Summary
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.
Financial Highlights
55 data points| Revenue | $144.55B |
| Cost of Revenue | $7.03B |
| Gross Profit | $16.92B |
| SG&A Expenses | $11.59B |
| Operating Expenses | $143.23B |
| Operating Income | $1.32B |
| Interest Expense | $665.00M |
| Net Income | $1.20B |
| EPS (Basic) | $2.09 |
| EPS (Diluted) | $2.07 |
| Shares Outstanding (Basic) | 575.19M |
| Shares Outstanding (Diluted) | 582.04M |
Key Highlights
- 1Total revenues increased by 15% to $144.5 billion, driven by membership growth in Medicaid and Medicare and the acquisition of Magellan.
- 2Net earnings decreased by 11% to $1.2 billion, primarily impacted by $2.3 billion in impairment charges and divestiture-related expenses.
- 3Operating cash flow was strong at $6.3 billion, demonstrating effective cash generation.
- 4Year-end membership grew by 5% to 27.1 million, with notable increases in Medicaid and Medicare.
- 5Health Benefits Ratio (HBR) remained stable at 87.7%, indicating consistent medical cost management relative to revenue.
- 6The company is executing a Value Creation Plan, including significant divestitures (PANTHERx, Magellan Rx, Centurion, HealthSmart) and a real estate optimization initiative expected to save over $200 million annually.
- 7Centene repurchased $3.0 billion of its common stock and has $2.8 billion remaining under its authorization, indicating a focus on capital return to shareholders.