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CNC · CENTENE CORP

25 filings

10-K

CNC 10-K Annual Reports

CENTENE CORP - 25 annual reports

Filing record · 2016–202610-K1110-Q328-K217

2025
CENTENE CORP Annual Report, Year Ended Dec 31, 2025
Centene Corporation (CNC) reported its 2025 fiscal year results, characterized by significant revenue growth and a substantial increase in medical costs. Total revenues reached $194.8 billion, a 19% increase year-over-year, driven by membership growth in the PDP business, marketplace expansion, and Medicaid rate increases. However, the Health Benefits Ratio (HBR) rose to 91.9% from 88.3% in the prior year, largely due to lower marketplace risk adjustment revenue, increased marketplace medical costs, and higher medical costs in Medicaid, particularly in behavioral health, home health, and high-cost drugs. A notable event for 2025 was the substantial goodwill impairment of $6.7 billion, primarily impacting the Medicaid and Commercial reporting units, contributing to a GAAP diluted loss per share of $(13.53). Adjusted diluted EPS stood at $2.08. The company also experienced a decrease in overall membership by 3% to 27.6 million, largely due to Medicaid redeterminations. Despite these challenges, Centene's operating cash flow improved significantly to $5.1 billion, and the company continued to manage its debt, with $1.8 billion remaining under its stock repurchase program as of year-end.
Feb 17, 2026
2024
CENTENE CORP Annual Report, Year Ended Dec 31, 2024
Centene Corporation reported solid financial performance for the year ended December 31, 2024, with total revenues increasing by 6% to $163.1 billion and net earnings attributable to Centene rising by 22% to $3.3 billion. This growth was driven by a 4% increase in total membership to 28.6 million, largely fueled by expansion in the Health Insurance Marketplace segment. The company's strategic focus on government-sponsored healthcare programs continues to be its core, with Medicaid representing 62% of its total external revenues. Despite overall revenue growth, the Health Benefits Ratio (HBR) saw a slight increase to 88.3% from 87.7% in the prior year, primarily due to higher acuity in the Medicaid population following redeterminations and impacts from Medicare Star rating changes. However, an improved Selling, General, and Administrative (SG&A) expense ratio of 8.5% helped offset some of these pressures.
Feb 18, 2025
2023
CENTENE CORP Annual Report, Year Ended Dec 31, 2023
Centene Corporation's (CNC) 2023 10-K filing reveals a year of significant strategic repositioning, marked by substantial divestitures and a focus on profitable growth through its core government-sponsored healthcare programs. The company reported total revenues of $154.0 billion, a 7% increase year-over-year, driven primarily by strong performance in its Medicaid and Commercial segments, particularly the Health Insurance Marketplace (Ambetter Health). Despite a 2% increase in overall membership to 27.5 million, the company experienced a decline in its Medicare membership. Financially, Centene demonstrated improved profitability, with diluted EPS of $4.95, a significant increase from $2.07 in the prior year, and adjusted diluted EPS of $6.68, up over 15%. This improvement was achieved despite $529 million in impairment charges, largely related to divestitures and real estate optimization. The company also generated strong operating cash flows of $8.1 billion, highlighting operational efficiency. Key strategic moves in 2023 included the completion of several divestitures (Operose Health, Circle Health) as part of its Value Creation Plan, alongside $1.6 billion in share repurchases. Looking ahead, Centene is focused on margin expansion, leveraging its scale, and navigating evolving regulatory landscapes, particularly within the Medicare and Medicaid programs.
Feb 20, 2024
2022
CENTENE CORP Annual Report, Year Ended Dec 31, 2022
Centene Corporation reported a net earnings of $1.2 billion on total revenues of $144.5 billion for the year ended December 31, 2022. This represents a decrease in net earnings compared to the prior year, primarily due to significant impairment charges totaling $2.3 billion related to real estate optimization, business divestitures, and a loss on a government contract. The company's value creation plan is actively being executed, including significant divestitures of non-core businesses and a strategic review of its real estate footprint, which is expected to yield substantial annualized lease expense savings. Centene's membership grew by 5% year-over-year, reaching 27.1 million members, driven by increases in its Medicaid and Medicare segments. Despite the reported net loss, the company generated robust operating cash flow of $6.3 billion. Centene continues to focus on margin expansion and profitable growth, with strategic initiatives in place to streamline operations and modernize its infrastructure. Key financial highlights include a stable Health Benefits Ratio (HBR) of 87.7% and a slight increase in the SG&A expense ratio to 8.6%. The company also announced substantial stock repurchase programs, signaling a commitment to returning capital to shareholders.
