By Raghav Mahobe and Leroy Leo
(Reuters) – Cigna Corp on Thursday raised its adjusted profit forecast for the third time this year and beat quarterly sales estimates on strength in its Evernorth unit that houses its pharmacy benefit management business.
The forecast follows similar moves by rivals UnitedHealth Group, Elevance Health and Centene Corp.
Quarterly sales at Cigna’s Evernorth unit rose about 6% to $35.70 billion, driven by strong growth in its specialty pharmacy services that provide drugs for conditions like rheumatoid arthritis, cancer, HIV and rare diseases.
Growth in Evernorth drove revenue growth, while its insurance business managed to keep a tight control on costs.
The insurer’s medical care ratio, a measure of medical expenses against premiums collected, improved to 80.8% from 83.5% a year ago when there was a surge in COVID cases.
Revenue from Cigna Healthcare, which houses the insurance business, rose 2%, when adjusting for the divested Medicaid business in Texas in January, due to growth in membership of its commercial insurance plans.
Total insurance customers rose 5.6% to nearly 18 million as increase in commercial insurance memberships softened the blow from a decline in government-backed plans.
Cigna now expects adjusted income from operations of at least $23.10 per share compared with a prior forecast of at least $22.90 per share. Analysts expect full-year profit of $23 per share, according to Refinitiv data.
Third-quarter sales rose 2.2% to $45.28 billion, beating estimates of $44.76 billion.
Net income attributable to shareholders surged 70.1% to $2.76 billion due to a $1.4 billion after-tax gain from the sale of its Asia Pacific and Turkey accident and health business to Chubb Ltd.
(Reporting by Raghav Mahobe and Leroy Leo in Bengaluru; Editing by Arun Koyyur)
