[July 17, 2018] |
|
UnitedHealth Group Reports Second Quarter Results
UnitedHealth Group (NYSE: UNH) reported second quarter results, with
continued strong, well-diversified performance across the enterprise.
"Today, UnitedHealth Group delivers increasing value to more people,
driven by strong execution, consistently high quality, deep
relationships and our distinctive combination of clinical, technology
and information capabilities. As we look ahead, we will drive our growth
on the strength of practical innovations that anticipate and respond to
increasing consumer expectations and clear social needs," said David S.
Wichmann, chief executive officer of UnitedHealth Group.
Based on first half 2018 results and the business outlook for the
balance of the year, the Company has raised its outlook for 2018 net
earnings to a range of $11.80 to $12.05 per share and adjusted net
earnings to a range of $12.50 to $12.75 per share, and now expects cash
flows from operations to approach $15.5 billion.
|
Quarterly Financial Performance
|
|
|
Three Months Ended
|
|
|
June 30,
|
|
|
June 30,
|
|
|
March 31,
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
Revenues
|
|
$56.1 billion
|
|
|
$50.1 billion
|
|
|
$55.2 billion
|
Earnings From Operations
|
|
$4.2 billion
|
|
|
$3.7 billion
|
|
|
$4.1 billion
|
Net Margin
|
|
5.2%
|
|
|
4.6%
|
|
|
5.1%
|
-
UnitedHealth Group's second quarter 2018 revenues grew $6 billion or
12.1 percent year-over-year to $56.1 billion.
-
Second quarter earnings from operations grew $473 million or 12.7
percent year-over-year to $4.2 billion. Adjusted net earnings of $3.14
per share grew 27.6 percent, with an improved net margin of 5.2
percent.
-
Cash flows from operations of $4.0 billion were 1.3x net income in
second quarter 2018, compared to $2.2 billion and 0.9x net income in
second quarter 2017.
-
The consolidated medical care ratio of 81.9 percent in the second
quarter of 2018 decreased 30 basis points year-over-year, as the
return of the health insurance tax more than offset business mix
changes and reduced levels of prior year reserve development. Medical
cost reserve development of $20 million was driven by positive
development in cost estimates for first quarter 2018 business.
-
The operating cost ratio of 15.0 percent in the second quarter of 2018
increased 40 basis points year-over-year, as business mix and
operating cost efficiencies were more than offset by the return of the
health insurance tax.
-
The second quarter 2018 income tax rate of 22 percent decreased 9.5
percentage points year-over-year, reflecting the reduced federal
statutory rate and stock-based compensation activity, partially offset
by the return of the nondeductible health insurance tax for 2018.
-
Second quarter 2018 days claims payable decreased one day sequentially
to 48 days; second quarter days sales outstanding decreased one day
sequentially to 18 days.
-
Annualized return on shareholders' equity was 24.4 percent in the
second quarter, and the debt to total capital ratio decreased 80 basis
points sequentially to 40.8 percent at June 30, 2018.
-
UnitedHealth Group repurchased 2.2 million shares for $500 million in
the second quarter, bringing year-to-date purchases to 13.8 million
shares for $3.15 billion. Dividends paid to shareholders were $866
million in the second quarter and reflected raising the annual
dividend payment rate by 20 percent to $3.60 per share in
June
2018.
UnitedHealthcare provides global health care benefits, serving
individuals and employers, and Medicare and Medicaid beneficiaries.