Feb 21, 2023
2021
CENTENE CORP Annual Report, Year Ended Dec 31, 2021
Centene Corporation (CNC) reported a significant year of growth and strategic acquisitions in its 2021 10-K filing. Total revenues reached $126.0 billion, marking a 13% increase year-over-year, driven primarily by Medicaid membership growth and expansion in Medicare offerings. A key strategic move was the acquisition of Magellan Health for approximately $2.6 billion, aimed at expanding Centene's integrated healthcare solutions for complex populations. The company also reported strong operating cash flows of $4.2 billion, demonstrating its ability to generate cash from its core business activities. Despite the revenue growth, the company's net earnings attributable to Centene decreased by 25% to $1.3 billion, or $2.28 per diluted share, from $1.8 billion in the prior year. This decrease was largely due to a $1.25 billion legal settlement reserve related to its pharmacy benefits manager subsidiary, Envolve. Looking ahead, Centene is focused on its Value Creation Plan, designed to drive margin expansion through SG&A savings, gross margin improvements, and strategic capital management, including share repurchases and portfolio optimization.
Feb 22, 2022
2020
CENTENE CORP Annual Report, Year Ended Dec 31, 2020
Centene Corporation's (CNC) 2020 10-K filing highlights a year of significant growth and strategic acquisitions, most notably the acquisition of WellCare Health Plans, Inc. This move substantially expanded Centene's scale and market presence, particularly in the Medicare segment. The company reported total revenues of $111.1 billion, a 49% increase year-over-year, driven by strong membership growth across its government-sponsored programs, especially Medicaid, and the reinstatement of the health insurer fee. Despite facing operational adjustments due to the COVID-19 pandemic, Centene demonstrated resilience, with operating cash flows reaching $5.5 billion. The company also announced its intention to acquire Magellan Health in early 2021, further bolstering its capabilities in behavioral health, signaling a continued focus on strategic expansion and diversification. Looking ahead, Centene is navigating a dynamic healthcare landscape marked by evolving regulations and market trends. The company's financial health remains robust, supported by strong operating cash flows and a diversified business model. Key areas of focus include integrating recent acquisitions, managing medical costs effectively, and adapting to regulatory changes. The company's proactive approach to managing its business, coupled with strategic investments, positions it to continue its growth trajectory in serving government-sponsored and commercial healthcare programs.
Feb 22, 2021
2019
CENTENE CORP Annual Report, Year Ended Dec 31, 2019
Centene Corporation's 2019 10-K filing highlights a year of significant growth and strategic expansion, culminating in the transformative acquisition of WellCare Health Plans in January 2020. The company demonstrated robust top-line growth, with total revenues increasing by 24% to $74.6 billion, driven by membership gains across its Medicaid, Medicare, and Health Insurance Marketplace offerings, as well as strategic acquisitions like Fidelis Care. Centene's focus on serving government-sponsored healthcare programs and its localized, yet centralized, operational approach have proven effective in expanding its market reach and member base to 15.2 million by year-end 2019. The company's financial performance showed a 47% increase in net earnings attributable to Centene, reaching $1.3 billion, with diluted EPS rising to $3.14. Despite an increase in the health benefits ratio (HBR) to 87.3% primarily due to normalized margins in the Health Insurance Marketplace business, the SG&A expense ratio improved to 9.3%, reflecting operational efficiencies. The significant debt incurred for the WellCare acquisition indicates a strategic shift towards a larger, more integrated healthcare enterprise poised to capture a greater share of the government-sponsored healthcare market.
