Summary
Elevance Health, Inc., formerly WellPoint, Inc., filed an 8-K on January 7, 2014, to announce the divestiture of its direct-to-consumer businesses, 1-800 CONTACTS and glasses.com. This strategic decision signals a shift in focus for the company, likely towards its core health insurance operations. The sale is expected to result in a significant impairment charge for the fourth quarter of 2013, impacting reported GAAP net income. Despite the impairment charge, the company provided updated earnings guidance. WellPoint now anticipates GAAP net income of at least $7.88 per share for the full year 2013. Excluding the impairment charge, the company continues to project adjusted net income of at least $8.40 per share for the same period. Investors should note that this guidance excludes any investment gains or losses beyond those recognized in the first nine months of 2013 and focuses on the core operational performance.
Key Highlights
- 1WellPoint, Inc. (now Elevance Health) announced agreements to sell 1-800 CONTACTS and glasses.com.
- 2The sale represents a strategic divestiture of non-core assets.
- 3The company expects to record an impairment charge between $0.52 and $0.57 per share in Q4 2013 due to the sale.
- 4Full-year 2013 GAAP net income is now projected to be at least $7.88 per share.
- 5Full-year 2013 adjusted net income is expected to be at least $8.40 per share, excluding the impairment charge.
- 6The guidance for 2013 excludes investment gains or losses beyond the first nine months.
- 7This filing indicates a strategic pivot by WellPoint, likely to concentrate on its health benefits business.