UnitedHealthcare is dedicated to simplifying the health care experience,
meeting consumer health and wellness needs and sustaining trusted
relationships with care providers.
|
Quarterly Financial Performance
|
|
|
Three Months Ended
|
|
|
June 30,
|
|
|
June 30,
|
|
|
March 31,
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
Revenues
|
|
$45.8 billion
|
|
|
$40.8 billion
|
|
|
$45.5 billion
|
Earnings From Operations
|
|
$2.4 billion
|
|
|
$2.2 billion
|
|
|
$2.4 billion
|
Operating Margin
|
|
5.1%
|
|
|
5.4%
|
|
|
5.3%
|
-
UnitedHealthcare grew to serve 2.2 million more consumers1
year-over-year in the second quarter of 2018, with revenues growing by
$5.1 billion or 12.4 percent to $45.8 billion. Revenue growth was
driven by an increasing number of people served, a higher revenue
membership mix, pricing increases to cover expected medical cost
trends and resumption of the health insurance tax for 2018. Second
quarter 2018 earnings from operations of $2.4 billion grew 6.6 percent.
-
UnitedHealthcare Employer & Individual
second quarter 2018 revenues of $13.7 billion increased $742
million year-over-year. UnitedHealthcare Employer & Individual
grew to serve 50,000 more people through risk-based offerings in
the quarter, while fee-based products decreased by 60,000 people.
-
UnitedHealthcare Medicare & Retirement
grew revenues by $2.1 billion or 12.6 percent year-over-year to
$18.9 billion in the second quarter of 2018. The business served
45,000 more seniors in the quarter, including 30,000 in Medicare
Advantage plans. The number of people UnitedHealthcare Medicare &
Retirement served through Medicare Advantage grew by 450,000 or
10.4 percent year-over-year.
-
In second quarter 2018, UnitedHealthcare
Community & State revenues of $10.7 billion grew $1.6
billion or 17.1 percent year-over-year, reflecting 12-month
membership growth of 330,000 people and services to an increasing
mix of individuals with higher clinical needs. Second quarter
membership grew 15,000 people sequentially.
-
UnitedHealthcare Global revenues grew
33.5 percent year-over-year to $2.5 billion, due principally to
business expansion.
Optum is a health services business serving the global health care
marketplace, including payers, care providers, employers, governments,
life sciences companies and consumers. Using market-leading information,
data analytics, technology and clinical insights, Optum helps improve
overall health system performance: optimizing care quality, reducing
health care costs and improving the consumer experience and health
system performance.
|
Quarterly Financial Performance
|
|
|
Three Months Ended
|
|
|
June 30,
|
|
|
June 30,
|
|
|
March 31,
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
Revenues
|
|
$24.7 billion
|
|
|
$22.7 billion
|
|
|
$23.6 billion
|
Earnings From Operations
|
|
$1.8 billion
|
|
|
$1.5 billion
|
|
|
$1.7 billion
|
Operating Margin
|
|
7.5%
|
|
|
6.7%
|
|
|
7.0%
|
-
In the second quarter of 2018, Optum revenues grew by $2 billion or
9.1 percent year-over-year to $24.7 billion. Optum's operating margin
of 7.5 percent expanded 80 basis points year-over-year. Second quarter
earnings from operations grew $327 million or 21.5 percent
year-over-year to $1.8 billion, with double-digit percentage earnings
growth rates for each business segment.
-
OptumHealth revenues of $5.9 billion
grew $819 million or 16 percent year-over-year, driven by growth
in care delivery and behavioral health, digital consumer
engagement and health financial services. OptumHealth served 92
million people at quarter end, having grown to serve 6 million
more people2 or 7 percent over the past year.
-
OptumInsight revenues grew 9.6
percent to $2.2 billion in second quarter 2018, leveraging its
data analytics capabilities for customers and driven by growth and
expansion in technology, business process and care provider
advisory services. OptumInsight's contract backlog of $15.4
billion grew $2 billion or 14.9 percent year-over-year.
-
OptumRx second quarter 2018 revenues
grew 7 percent year-over-year to $16.9 billion. OptumRx fulfilled
332 million adjusted scripts in second quarter 2018, growing 3.1
percent over the prior year, with favorable mix in specialty
pharmacy and home delivery services.