Feb 18, 2020
2018
CENTENE CORP Annual Report, Year Ended Dec 31, 2018
Centene Corporation's (CNC) 2018 10-K filing details a year of significant growth, primarily driven by the acquisition of Fidelis Care, which expanded its presence into New York State and significantly increased its membership and revenue. The company reported total revenues of $60.1 billion and net earnings of $900 million for the year ended December 31, 2018. Membership grew by 15% to 14.0 million. Key financial metrics show a health benefits ratio (HBR) of 85.9%, an improvement from the previous year, indicating better cost management. However, the selling, general and administrative (SG&A) expense ratio increased to 10.7%, largely due to acquisition-related costs. Centene's business is heavily reliant on government-sponsored programs like Medicaid and Medicare. The company highlights its expertise in these areas, its localized approach to member services, and its focus on quality and innovation as key competitive strengths. Significant risk factors include reductions in government funding, changes in eligibility requirements, and the ongoing regulatory landscape surrounding healthcare reform. The company also noted the successful integration of acquisitions and continued investment in technology as strategic priorities.
Feb 19, 2019
2017
CENTENE CORP Annual Report, Year Ended Dec 31, 2017
Centene Corporation, a diversified healthcare enterprise, reported strong financial performance for the year ended December 31, 2017. The company experienced significant growth in total revenues, reaching $48.4 billion, a 19% increase year-over-year, driven largely by the full-year impact of the Health Net acquisition and organic membership growth across its government-sponsored and commercial healthcare programs. Net earnings from continuing operations attributable to Centene were $828 million, a substantial increase of 48% compared to the prior year, reflecting improved operational efficiencies and strategic execution. The company's membership grew by 7% to 12.2 million, underscoring its expanding reach in serving under-insured and uninsured individuals through Medicaid, Medicare, and Health Insurance Marketplace offerings. Centene also announced a significant strategic move with an agreement to acquire Fidelis Care in New York for $3.75 billion, signaling a continued commitment to expanding its market presence. The company's robust financial performance and strategic growth initiatives position it for continued success in the healthcare sector.
Feb 20, 2018
2016
CENTENE CORP Annual Report, Year Ended Dec 31, 2016
Centene Corporation's 2016 10-K filing highlights a year of significant transformation, largely driven by the impactful acquisition of Health Net, Inc. This acquisition dramatically expanded Centene's scale and market presence, more than doubling its membership to 11.4 million and nearly doubling its total revenues to $40.6 billion. The company continues its core mission of providing services to government-sponsored healthcare programs, with a strong focus on Medicaid and Medicare beneficiaries. The financial performance reflects this growth, with revenues up 78% and net earnings from continuing operations rising 57%. While the company navigated increased selling, general, and administrative expenses due to integration costs and the expanded operations, key metrics like the Health Benefits Ratio (HBR) improved. Centene's strategy remains focused on increasing penetration in existing markets, diversifying its business lines, and addressing evolving state needs, positioning it for continued growth in the government-sponsored health insurance sector.
Feb 21, 2017
2015
CENTENE CORP Annual Report, Year Ended Dec 31, 2015
Centene Corporation's 2015 10-K filing highlights a year of significant growth, marked by a 36% increase in premium and service revenues to $21.3 billion and a 33% rise in net earnings to $356 million, primarily driven by membership expansion across government-sponsored programs like Medicaid and CHIP. The company reported a substantial 26% increase in total membership, reaching 5.1 million by year-end. A pivotal development during the year was the announcement of Centene's definitive merger agreement with Health Net, Inc., a transaction valued at approximately $5.5 billion. This strategic move aims to significantly expand Centene's scale and market reach, particularly into Medicare Advantage and federal government contracts. The company emphasizes its decentralized, local approach supported by a centralized infrastructure as a key competitive strength, enabling it to effectively serve under-insured and uninsured populations.
