Summary
Centene Corporation (CNC) reported mixed results for the second quarter of 2022. Total revenues saw a significant increase of 16% year-over-year, reaching $35.9 billion, driven by strong growth in its Medicaid and Medicare businesses, along with contributions from recent acquisitions like Magellan Health. However, the company posted a net loss of $171 million ($0.29 per diluted share), a substantial improvement from the prior year's loss of $535 million ($0.92 per diluted share). This loss was largely attributable to a significant $1.45 billion real estate impairment charge related to a portfolio optimization initiative. Despite the reported net loss, adjusted diluted EPS was $1.77, showing considerable growth from $1.25 in the prior year's quarter, indicating underlying operational strength. The company also demonstrated robust operating cash flow of $3.4 billion for the quarter. Centene continues to execute its value creation plan, focusing on SG&A savings, gross margin expansion, and strategic capital management, including significant portfolio adjustments such as the sale of PANTHERx and planned divestitures of Magellan Rx and international operations.
Financial Highlights
54 data points| Revenue | $35.94B |
| Cost of Revenue | $2.10B |
| Gross Profit | $4.56B |
| SG&A Expenses | $2.80B |
| Operating Expenses | $36.06B |
| Operating Income | -$129.00M |
| Interest Expense | $162.00M |
| Net Income | -$172.00M |
| EPS (Basic) | $-0.29 |
| EPS (Diluted) | $-0.29 |
| Shares Outstanding (Basic) | 583.64M |
| Shares Outstanding (Diluted) | 583.64M |
Key Highlights
- 1Total revenues grew 16% year-over-year to $35.9 billion, driven by strong performance in Medicaid and Medicare segments, and acquisitions.
- 2Reported a net loss of $171 million, significantly improved from a $535 million loss in Q2 2021, primarily due to a substantial real estate impairment charge.
- 3Adjusted diluted EPS reached $1.77, a notable increase from $1.25 in the prior year's quarter, signaling operational improvements.
- 4The company incurred a significant $1.45 billion impairment charge related to real estate footprint reduction, impacting reported earnings.
- 5Managed care membership increased by 1.8 million (7%) year-over-year to 26.4 million.
- 6Operating cash flow was strong at $3.4 billion for the quarter, reflecting healthy operational cash generation.
- 7Centene is actively managing its portfolio, completing the sale of PANTHERx and agreeing to sell Magellan Rx and its European businesses to focus on core operations.