About UnitedHealth Group
UnitedHealth Group (NYSE: UNH) is a diversified health and well-being
company dedicated to helping people live healthier lives and helping
make the health system work better for everyone. UnitedHealth Group
offers a broad spectrum of products and services through two distinct
platforms: UnitedHealthcare, which provides health care coverage and
benefits services; and Optum, which provides information and
technology-enabled health services. For more information, visit
UnitedHealth Group at www.unitedhealthgroup.com
or follow @UnitedHealthGrp on Twitter.
Earnings Conference Call
As previously announced, UnitedHealth Group will discuss the Company's
results, strategy and future outlook on a conference call with investors
at 8:45 a.m. Eastern Time today. UnitedHealth Group will host a live
webcast of this conference call from the Investors page of the Company's
website (www.unitedhealthgroup.com).
Following the call, a webcast replay will be available on the same site
through July 31, 2018. The conference call replay can also be accessed
by dialing 1-800-374-0934. This earnings release and the Form 8-K dated
July 17, 2018 can also be accessed from the Investors page of the
Company's website.
Non-GAAP Financial Information
This news release presents non-GAAP financial information 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 the non-GAAP financial information to the most
directly comparable GAAP financial measure is provided in the
accompanying tables found at the end of this release.
Forward-Looking Statements
The statements, estimates, projections, guidance or outlook contained in
this document include "forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1995 (PSLRA). These
statements are intended to take advantage of the "safe harbor"
provisions of the PSLRA. Generally the words "believe," "expect,"
"intend," "estimate," "anticipate," "forecast," "outlook," "plan,"
"project," "should" and similar expressions identify forward-looking
statements, which generally are not historical in nature. These
statements may contain information about financial prospects, economic
conditions and trends and involve risks and uncertainties. We caution
that actual results could differ materially from those that management
expects, depending on the outcome of certain factors.
Some factors that could cause actual results to differ materially from
results discussed or implied in the forward-looking statements include:
our ability to effectively estimate, price for and manage our medical
costs, including the impact of any new coverage requirements; new laws
or regulations, or changes in existing laws or regulations, or their
enforcement or application, including increases in medical,
administrative, technology or other costs or decreases in enrollment
resulting from U.S., South American and other jurisdictions' regulations
affecting the health care industry; the outcome of the DOJ's legal
action relating to the risk adjustment submission matter; our ability to
maintain and achieve improvement in CMS star ratings and other quality
scores that impact revenue; reductions in revenue or delays to cash
flows received under Medicare, Medicaid and other government programs,
including the effects of a prolonged U.S. government shutdown or debt
ceiling constraints; changes in Medicare, including changes in payment
methodology, the CMS star ratings program or the application of risk
adjustment data validation audits; cyber-attacks or other privacy or
data security incidents; failure to comply with privacy and data
security regulations; regulatory and other risks and uncertainties of
the pharmacy benefits management industry; competitive pressures, which
could affect our ability to maintain or increase our market share;
changes in or challenges to our public sector contract awards; our
ability to execute contracts on competitive terms with physicians,
hospitals and other service providers; failure to achieve targeted
operating cost productivity improvements, including savings resulting
from technology enhancement and administrative modernization; increases
in costs and other liabilities associated with increased litigation,
government investigations, audits or reviews; failure to manage
successfully our strategic alliances or complete or receive anticipated
benefits of acquisitions and other strategic transactions; fluctuations
in foreign currency exchange rates on our reported shareholders' equity
and results of operations; downgrades in our credit ratings; the
performance of our investment portfolio; impairment of the value of our
goodwill and intangible assets if estimated future results do not
adequately support goodwill and intangible assets recorded for our
existing businesses or the businesses that we acquire; failure to
maintain effective and efficient information systems or if our
technology products do not operate as intended; and our ability to
obtain sufficient funds from our regulated subsidiaries or the debt or
capital markets to fund our obligations, to maintain our debt to total
capital ratio at targeted levels, to maintain our quarterly dividend
payment cycle or to continue repurchasing shares of our common stock.