Feb 22, 2016
2014
CENTENE CORP Annual Report, Year Ended Dec 31, 2014
Centene Corporation's 2015 10-K filing reveals a period of significant growth and expansion, primarily driven by its focus on government-sponsored healthcare programs like Medicaid and CHIP. The company demonstrated robust top-line growth, with premium and service revenues increasing by 48.8% in 2014 to $15.7 billion, fueled by a 41% rise in membership to 4.1 million. Net earnings also saw a substantial increase, reaching $271 million in 2014. Key to this growth were strategic expansions into new states, new product offerings like Health Insurance Marketplaces, and acquisitions in complementary service areas. The company's strategy centers on increasing penetration in existing markets, diversifying its business lines, and adapting to emerging state healthcare needs, leveraging a decentralized local approach supported by a centralized infrastructure. Centene's financial health appears strong, with operating cash flow significantly increasing and a solid equity position. Investors should note the company's continued reliance on government contracts, which exposes it to regulatory and funding risks, as well as its ongoing efforts to manage medical costs effectively.
Feb 23, 2015
2013
CENTENE CORP Annual Report, Year Ended Dec 31, 2013
Centene Corporation, a diversified healthcare enterprise, reported strong growth in its 2013 fiscal year, driven by expansion in existing and new state markets and acquisitions. The company primarily serves government-sponsored healthcare programs, with Medicaid accounting for 75% of its at-risk membership. Premium and service revenues grew by 37% to $10.5 billion, with a net earnings of $165.1 million. The company's membership base expanded by 12.3% to 2.7 million members, reflecting successful market penetration and new contract wins across several states, including California, Kansas, and New Hampshire. Centene's strategy emphasizes expanding its multi-line managed care approach, diversifying its service offerings, and leveraging its centralized infrastructure for efficiency.
Feb 21, 2014
2012
CENTENE CORP Annual Report, Year Ended Dec 31, 2012
Centene Corporation, a diversified healthcare enterprise, reported significant membership growth in 2012, increasing its at-risk managed care membership by 41% to 2.56 million. This expansion was driven by new contracts and geographic expansions in states like Texas, Louisiana, and Washington. Despite a substantial revenue increase of 59% to $8.2 billion, the company reported a net loss of $11.3 million for the year, largely due to increased medical costs, particularly in its Kentucky health plan which incurred a premium deficiency reserve of $41.5 million. The company also recorded a $28 million impairment loss related to its individual health insurance business (Celtic). While growth was strong, the high health benefits ratio (91.6%) and operational challenges in specific markets present areas of concern for investors.
Feb 19, 2013
2011
CENTENE CORP Annual Report, Year Ended Dec 31, 2011
Centene Corporation (NYSE: CNC) reported a strong 2011 in its 10-K filed February 21, 2012. Total revenues rose 20.1% to $5.34 billion, premium and service revenues grew 20.9% to $5.18 billion, and net earnings attributable to Centene were $111.2 million, or $2.12 diluted EPS from continuing operations. Growth was driven by a 18.4% increase in at-risk managed care membership to 1,816,000, fueled by new contracts in Illinois, Kentucky, Mississippi, Texas, and Arizona. Medicaid Managed Care earnings from operations rose 30.6% to $153.0 million, while Specialty Services earnings fell 6.6% to $37.3 million due to start-up losses in care management software and lower individual health insurance earnings. Profitability improved on the medical cost line. The health benefits ratio fell to 85.2% from 85.5%, mainly from lower utilization and contract enhancements, while the G&A ratio edged up to 11.3% from 11.2% on business expansion costs. Operating cash flow was $261.7 million, or 2.4 times net earnings, though this was depressed by roughly $120 million of timing-related unearned revenue shifts. The company ended the year with $1.24 billion in cash and investments, stockholders' equity of $936 million, and total debt of about $352 million, with a debt-to-capital ratio of 27.3%. Key risks for investors center on state budget pressure and contract renewal cycles. Medicaid, CHIP, and ABD funding cuts could materially reduce profitability, and several state contracts expire in 2012, including Wisconsin and South Carolina. Federal health reform (the 2010 ACA) adds both Medicaid expansion opportunities beginning in 2014 and uncertainty from pending Supreme Court review, a proposed insurer excise tax, and possible state rate reductions. The company also faces concentration risk, with Texas, Georgia, and Ohio accounting for 26%, 13%, and 10% of total revenues respectively.
