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Friday, Dec 1, 2023

Health Net’s Year of ‘Positive Momentum’

Health Net Inc. reported fourth-quarter results on Thursday that met analysts’ estimates as the company prepares for a pending merger. For the fourth quarter, the Woodland Hills health insurance company reported net income of $37.1 million (47 cents a diluted share), compared to $4.9 million (6 cents) for the same quarter a year earlier. On an adjusted basis, net income was 66 cents a share. Revenue increased 7.4 percent to $4 billion. Analysts on average expected earnings of 66 cents a share on revenue of $4.2 billion, according to Thomson Financial Network. For the full year, Health Net had net income of $186 million ($2.37) compared to $146 million ($1.80) in 2014. Revenue climbed 16 percent to $16.2 billion. Analysts on average expected earnings of $3.33 a share on revenue of $16.4 billion. The company’s expenses increased 14 percent for the year, which can be primarily attributed to expenses related to its deal with Cognizant Healthcare Services in Teaneck, N.J. as well as its upcoming merger with Centene Corp. in St. Louis, expected to close in the first half of this year. However, the company did complete its move to a single claims payment platform, which reduced the company’s claims inventory through more efficient processing. In addition, cash and investments increased to $3.2 billion for the year compared with $2.7 billion just a year prior. “We are pleased that 2015’s positive momentum continued in the fourth quarter,” Jay Gellert, Health Net’s chief executive, said in a statement. “It should be noted that we achieved these results without the anticipated incremental benefit of the Cognizant transaction expected in the second half of 2015.” Health Net shares closed up 21 cents, or less than a percent, to $62.23 on the Nasdaq.

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