This list of important factors is not intended to be exhaustive. We
discuss certain of these matters more fully, as well as certain risk
factors that may affect our business operations, financial condition and
results of operations, in our filings with the Securities and Exchange
Commission, including our annual reports on Form 10-K, quarterly reports
on Form 10-Q and current reports on Form 8-K. Any or all forward-looking
statements we make may turn out to be wrong, and can be affected by
inaccurate assumptions we might make or by known or unknown risks and
uncertainties. By their nature, forward-looking statements are not
guarantees of future performance or results and are subject to risks,
uncertainties and assumptions that are difficult to predict or quantify.
Actual future results may vary materially from expectations expressed or
implied in this document or any of our prior communications. You should
not place undue reliance on forward-looking statements, which speak only
as of the date they are made. We do not undertake to update or revise
any forward-looking statements, except as required by applicable
securities laws.
1 Reflects net consumer growth excluding the TRICARE military
health program, which concluded in 2017.
2 Reflects net consumer growth excluding the TRICARE military
health program, which concluded in 2017.
|
UNITEDHEALTH GROUP
|
Earnings Release Schedules and Supplementary Information
|
Quarter Ended June 30, 2018
|
|
- Condensed Consolidated Statements of Operations
|
- Condensed Consolidated Balance Sheets
|
- Condensed Consolidated Statements of Cash Flows
|
- Supplemental Financial Information - Businesses
|
- Supplemental Financial Information - Business Metrics
|
- Reconciliation of Non-GAAP Financial Measures
|
|
UNITEDHEALTH GROUP
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(in millions, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
2018
|
|
|
|
2017
|
|
Revenues
|
|
|
|
|
|
|
|
|
Premiums
|
|
$
|
44,458
|
|
|
$
|
39,585
|
|
|
$
|
88,542
|
|
|
$
|
78,523
|
|
Products
|
|
|
7,004
|
|
|
|
6,415
|
|
|
|
13,706
|
|
|
|
12,544
|
|
Services
|
|
|
4,269
|
|
|
|
3,797
|
|
|
|
8,373
|
|
|
|
7,231
|
|
Investment and other income
|
|
|
355
|
|
|
|
256
|
|
|
|
653
|
|
|
|
478
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
|
56,086
|
|
|
|
50,053
|
|
|
|
111,274
|
|
|
|
98,776
|
|
|
|
|
|
|
|
|
|
|
Operating costs
|
|
|
|
|
|
|
|
|
Medical costs
|
|
|
36,427
|
|
|
|
32,549
|
|
|
|
72,290
|
|
|
|
64,628
|
|
Operating costs
|
|
|
8,386
|
|
|
|
7,328
|
|
|
|
16,892
|
|
|
|
14,350
|
|
Cost of products sold
|
|
|
6,471
|
|
|
|
5,889
|
|
|
|
12,655
|
|
|
|
11,565
|
|
Depreciation and amortization
|
|
|
598
|
|
|
|
556
|
|
|
|
1,180
|
|
|
|
1,089
|
|
|
|
|
|
|
|
|
|
|
Total operating costs
|
|
|
51,882
|
|
|
|
46,322
|
|
|
|
103,017
|
|
|
|
91,632
|
|
|
|
|
|
|
|
|
|
|
Earnings from operations
|
|
|
4,204
|
|
|
|
3,731
|
|
|
|
8,257
|
|
|
|
7,144
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(344
|
)
|
|
|
(301
|
)
|
|
|
(673
|
)
|
|
|
(584
|
)
|
|
|
|
|
|
|
|
|
|
Earnings before income taxes
|
|
|
3,860
|
|
|
|
3,430
|
|
|
|
7,584
|
|
|
|
6,560
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes
|
|
|
(850
|
)
|
|
|
(1,080
|
)
|
|
|
(1,650
|
)
|
|
|
(2,019
|
)
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
3,010
|
|
|
|
2,350