Feb 21, 2012
2010
CENTENE CORP Annual Report, Year Ended Dec 31, 2010
Centene Corporation (CNC) reported full-year 2010 results showing continued growth in its Medicaid-focused managed care business. Total revenues from continuing operations were $4.45 billion (up 8.4% year over year), and premium and service revenues reached $4.28 billion (up 10.5%), driven by at-risk membership growth to roughly 1.53 million (up 5.2%) and a net 2.3% premium rate increase. Earnings from continuing operations attributable to Centene were $90.9 million, or $1.80 per diluted share, down from $1.94 in 2009, as the health benefits ratio rose to 83.8% from 83.5% and the effective tax rate climbed to 39.7% from 36.2%. Net earnings attributable to Centene, including the gain on the sale of the New Jersey plan (UHP), were $94.8 million, or $1.88 per diluted share. Operating cash flow weakened to $168.9 million from $248.2 million in 2009, which management attributed to lower prepayments from states. The company strengthened its balance sheet through a 5.75 million share offering in early 2010 (net proceeds about $104.5 million), leaving stockholders' equity at $797.1 million. It also replaced its $300 million revolver with a $350 million facility in January 2011 and entered several new contracts, including Mississippi, Indiana HIP, and an Illinois program expected to start in 2011. Investors should weigh the growth against several pressures disclosed in the filing: concentration in Texas, Georgia, and Ohio (each a major share of revenue), exposure to state budget pressures and contract rebids (including the lost Southeast Wisconsin BadgerCare contract), and uncertainty from the 2010 health care reform law, which faces active legal challenges and a future industry fee. The company also disclosed a pending IRS dispute over a $34.9 million tax benefit tied to the FirstGuard stock abandonment, which management believes will be upheld.
Feb 22, 2011
2009
CENTENE CORP Annual Report, Year Ended Dec 31, 2009
Centene Corporation (NYSE: CNC) closed 2009 with revenues of $4.1 billion, up roughly 22% year over year, and net earnings from continuing operations of $86.1 million, or $1.94 per diluted share. Growth was driven primarily by membership gains: at-risk managed care membership reached approximately 1.46 million at December 31, 2009, up 38.1% from December 31, 2007. The Medicaid Managed Care segment generated most of the revenue, while the Specialty Services segment (behavioral health, Celtic individual health insurance, pharmacy benefits management, managed vision, and others) grew faster, with earnings from operations up 67% to $38.8 million. Consolidated earnings from operations rose only 5% to $138.1 million, because Medicaid Managed Care earnings fell 8% after a one-time Georgia rate increase was recognized in 2008. The health benefits ratio rose to 83.5% from 82.5%, mainly due to H1N1 flu costs, a Texas CHIP rate cut, and higher Florida costs, partly offset by lower ABD costs. The balance sheet strengthened over the year. Stockholders' equity rose to $619.4 million, and operating cash flow was $248.2 million, or about 2.9 times net earnings. Management also highlighted a January 2010 equity offering of 5.75 million shares at $19.25 that raised about $104.5 million, which was used in part to repay the $84.0 million drawn on the $300 million revolver. Key risks flagged in the filing include concentration in a few states (Texas, Georgia, and Ohio each exceeded 10% of revenue), dependence on state funding and contract renewals (many contracts expire in 2010), pending federal health care reform, and a roughly $34.9 million IRS challenge to a 2007 tax benefit tied to the FirstGuard abandonment. Other near-term items include the expected Mississippi start in 2010, the pending sale of the New Jersey plan (UHP), and a $100 million capital spend on the corporate headquarters development. For investors, the central question is whether membership and specialty growth can keep translating into earnings growth while medical cost ratios stay in check. The 2009 results show revenue growth outpacing earnings growth, so margin discipline in Medicaid is the key watch item for 2010.
