UnitedHealth ( UNH) beat second-quarter earnings targets Wednesday and reaffirmed earnings targets for coming years.

The Minnetonka, Minn., health insurer made $974 million, or 70 cents a share, for the quarter ended June 30. That's up from the year-ago $770 million, or 58 cents a share, and 2 cents ahead of the Thomson Financial analyst consensus estimate.

Revenue surged 57% from a year ago to $17.92 billion, driven by the acquisition of PacifiCare and matching the Wall Street estimate.

"Earnings from operations and operating margins were significantly affected by the acquisition of PacifiCare Health Systems and the commencement of Medicare Part D," the company said, noting that operating margin rose to 9.1% in the latest quarter from 8.4% in the first quarter, though that's down from the year-ago 11%.

Earnings in the latest quarter were 73 cents a share, excluding the effect of Part D coverage, UnitedHealth said.

UnitedHealth said it expanded its reach to nearly 4 million new individuals through the first six months of 2006, with strong growth achieved across employer health benefits programs, senior and government services offerings and specialty product lines.

The company also cited strong costs control, saying the consolidated medical care ratio -- reflecting medical costs as a percentage of premium revenues -- declined 50 basis points on a sequential quarter basis, to 82%. As expected, on a year-over-year basis the consolidated medical care ratio increased due to the impact of the acquisition of PacifiCare and the commencement of Medicare Part D.

"We have a positive outlook for further earnings growth this year. Our businesses are in an excellent position to sustain growth and performance, driven by the overall value that their services, technologies and products offer to customers in the end-markets they serve," said CEO William McGuire.

"Our quarterly results should benefit substantively in the second half of 2006 from the natural seasonality embedded in a number of our businesses, including Medicare Part D. We therefore expect to see accelerating earnings per share growth in the second half of this year.

"At the same time, we continue to build a foundation for future growth in 2007 and beyond, and expect baseline earnings per share to climb another 15% in 2007 above our increased 2006 outlook of $2.91 to $2.95 per share."

Those figures are in line with the Wall Street estimates of $2.92 for 2006 and $3.38 for 2007.