|
|
|
|
5,934
|
|
|
|
4,541
|
|
|
|
|
|
|
|
|
|
|
Earnings attributable to noncontrolling interests
|
|
|
(88
|
)
|
|
|
(66
|
)
|
|
|
(176
|
)
|
|
|
(85
|
)
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to UnitedHealth Group common
shareholders
|
|
$
|
2,922
|
|
|
$
|
2,284
|
|
|
$
|
5,758
|
|
|
$
|
4,456
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share attributable to UnitedHealth Group
common shareholders
|
|
$
|
2.98
|
|
|
$
|
2.32
|
|
|
$
|
5.85
|
|
|
$
|
4.55
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per share attributable to UnitedHealth Group
common shareholders (a)
|
|
$
|
3.14
|
|
|
$
|
2.46
|
|
|
$
|
6.19
|
|
|
$
|
4.83
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted-average common shares outstanding
|
|
|
982
|
|
|
|
985
|
|
|
|
984
|
|
|
|
980
|
|
|
|
|
|
|
|
|
|
|
(a) See page 6 for a reconciliation of the non-GAAP measure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITEDHEALTH GROUP
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(in millions)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
|
|
|
|
2018
|
|
2017
|
Assets
|
|
|
|
|
Cash and short-term investments
|
|
$
|
21,860
|
|
$
|
15,490
|
Accounts receivable, net
|
|
|
10,874
|
|
|
9,568
|
Other current assets
|
|
|
13,900
|
|
|
12,026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
46,634
|
|
|
37,084
|
|
|
|
|
|
|
|
|
|
Long-term investments
|
|
|
31,237
|
|
|
28,341
|
Other long-term assets
|
|
|
76,740
|
|
|
73,633
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
154,611
|
|
$
|
139,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities, redeemable noncontrolling interests and equity
|
|
|
|
|
Medical costs payable
|
|
$
|
19,339
|
|
$
|
17,871
|
Commercial paper and current maturities of long-term debt
|
|
|
2,959
|
|
|
2,857
|
Other current liabilities
|
|
|
39,754
|
|
|
29,735
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
62,052
|
|
|
50,463
|
|
|
|
|
|
|
|
|
|
Long-term debt, less current maturities
|
|
|
32,096
|
|
|
28,835
|
Other long-term liabilities
|
|
|
7,841
|
|
|
7,738
|
Redeemable noncontrolling interests
|
|
|
1,839
|
|
|
2,189
|
Equity
|
|
|
50,783
|
|
|
49,833
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities, redeemable noncontrolling interests and equity
|
|
$
|
154,611
|
|
$
|
139,058
|
|
|
|
|
|
|
|
|
|
UNITEDHEALTH GROUP
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in millions)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
Operating Activities
|
|
|
|
|
Net earnings
|
|
$
|
5,934
|
|
|
$
|
4,541
|
|
Noncash items:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
1,180
|
|
|
|
1,089
|
|
|
|
Deferred income taxes and other
|
|
|
(148
|
)
|
|
|
(89
|
)
|
|
|
Share-based compensation
|
|
|
358
|
|
|
|
332
|
|
Net changes in operating assets and liabilities
|
|
|
5,052
|
|
|
|
2,754
|
|
|
|
Cash flows from operating activities
|
|
|
12,376
|
|
|
|
8,627
|
|
|
|
|
|
|
|
|
Investing Activities
|
|
|
|
|
Purchases of investments, net of sales and maturities
|
|
|
(2,968
|
)
|
|
|
(2,082
|
)
|
Purchases of property, equipment and capitalized software
|
|
|
(960
|
)
|
|
|
(925
|
)
|
Cash paid for acquisitions, net
|
|
|
(2,636
|
)
|
|
|
(704
|
)
|
Other, net
|
|
|
(134
|
)
|
|
|
55
|
|
|
|
Cash flows used for investing activities
|
|
|
(6,698
|
)
|
|
|
(3,656
|
)
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
