10-QPeriod: Q1 FY2021

Cigna Group Quarterly Report for Q1 Ended Mar 31, 2021

Filed May 7, 2021For Securities:CI

Summary

Cigna Group (CI) reported revenues of $40.97 billion for the first quarter of 2021, an increase of 7% compared to the same period in 2020. Shareholders' net income saw a slight decrease of 2% to $1.16 billion, or $3.30 per diluted share, primarily impacted by lower adjusted income from operations and the absence of certain tax benefits from the prior year. The company's Evernorth segment continued its strong performance, with revenues growing 13%, driven by pharmacy and health services. However, the U.S. Medical segment experienced an 18% decrease in pre-tax adjusted income from operations, largely due to unfavorable COVID-19 related impacts and the sale of the Group Disability and Life business. The company also repurchased $2.8 billion of its stock during the quarter and completed the acquisition of virtual care platform MDLIVE. Financially, Cigna demonstrated robust revenue growth, particularly within its Evernorth segment, highlighting the success of its diversified health services strategy. While overall net income saw a modest dip, this was largely attributable to temporary factors and strategic business adjustments. The company's active share repurchase program signals confidence in its financial position and commitment to returning capital to shareholders. Investors should note the ongoing impact of COVID-19 on the U.S. Medical segment, while recognizing the resilience and growth of the Evernorth business, which remains a key driver of future performance. The company also strengthened its liquidity position through new revolving credit agreements.

Financial Highlights

47 data points
Beta

Revenue

$40.97B

33.5% Gross Margin

Net Income

$1.16B

2.8% Net Margin

EPS (Diluted)

$3.30

Total Assets

$152.08B

Cash & Equivalents

$6.54B

Free Cash Flow

$1.09B

Financial Statements
Beta
Revenue$40.97B
Cost of Revenue$27.23B
Gross Profit$13.74B
SG&A Expenses$3.28B
Operating Income$1.96B
Interest Expense$325.00M
Net Income$1.16B
EPS (Basic)$3.33
EPS (Diluted)$3.30
Shares Outstanding (Diluted)351.98M

Key Highlights

  • 1Total revenues increased by 7% year-over-year to $40.97 billion.
  • 2Shareholders' net income decreased by 2% to $1.16 billion, with diluted EPS at $3.30.
  • 3Evernorth segment showed strong growth, with revenues up 13% and pre-tax adjusted income from operations up 13%.
  • 4U.S. Medical segment's pre-tax adjusted income from operations decreased by 18%, impacted by COVID-19 and business divestitures.
  • 5The company repurchased $2.8 billion of common stock in the quarter.
  • 6Cigna completed the acquisition of virtual care platform MDLIVE in April 2021.
  • 7The company strengthened its liquidity by entering into new revolving credit agreements in April 2021.

Frequently Asked Questions

Cigna reported a 7% increase in total revenues to $40.97 billion for the first quarter of 2021, compared to the same period in 2020. However, shareholders' net income slightly decreased by 2% to $1.16 billion, resulting in diluted earnings per share of $3.30. This decrease was primarily attributed to lower adjusted income from operations and the absence of certain favorable tax benefits from the prior year.

The Evernorth segment demonstrated strong growth, with revenues increasing by 13% and pre-tax adjusted income from operations up by 13%, driven by its pharmacy and health services. In contrast, the U.S. Medical segment saw its pre-tax adjusted income from operations decline by 18%, significantly impacted by unfavorable COVID-19 related costs and the sale of its Group Disability and Life business. The International Markets segment's adjusted revenues grew by 7%, though pre-tax adjusted income from operations decreased by 7%.

Cigna completed the acquisition of MDLIVE, a virtual care platform, through its Evernorth segment in April 2021 to enhance its virtual care offerings. The company also continued its share repurchase program, buying back $2.8 billion of its stock during the quarter, and strengthened its liquidity position by entering into new revolving credit agreements in April 2021.

Cigna reported that COVID-19 had net unfavorable impacts on its U.S. Medical segment in Q1 2021 compared to Q1 2020, including direct costs and lower risk-adjusted revenues, though these were partially offset by deferred care. The company anticipates continued impact from COVID-19 and related factors throughout 2021. Despite these challenges, the company's Evernorth segment's growth and strategic acquisitions like MDLIVE indicate a focus on expanding its health services capabilities and future growth drivers.