UnitedHealth Group reported stronger net income than analysts expected for the three months ending June 30 as the company benefitted from a large military health-care contract, growth driven by an acquisition in Brazil and more plans sold to elderly Americans.
The nation’s largest health insurer reported Thursday a net income of $1.44 billion for the quarter, or $1.40 per share, compared with $1.34 billion, or $1.27 per share, during the same period a year ago.
Analysts polled by Thomson Reuters were expecting, on average, $1.25 per share.
Total revenues were up to $30.4 billion for the quarter from $27.3 billion the year before, driven by year over year gains in premiums, services, products and investment income.
Revenue growth of 12 percent year over year to $30 billion is impressive and underscores the strength of UnitedHealth Group’s diversified platform, Ana Gupte, an analyst at Dowling & Partners Securities in Farmington, wrote in a research note to investors.
Membership in commercial plans grew to 30 million as of June 30, from 26.4 million a year before. Growth is largely due to the addition of 2.9 million TRICARE customers, which is government-funded health care for the military that is administered by private insurers in different regions of the country.
Membership in Medicare Advantage, Medicaid and Medicare Supplement plans grew to 10.23 million as of June 30 from 9.46 million a year earlier, not including stand-along prescription drug plans called “Medicare Part D.” Membership in Part D plans grew to 4.8 million from 4.23 million.
“UHC posted strong membership growth organically Medicaid and Medicare while commercial membership remained flat sequentially,” Gupte wrote in her note to investors Thursday. “Amongst commercial modest sequential growth in risk-based membership was offset by a decline in self-insured fee-based membership.”
UnitedHealth Group is the parent company for UnitedHealthcare and Optum.
While the company saw a drop in revenue from employer-based and individual health insurance plans, UnitedHealthcare had an increase in its municipal and state health plans, its Medicare and retirement plans, and a huge jump in international business. Revenue at UnitedHealthcare International grew to $1.6 billion from $38 million a year before.
This is the second quarter that UnitedHealthcare International has reported earnings reflecting its acquisition of Amil, the largest health care company in Brazil. Since Jan. 1, the number of health-insurance customers in the international business grew from 260,000 to 4.7 million.
UnitedHealth Group is based in Minnetonka, Minn., and employs about 4,200 people in Connecticut, including offices in Hartford and Rocky Hill.
Shares of UnitedHealth were up $4.32 – or 6.52 percent — to $70.55 at the close of markets Thursday.