01—Abstract
Summary
Summary of the 10-K filed February 14, 2020. Cited figures are marked; the original filing is the authoritative source.
UnitedHealth Group Inc. (UNH) demonstrated robust financial performance in 2019, with revenues reaching $242.2 billiona, a 7% increase year-over-year, driven by growth across both its UnitedHealthcare and Optum platforms.
Earnings from operations saw a significant 13% rise to $19.7 billionb, and diluted earnings per share increased by 18% to $14.33, reflecting effective cost management and strategic growth initiatives. The company's diversified business model, encompassing health benefits through UnitedHealthcare and health services through Optum, continues to be a key strength.
UnitedHealthcare experienced growth, particularly in its Medicare & Retirement segment, while Optum saw strong performance across OptumHealth, OptumInsight, and OptumRx, highlighting the success of its diversified service offerings and acquisitions. The company also returned substantial capital to shareholders through increased dividends and share repurchases, signaling confidence in its financial health and future prospects.
02—Key points
Key Highlights
- Consolidated revenues increased by 7% to $242.2 billion in 2019.
- Earnings from operations grew by 13% to $19.7 billion.
- Diluted earnings per share increased by 18% to $14.33.
- UnitedHealthcare revenue grew 6%, driven by Medicare & Retirement segment and commercial business growth.
- Optum revenues grew 12%, with strong contributions from all Optum segments (Health, Insight, Rx).
- The company returned $3.9 billion in dividends and repurchased $5.5 billion in common stock.
- UnitedHealthcare served approximately 575,000 additional people domestically.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2019, UnitedHealth Group Inc kept $0.06.
- Revenue$242.16B100.0%
- Cost of revenue−$28.12B11.6%
- Gross profit$214.04B88.4%
- Operating costs−$194.35B80.3%
- Operating income$19.68B8.1%
- Interest, other & tax−$5.85B2.4%
- Net income$13.84B5.7%
Where FY2019 revenue went
$242.16B- Other operating costs: $159.16B, 66% of revenue
- SG&A: $35.19B, 15% of revenue
- Net income: $13.84B, 5.7% of revenue
- Cost of revenue: $28.12B, 12% of revenue
- Interest, other & tax: $5.85B, 2.4% of revenue
Kept 5.7% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2019filed February 14, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $242.16B$226.25B | +7.0% |
| Cost of Revenue | $28.12B$27.00B | +4.1% |
| Gross Profit | $214.04B$199.25B | +7.4% |
| SG&A Expenses | $35.19B$34.07B | +3.3% |
| Operating Expenses | $222.47B$208.90B | +6.5% |
| Operating Income | $19.68B$17.34B | +13.5% |
| Interest Expense | $1.70B$1.40B | +21.7% |
| Net Income | $13.84B$11.99B | +15.5% |
| EPS (Basic) | $14.55$12.45 | +16.9% |
| EPS (Diluted) | $14.33$12.19 | +17.6% |
| Shares Outstanding (Basic) | 951.00M963.00M | −1.2% |
| Shares Outstanding (Diluted) | 966.00M983.00M | −1.7% |
05—Questions
Frequently Asked Questions
What was UnitedHealth Group's revenue growth in 2019?
UnitedHealth Group's consolidated revenues increased by 7% in 2019 to $242.2 billion, compared to $226.2 billion in 2018. This growth was primarily driven by an increase in the number of individuals served through Medicare Advantage, pricing trends, and organic and acquisition growth across the Optum business.
How did the UnitedHealthcare and Optum segments perform in 2019?
The UnitedHealthcare segment saw its revenue increase by 6% to $193.8 billion, with significant growth in the Medicare & Retirement business and commercial segments. The Optum segment's revenue grew by 12% to $113.0 billion, with OptumHealth, OptumInsight, and OptumRx all reporting increased revenues and earnings from operations, indicating strong performance across all service lines.
What is the company's strategy for managing medical costs?
UnitedHealth Group manages medical costs through various strategies including underwriting criteria, product design, negotiation of favorable provider contracts, and comprehensive care management programs. They aim to mitigate cost increases by engaging physicians and consumers with data and insights to promote high-quality, affordable care.
How does the company return capital to shareholders?
UnitedHealth Group returned capital to shareholders through dividends and share repurchases. In 2019, the company increased its quarterly cash dividend and repurchased approximately $5.5 billion of its common stock.
06—Continue