Feb 22, 2010
2008
CENTENE CORP Annual Report, Year Ended Dec 31, 2008
Centene Corporation (CNC) reported substantial revenue growth in its 2008 10-K filing, driven primarily by its Medicaid Managed Care segment. The company's strategy focuses on increasing market penetration, diversifying its service offerings, and adapting to emerging state needs in government-subsidized healthcare. Key financial highlights include a revenue of $3.4 billion and net earnings of $84.2 million from continuing operations, reflecting strong operational performance and growth. The company's business is heavily reliant on government contracts, particularly Medicaid and SCHIP programs, and it operates in a highly regulated environment. Risks identified include changes in government funding and regulations, competition, and the accuracy of medical cost estimates. Centene also reported a pending sale of its New Jersey health plan assets and is actively managing its financial resources, including a $300 million credit facility.
Feb 23, 2009
2007
CENTENE CORP Annual Report, Year Ended Dec 31, 2007
Centene Corporation (NYSE: CNC) closed 2007 as a multi-line healthcare enterprise with two segments: Medicaid Managed Care, which serves about 1.15 million members across seven states (Medicaid 74%, SCHIP 20%, SSI 6% of membership), and Specialty Services (behavioral health, life and health management, long-term care, managed vision, nurse triage, pharmacy benefits management, treatment compliance). Total revenue grew 48.8% to $2.92 billion, driven by membership growth (58.7% over two years), premium rate increases (2.7% composite in 2007) and Specialty Services expansion. Net earnings rose to $73.4 million, or $1.64 diluted EPS, but this was flattered by a $32.1 million net gain from discontinued operations (FirstGuard). Earnings from continuing operations were $41.3 million, or $0.92 diluted EPS, up from $0.47 in 2006, which had been depressed by the FirstGuard write-downs. Margin trends were mixed. The Medicaid and SCHIP health benefits ratio improved to 83.2% from 84.3%, helped by premium yield and moderating pharmacy costs. The SSI HBR worsened to 92.0% as new Ohio SSI business ramped up. Operating cash flow was $202.2 million and the company ended the year with $268.6 million in cash and about $390.6 million in investments. Liquidity is tighter than the cash figures suggest: working capital was negative $(40.5) million because the company deliberately placed investments in long-term maturities, and the company issued $175 million of 7.25% senior notes due 2014 in March 2007 to refinance revolver borrowings, lifting long-term debt to $206.4 million. Investors should weigh several risks. Revenue depends heavily on state Medicaid, SCHIP and SSI funding, which federal policy changes (the Deficit Reduction Act, CMS rules on improper payments and intergovernmental transfers, and a proposed $17.4 billion cut) could pressure. Contracts are generally one to two years and can be terminated for convenience in several states. Georgia, Texas, Ohio, Indiana and Wisconsin together provided most revenue, and Georgia alone was 23%. Securities class action litigation was dismissed in June 2007, with an appeal pending, and the company guided to a Georgia premium amendment worth about $20.8 million to be recorded in Q1 2008.
Feb 25, 2008
2006
CENTENE CORP Annual Report, Year Ended Dec 31, 2006
Centene Corporation (NYSE: CNC) reported a net loss of $43.6 million, or $1.01 per diluted share, for fiscal 2006, compared with net earnings of $55.6 million, or $1.24 per diluted share, in 2005. The swing was driven by non-cash charges tied to its FirstGuard health plans: an $81.1 million goodwill impairment (about $87.1 million including other intangibles) and $13.4 million of exit costs, which together reduced diluted EPS by roughly $2.04 pre-tax. Excluding these items, the underlying business grew strongly. Total revenue rose 51% to $2.28 billion, and year-end Medicaid Managed Care membership reached 1.26 million, up 63% over two years (45% excluding Kansas and Missouri). Operating cash flow was a healthy $195.0 million. The core risk for investors is concentration and government funding exposure. Virtually all revenue comes from state Medicaid, SCHIP and SSI programs, and five states (Georgia, Indiana, Kansas, Texas and Wisconsin) each generated more than 10% of revenue. Kansas was lost when its contract expired on December 31, 2006, and the Missouri plan was sold effective February 1, 2007. Federal SCHIP authorization expires in fiscal 2007, and the Deficit Reduction Act of 2005 cuts Medicaid spending. Georgia and New Jersey face SCHIP funding shortfalls, and several state contracts expire in mid-2007. Medical cost pressure is also visible: the Medicaid and SCHIP health benefits ratio rose to 82.6% from 81.8%, and general and administrative expenses rose sharply, partly due to premium taxes that will be netted out of revenue beginning in 2007 under EITF 06-3. Balance sheet capacity has tightened somewhat. Long-term debt more than doubled to $174.6 million, stockholders' equity fell to $326.4 million from $352.0 million, and the company faces a securities class action and a related derivative suit. Management expects cash, investments and the $300 million credit facility, of which $135.4 million was available at year end, to fund operations for at least 12 months, and anticipates roughly $30 to $40 million of cash proceeds in 2007 from the FirstGuard sale and related tax benefits.
