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Jun 30, 2020
Centene Q2 2020 Earnings Report
Centene's second quarter performance in 2020 was solid, aligning with expectations as the company benefited from lower medical utilization due to the COVID-19 pandemic and executed well in a challenging environment.
Key Takeaways
Centene Corporation reported a strong second quarter in 2020, with diluted EPS of $2.05 and adjusted diluted EPS of $2.40. The company's performance was driven by lower medical utilization due to the COVID-19 pandemic and solid execution by the team. Total revenues increased by 51% compared to the second quarter of 2019, reaching $27.7 billion.
Managed care membership reached 24.6 million, a 64% increase over the prior year.
Total revenues grew by 51% to $27.7 billion compared to Q2 2019.
The health benefits ratio (HBR) was 82.1%, compared to 86.7% in the prior year.
Operating cash flow was $3.7 billion, representing 3.1x net earnings.
Centene
Centene
Centene Revenue by Segment
Revenue by Segment
Medicaid Revenue
CapyFin.comCommercial Revenue
CapyFin.comMedicare Revenue
CapyFin.comOther Revenue
CapyFin.com Forward Guidance
Centene provided its annual guidance for 2020.
Positive Outlook
- Total revenues are expected to be between $109.0 billion and $111.4 billion.
- GAAP diluted EPS is projected to be between $3.04 and $3.18.
- Adjusted Diluted EPS is expected to be between $4.76 and $4.96.
- Diluted shares outstanding are estimated to be between 577.9 million and 580.9 million.
- The company is well-positioned to respond quickly to evolving dynamics as it executes on its growth strategy, further supported by the strength of its balance sheet and solid financial position.
Challenges Ahead
- Adjusted Diluted EPS excludes estimated amortization of acquired intangible assets of $0.98 to $1.00 per diluted share.
- Adjusted Diluted EPS excludes acquisition-related expenses of $0.67 to $0.71 per diluted share.
- Adjusted Diluted EPS excludes the gain on the sale of the Illinois health plan of approximately $0.10 per diluted share.
- Adjusted Diluted EPS excludes debt extinguishment costs of approximately $0.07 per diluted share.
- Adjusted Diluted EPS excludes non-cash asset impairment of $0.10 per diluted share.
Revenue & Expenses
Visualization of income flow from segment revenue to net income