Ind. WellPoint Inc. Reports 2nd Quarter Profit Up on Higher Revenue

Health insurer WellPoint Inc. said this week that its second-quarter profit climbed 34 percent on increased revenue from premiums and administrative fees. The company also continues to benefit from its December acquisition of rival WellChoice Inc.

Net income for the period grew to $751.2 million, or $1.17 per share, compared with $559.4 million, or 90 cents per share, during the same period last year. This year’s results include 5 cents per share for stock option expenses and net realized investment losses of a penny per share.

Last year’s results included costs of 10 cents per share related to an agreement resolving two national multi-district lawsuits with physicians.

Revenue surged 27 percent to $14.2 billion from $11.1 billion in the prior-year period. Premiums climbed 27 percent while administrative fees increased 32 percent. The Indianapolis-based company said it has enrolled more than 1.5 million people in its Medicare Part D program, including 230,000 in the second quarter.

Overall, the health insurer had 34.2 million members compared to 28.8 million during the second quarter of last year. About 4.8 million members were acquired during the December WellChoice merger.

On average, analysts polled by Thomson Financial were looking for second-quarter earnings of $1.14 per share on sales of $14.08 billion.

The company said it sees third-quarter earnings of $1.22 per share and full-year earnings of $4.74 per share, including net realized investment losses of 2 cents per share. Analysts are expecting third-quarter earnings of $1.19 per share and full-year earnings of $4.65 per share.

WellPoint shares fell $1.82, or 2.3 percent, to $76.16 in early morning trading on the New York Stock Exchange.