Feb 23, 2007
2005
CENTENE CORP Annual Report, Year Ended Dec 31, 2005
Centene Corporation (NYSE: CNC) reported a strong 2005, with total revenues rising 50% to $1.51 billion and net earnings up 25% to $55.6 million, or $1.24 diluted EPS (up 22%). Growth was driven mainly by Medicaid Managed Care membership, which reached 871,900 at year-end, up 78% over two years, supported by mandatory managed care enrollment in Indiana, the SummaCare asset purchase in Ohio, and the SCHIP contract in Texas. Operating earnings rose 23% to $79.2 million, but margins were pressured by a higher Medicaid and SCHIP health benefits ratio (81.7%, up from 80.4%), including a $9.5 million Aurora Health Care settlement and new-market cost trends. The company is diversifying into specialty services through the July 2005 AirLogix disease management acquisition and the January 2006 US Script PBM acquisition (approximately $40 million plus up to $10 million in earn-outs). Specialty Services remains small, at about $97.7 million of segment revenue, but management views it as a route to revenue diversification beyond Medicaid. Balance sheet strength improved, with stockholders' equity of $352 million and goodwill of $157 million, though debt rose to $93 million, mostly from the revolving credit facility, which was expanded to $200 million in September 2005. Investors should weigh the company's concentration risk. Indiana, Kansas, Texas and Wisconsin each account for 12% to 23% of revenue, and nearly all revenue depends on state Medicaid premiums that are fixed for one-year periods. Federal proposals to cut Medicaid funding by $10 billion over five years, along with possible changes to funding mechanisms, are key risks. The Georgia contract, which begins membership operations in 2006, and the Texas SCHIP expansion are the main near-term growth drivers.
Feb 24, 2006
2004
CENTENE CORP Annual Report, Year Ended Dec 31, 2004
Centene Corporation (NYSE: CNC) reported a strong 2004 with total revenues up 30.0% to $1.0 billion and net earnings up 33.2% to $44.3 million, or $1.02 per diluted share. Growth was driven by membership gains (total members up 58% to 772,700 at year-end, including the FirstGuard acquisition in Kansas and Missouri, the Ohio market entry, and the 87,500-member Texas SCHIP EPO contract) and a 4.4% composite premium rate increase. The health benefits ratio improved to 80.7% from 82.4%, which management attributes to emergency room utilization programs and preferred drug lists, while general and administrative expenses rose 44.8% as the company invested in Specialty Services and new markets. The balance sheet expanded substantially, with total assets rising to $527.9 million from $362.7 million, largely due to goodwill from FirstGuard (goodwill now $101.6 million). Debt increased to $47.5 million from $8.2 million after drawing on a new $100 million revolving credit facility to fund the acquisition. Operating cash flow was $99.4 million. Management expects existing resources to fund operations and the pending SummaCare Ohio acquisition (approximately $31 million, expected to close in Q2 2005). Key investor considerations include the company's concentration in a few state Medicaid contracts (Indiana, New Jersey, Texas and Wisconsin each exceeded 10% of revenue), contract terms that run through 2005 to 2007, and exposure to state budget pressures and federal Medicaid policy changes. The Aurora Health Care lawsuit (claimed to exceed $8 million) is disclosed but not expected to be material. Note that the filing's preliminary FirstGuard purchase accounting and the upcoming SFAS 123R stock option expensing (effective July 2005) are items to monitor.
