Health Net\'s 2012 Earnings Solid
Although Health Net completed the last quarter of last year barely in the black and its overall revenue is flat, 2012 earnings were solid, and it is expected to make more gains during 2013.
The Woodland Hills-based insurer reported net income for the fourth quarter of 2012 of $5.1 million on revenues of $2.8 billion, compared to net income of $18 million on revenues of $2.6 billion for the fourth quarter of 2011. Some $20 million in corporate expenses and writedowns – including $7 million in legal fees – bit into the bottom line, according to company officials.
However, Health Net reported net income in calendar 2012 of $121.2 million on revenue of $11.3 billion. That's up 68% from calendar 2011, when net income was $72.1 million on revenue of $11.4 billion.
Health Net provided 2013 earnings guidance of $2 per share, up 38% from 2012's $1.46 per share.
“While the first half of 2012 presented us with challenges, our performance in the second half of 2012 demonstrated stability as we continued to prepare for 2013 and 2014,” said Jay Gellert, Health Net’s chief executive officer.
Although company officials forecast up to a 9% decline in commercial plan enrollment, they project gains in its Medicaid managed care and Medicare Advantage plans, although the total numbers are expected to decline between 1% to 2%.