Common share repurchases
|
|
|
(3,150
|
)
|
|
|
(1,045
|
)
|
Dividends paid
|
|
|
(1,588
|
)
|
|
|
(1,320
|
)
|
Net change in commercial paper and long-term debt
|
|
|
2,683
|
|
|
|
(2,171
|
)
|
Other, net
|
|
|
2,842
|
|
|
|
3,724
|
|
|
|
Cash flows from (used for) financing activities
|
|
|
787
|
|
|
|
(812
|
)
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
(78
|
)
|
|
|
(7
|
)
|
Increase in cash and cash equivalents
|
|
|
6,387
|
|
|
|
4,152
|
|
Cash and cash equivalents, beginning of period
|
|
|
11,981
|
|
|
|
10,430
|
|
Cash and cash equivalents, end of period
|
|
$
|
18,368
|
|
|
$
|
14,582
|
|
|
|
|
|
|
|
|
Supplemental Schedule of Noncash Investing Activities
|
|
|
|
|
Common stock issued for acquisitions
|
|
$
|
-
|
|
|
$
|
1,867
|
|
|
|
|
|
|
|
|
|
|
UNITEDHEALTH GROUP
|
SUPPLEMENTAL FINANCIAL INFORMATION - BUSINESSES
|
(in millions, except percentages)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
2018
|
|
|
|
2017
|
|
Revenues
|
|
|
|
|
|
|
|
|
UnitedHealthcare
|
|
$
|
45,846
|
|
|
$
|
40,788
|
|
|
$
|
91,305
|
|
|
$
|
80,924
|
|
Optum
|
|
|
24,726
|
|
|
|
22,671
|
|
|
|
48,327
|
|
|
|
43,908
|
|
Eliminations
|
|
|
(14,486
|
)
|
|
|
(13,406
|
)
|
|
|
(28,358
|
)
|
|
|
(26,056
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total consolidated revenues
|
|
$
|
56,086
|
|
|
$
|
50,053
|
|
|
$
|
111,274
|
|
|
$
|
98,776
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from Operations
|
|
|
|
|
|
|
|
|
UnitedHealthcare
|
|
$
|
2,357
|
|
|
$
|
2,211
|
|
|
$
|
4,757
|
|
|
$
|
4,345
|
|
Optum (a)
|
|
|
1,847
|
|
|
|
1,520
|
|
|
|
3,500
|
|
|
|
2,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total consolidated earnings from operations
|
|
$
|
4,204
|
|
|
$
|
3,731
|
|
|
$
|
8,257
|
|
|
$
|
7,144
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Margin
|
|
|
|
|
|
|
|
|
UnitedHealthcare
|
|
|
5.1
|
%
|
|
|
5.4
|
%
|
|
|
5.2
|
%
|
|
|
5.4
|
%
|
Optum
|
|
|
7.5
|
%
|
|
|
6.7
|
%
|
|
|
7.2
|
%
|
|
|
6.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated operating margin
|
|
|
7.5
|
%
|
|
|
7.5
|
%
|
|
|
7.4
|
%
|
|
|
7.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
UnitedHealthcare Employer & Individual
|
|
$
|
13,708
|
|
|
$
|
12,966
|
|
|
$
|
27,122
|
|
|
$
|
25,705
|
|
UnitedHealthcare Medicare & Retirement
|
|
|
18,859
|
|
|
|
16,747
|
|
|
|
37,784
|
|
|
|
33,299
|
|
UnitedHealthcare Community & State
|
|
|
10,746
|
|
|
|
9,178
|
|
|
|
21,417
|
|
|
|
18,127
|
|
UnitedHealthcare Global
|
|
|
2,533
|
|
|
|
1,897
|
|
|
|
4,982
|
|
|
|
3,793
|
|
|
|
|
|
|
|
|
|
|
|
|
OptumHealth
|
|
$
|
5,941
|
|
|
$
|
5,122
|
|
|
$
|
11,700
|
|
|
$
|
9,855
|
|
OptumInsight
|
|
|
2,185
|
|
|
|
1,993
|
|
|
|
4,254
|
|
|
|
3,836
|
|
OptumRx
|
|
|
16,941
|
|
|
|
15,840
|
|
|
|
33,047
|
|
|
|
30,787
|
|
Optum eliminations
|
|
|
(341
|
)
|
|
|
(284
|
)
|
|
|
(674
|
)
|
|
|
(570
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
Earnings from operations for Optum for the three and six months
ended June 30, 2018 included $570 and $1,058 for OptumHealth; $453
and $848 for OptumInsight; and $824 and $1,594 for OptumRx,
respectively. Earnings from operations for Optum for the three and
six months ended June 30, 2017 included $422 and $754 for
OptumHealth; $372 and $666 for OptumInsight; and $726 and $1,379 for
OptumRx, respectively.
