posted a 20% jump in first-quarter earnings and boosted full-year guidance. The health insurer also pledged to complete a $1 billion buyback in the second quarter.
The Indianapolis-based company made $732 million, or $1.09 a share, in the quarter ended March 31, up from the year-ago $611 million, or 98 cents a share. Revenue rose 26% from a year ago to $13.6 billion. Analysts surveyed by Thomson Financial had forecast a profit of $1.07 a share on revenue of $13.8 billion.
"Our first quarter results build upon the exceptional performance we achieved last year and establish a strong foundation for yet another successful year of growth going forward," said CEO Larry C. Glasscock. "WellPoint today is delivering more value to our members than ever before while helping to hold down the rising costs of health care. Our continued membership growth indicates that we are delivering the products and services consumers are looking for today."
"As of March 31, 2006, we repurchased 24.7 million shares of common stock for a total cost of $1.9 billion," said finance chief David C. Colby. "In addition, as a result of our strong earnings and cash flow, the board of directors increased our share buy-back authorization by an additional $1 billion in March 2006. We expect to complete this repurchase during the second quarter."
Medical enrollment totaled 34.2 million members at March 31, 2006, an increase of more than 5.6 million members from 28.5 million at March 31, 2005, including about 4.8 million members acquired through the WellChoice transaction.
On a comparable basis, enrollment increased by 947,000 members since March 31, 2005. The increase was driven by gains of more than 900,000 members in its national business and growth of 140,000 members in its state-sponsored operations. Growth was also realized in the individual and small group and senior businesses, while large group enrollment declined due primarily to the previously announced loss of the 315,000-member state of Georgia PPO account.
Medical enrollment grew by 302,000 members during the first quarter of 2006. An increase of more than 640,000 members in the national business was partially offset by a decrease in large group enrollment that resulted primarily from the loss of the Georgia state members and movement of other accounts to the national business classification due to group size growth. In addition to the growth in medical enrollment, the company added 1.3 million new Medicare Part D members during the quarter.
Self-funded membership represented about 50% of medical enrollment at March 31, 2006, an increase from roughly 48% of comparable medical enrollment at March 31, 2005, and about 49% at Dec. 31, 2005.
The company said it expects to make $1.14 a share for the second quarter, a penny better than the Thomson Financial target, and $4.63 a share for the year, 6 cents ahead of estimates.