UnitedHealth Group Inc. (NYSE:UNH) beat the expectations of analysts for the second quarter, reporting earnings per share of $1.40 for the second quarter—a 10 percent increase year over year. Revenue for the quarter came in at $30.4 billion. Analysts had been expecting the company to report earnings per share of $1.26 on $30.48 billion in revenue for the quarter.
UnitedHealth increased membership
The health insurer attributed its 12 percent increase in revenue year over year to higher membership during the quarter. It added 3 million more subscribers during the second quarter of the year, boosting its membership up to 45 million subscribers.
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UnitedHealth Group Inc. (NYSE:UNH)’s Optum revenues were $8.8 billion, a 21 percent increase. Operating earnings for Optum rose 68 percent year over year.
Other key results from UnitedHealth
The company noted that its consolidated medical care ratio rose 20 basis points year over year to 81.5 percent during the second quarter. UnitedHealth Group Inc. (NYSE:UNH) attributed that increase to “the higher revenue growth rate in governmental benefit program offerings.” It also saw “unprecedented levels of fee-based membership growth and services business growth and a greater mix of international business.” The result was an increase of 90 basis points year over year in the company’s operating cost ratio, which rose to 15.9 percent during the quarter.
The insurer finished the final stages of its acquisition of Amil during the quarter. It funded the public tender offer and delisted the company from the Brazilian stock exchange.
UnitedHealth tightens EPS guidance, raises dividend
The company also affirmed its 2013 guidance for full-year earnings. It expects $122 billion in revenue and cash flows from operations between $7.2 billion and $7.6 billion. It did tighten its full-year guidance for net earnings however to between $5.35 and $5.50 per share.
UnitedHealth Group Inc. (NYSE:UNH) raised its quarterly dividend 32 percent to $1.12 per share annually. It also renewed and expanded its share buyback program by authorizing the repurchase of up to 110 million shares.
During the second quarter of the year, the company bought back about 13 million shares at a value of about $197 million. It also paid $281 million to shareholders through dividends. That was a 29 percent increase year over year.