Strong membership growth boosted health care company
results in the third quarter, but earnings took a hit because of charges.
The company brought in $631.2 million in revenue, up 57.6% from last year, and memberships grew 38% from the year-ago quarter. Analysts surveyed by Thomson First Call were expecting sales of $615.6 million.
However, Centene lost $1.65 a share compared with earnings of 28 cents a share last year. The latest quarter reflects the loss of a Kansas contract, which led to a charge of $87.1 million, or $1.96 a share. Excluding charges, the company earned 31 cents a share, 3 cents ahead of Wall Street's consensus estimate.
During the third quarter, Centene initiated operations in southwest Georgia and seven counties in Ohio, as well as several markets in Texas. The company also acquired managed vision business of OptiCare Health Systems.
Centene revised its profit guidance for the fourth quarter to between 38 cents and 43 cents a share, compared with analysts' estimates of 35 cents. For the year, the company says it expects earnings of $1.51 to $1.61 a share, well above analysts' estimates of 95 cents.
The company's forecast excludes potential shut-down costs for its Kansas health plan, but it includes the estimated effects of initiating operations in Texas and the Ohio contract.
"As we enter the fourth quarter, we look forward to making continued progress in our medical management and to capture future growth opportunities," said Michael F. Neidorff, Centene's chairman and CEO.