helping make the health system work better for everyone, we have grown to serve more people in more ways than ever, including through innovative uses of advanced technologies, data analytics, and modern clinical approaches that improve quality, lower cost and advance consumer and care provider satisfaction,” Wichmann said.

Below are results from UnitedHealth’s first quarter, including an improved customer base, high performance out of its healthcare services subsidiary Optum, and strong activity on Wall Street:

• Customer base grew by 2.2 million people, improving revenues by $5.3 billion.

• UnitedHealthcare Employer & Individual served 195,000 less people in commercial group plans due to employers moving retirees to group Medicare Advantage plans.

• However, UnitedHealthcare Medicare & Retirement added 375,000 seniors in the first quarter, resulting in revenue growth of $2.4 billion.

• Overall, Optum revenues increased by 11% year-over-year.

• OptumHealth revenues grew 21.7% year-over-year, to $5.8 billion

• First quarter earnings from operations rose $374 million, a 29% increase, totalling $1.7 billion.

• The pre-opening announcement boosted UnitedHealth’s stock during Tuesday trading, finishing the day up 3.6%, at 238.54

• This follows a first quarter where UnitedHealth repurchased 11.6 million shares for $2.65 billion and paid $722 million in dividends to shareholders, an increase of 21% year-over-year.