Feb 24, 2005
2003-A
CENTENE CORP Annual Report (Amendment), Year Ended Dec 31, 2003
Centene Corp's (CNC) amended 10-K/A for fiscal 2003 shows a managed care company that grew rapidly by serving Medicaid and SCHIP populations. Total revenues rose 66.8% to $769.7 million in 2003, driven by 64.8% premium growth and membership that climbed 108% over two years to 489,600 members. Net earnings grew 29.9% to $33.3 million, and diluted EPS was $0.87 after split adjustments. The company's health benefits ratio held steady at 82.4%, with Medicaid and SCHIP improving to 81.7% from 82.2% thanks to emergency-room utilization and drug-list initiatives. The balance sheet strengthened considerably. Stockholders' equity more than doubled to $220.1 million, supported by an August 2003 follow-on offering of 6.9 million shares that netted $81.3 million. Total assets reached $362.7 million, and cash plus investments grew substantially. Long-term debt is modest at $7.6 million, consisting mainly of a mortgage on the newly purchased St. Louis headquarters. Investors should note that the company operates in only five states, depends heavily on state Medicaid and SCHIP contracts that often run one to two years, and faces a pending $9.4 million Aurora lawsuit. Per-share figures reflect a two-for-one split payable December 17, 2004, so this amendment restates earlier share data. The main investor considerations are growth durability and concentration risk. Growth depends on winning and renewing state contracts, on managing a health benefits ratio that has historically fluctuated, and on expanding into mandatory managed care states such as Ohio, which began January 1, 2004. The company's diversification into behavioral health, medication compliance, and nurse triage is still early and small relative to Medicaid premiums.
Dec 17, 2004
2003
CENTENE CORP Annual Report, Year Ended Dec 31, 2003
Centene Corporation, a multi-line managed care organization, reported significant growth in its 2003 Form 10-K filing, driven primarily by an expansion in its Medicaid and Medicaid-related programs. The company's strategy emphasizes a localized approach to healthcare delivery, focusing on the unique needs of low-income populations through government-subsidized programs like Medicaid, SSI, and SCHIP. Key growth drivers included organic membership increases across its existing health plans in Wisconsin, Texas, and Indiana, along with strategic acquisitions in New Jersey and entry into the Ohio market. The company also expanded its service offerings by acquiring businesses in behavioral health and medication compliance, diversifying its revenue streams beyond traditional managed care. Financially, Centene demonstrated robust revenue growth, with total revenues increasing by 66.8% to $769.7 million in 2003, primarily due to a 64.8% surge in premium revenue driven by membership growth. Despite increased medical costs reflecting this growth, the company maintained a stable health benefits ratio, indicating effective cost management. General and administrative expenses also rose, partly due to expansion and new state-mandated taxes, but the overall operating performance improved, with earnings from operations growing by 48.5%. The company's liquidity position strengthened, supported by successful follow-on public offerings and positive cash flow from operations, positioning it for continued expansion and investment in its infrastructure.
Feb 25, 2004
2002
CENTENE CORP Annual Report, Year Ended Dec 31, 2002
Centene Corporation's 2002 Form 10-K details a period of significant growth, driven primarily by an expanding membership base across its Medicaid and SCHIP managed care programs. The company operates in Wisconsin, Texas, Indiana, and New Jersey, emphasizing a localized approach to healthcare delivery while leveraging centralized financial and IT support. Revenue growth was substantial, fueled by both organic membership increases and strategic acquisitions, notably the acquisition of 80% of University Health Plans in New Jersey. The company highlights its expertise in navigating complex state Medicaid programs and its commitment to quality care through various member and provider initiatives. Financially, Centene demonstrated strong revenue growth and improved profitability, evidenced by increasing earnings from operations and a declining general and administrative expense ratio, indicating operational efficiencies. The company also strengthened its balance sheet through a follow-on public offering, enhancing its liquidity and financial flexibility for future growth opportunities. Key to its strategy is continued market penetration, expansion into new states, and diversification of business lines to reduce reliance on solely Medicaid reimbursements.
Feb 25, 2003