|
|
|
|
UNITEDHEALTH GROUP
|
SUPPLEMENTAL FINANCIAL INFORMATION - BUSINESS METRICS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNITEDHEALTHCARE CUSTOMER PROFILE
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
June 30,
|
People Served
|
|
2018
|
|
2018
|
|
2017
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial group:
|
|
|
|
|
|
|
|
|
|
|
|
Risk-based
|
|
|
7,905
|
|
|
7,860
|
|
|
7,935
|
|
|
7,765
|
|
|
|
Fee-based
|
|
|
18,415
|
|
|
18,475
|
|
|
18,595
|
|
|
19,110
|
Total commercial group
|
|
|
26,320
|
|
|
26,335
|
|
|
26,530
|
|
|
26,875
|
Individual
|
|
|
480
|
|
|
475
|
|
|
485
|
|
|
540
|
|
|
|
Total Commercial (a)
|
|
|
26,800
|
|
|
26,810
|
|
|
27,015
|
|
|
27,415
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare Advantage
|
|
|
4,790
|
|
|
4,760
|
|
|
4,430
|
|
|
4,340
|
Medicaid
|
|
|
6,710
|
|
|
6,695
|
|
|
6,705
|
|
|
6,380
|
Medicare Supplement (Standardized)
|
|
|
4,505
|
|
|
4,490
|
|
|
4,445
|
|
|
4,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Public and Senior
|
|
|
16,005
|
|
|
15,945
|
|
|
15,580
|
|
|
15,080
|
|
|
|
Total UnitedHealthcare - Domestic Medical
|
|
|
42,805
|
|
|
42,755
|
|
|
42,595
|
|
|
42,495
|
International
|
|
|
6,020
|
|
|
6,095
|
|
|
4,080
|
|
|
4,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total UnitedHealthcare - Medical
|
|
|
48,825
|
|
|
48,850
|
|
|
46,675
|
|
|
46,610
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medicare Part D stand-alone
|
|
|
4,730
|
|
|
4,770
|
|
|
4,940
|
|
|
4,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPTUM PERFORMANCE METRICS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
June 30,
|
|
|
|
|
|
2018
|
|
2018
|
|
2017
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
OptumHealth Consumers Served (in millions) (a)
|
|
|
92
|
|
|
91
|
|
|
88
|
|
|
86
|
OptumInsight Contract Backlog (in billions)
|
|
$
|
15.4
|
|
$
|
15.2
|
|
$
|
15.0
|
|
$
|
13.4
|
OptumRx Quarterly Adjusted Scripts (in millions)
|
|
|
332
|
|
|
332
|
|
|
333
|
|
|
322
|
|
|
|
|
|
|
|
|
|
(a) Excludes TRICARE of 2.9 million at December 31, 2017 and June
30, 2017.
|
Note: UnitedHealth Group served 140 million unique individuals
across all businesses at June 30, 2018.
|
|
UNITEDHEALTH GROUP
|
|
Reconciliation of Non-GAAP Financial Measures
|
|
|
- Adjusted Net Earnings per Share
|
- Adjusted Cash Flows from Operations
|
|
|
|
Use of Non-GAAP Financial Measures
|
Adjusted net earnings per share and adjusted cash flows from
operations are non-GAAP financial measures. Non-GAAP financial
measures should be considered in addition to, but not as a
substitute for, or superior to, financial measures prepared in
accordance with GAAP.
Adjusted net earnings per share excludes from the relevant GAAP
metric, as applicable, intangible amortization and other items, if
any, that do not relate to the Company's underlying business
performance. Management believes that the use of adjusted net
earnings per share provides investors and management useful
information about the earnings impact of acquisition-related
intangible asset amortization. Management believes the exclusion
of these items provides a more useful comparison of the Company's
underlying business performance from period to period.
Management believes that the use of adjusted cash flows from
operations provides investors and management with useful
information to compare our cash flows from operations for the
current period to that of other periods, when the Company does not
receive its monthly payment from the Centers for Medicare and
Medicaid Services (CMS) in the applicable quarter. CMS generally
remits their monthly payments on the first calendar day of the
applicable month. However, if the first calendar day of the month
falls on a weekend or a holiday, CMS has typically paid the
Company on the last business day of the preceding calendar month.
Adjusted cash flows from operating activities presents operating
cash flows assuming all CMS payments were received on the first
calendar day of the applicable month.
|
|
UNITEDHEALTH GROUP
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
|
(in millions, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED NET EARNINGS PER SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
Projected Year Ended December 31,
|
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
2018
|
|
|
|
2017
|
|
|
2018
|
GAAP net earnings attributable to UnitedHealth Group common
shareholders
|
|
$
|
2,922
|
|
|
$
|
2,284
|
|
|
$
|
5,758
|
|
|
$
|
4,456
|
|
|
$11,625 to $11,875
|
Intangible amortization
|
|
|
220
|
|
|
|
220
|
|
|
|
440
|
|
|
|
439
|
|
|
~885
|
Tax effect of intangible amortization
|
|
|
(56
|
)
|
|
|
(81
|
)
|
|
|
(111
|
)
|
|
|
(163
|
)
|
|
~(220)
|
|
|
|
Adjusted net earnings attributable to UnitedHealth Group common
shareholders
|
|
$
|
3,086
|
|
|
$
|
2,423
|
|
|
$
|
6,087
|
|
|
$
|
4,732
|
|
|
~$12,300 to $12,550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted earnings per share
|
|
$
|
2.98
|
|
|
$
|
2.32
|
|
|
$
|
5.85
|
|
|
$
|
4.55
|
|
|
$11.80 to $12.05
|
Intangible amortization per share
|
|
|
0.22
|
|
|
|
0.22
|
|
|
|
0.45
|
|
|
|
0.45
|
|
|
~0.90
|
Tax effect per share of intangible amortization
|
|
|
(0.06
|
)
|
|
|
(0.08
|
)
|
|
|
(0.11
|
)
|
|
|
(0.17
|
)
|
|
~(0.20)
|
|
|
|
Adjusted diluted earnings per share
|
|
$
|
3.14
|
|
|
$
|
2.46
|
|
|
$
|
6.19
|
|
|
$
|
4.83
|
|
|
~$12.50 to $12.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED CASH FLOWS FROM OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
|
|
|
|
GAAP cash flows from operations
|
|
$
|
12,376
|
|
|
$
|
8,627
|
|
|
|
|
|
|
|
Less: July CMS premium payments received in June
|
|
|
(5,166
|
)
|
|
|
(4,454
|
)
|
|
|
|
|
|
|
|
|
|
Adjusted cash flows from operations
|
|
$
|
7,210
|
|
|
$
|
4,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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