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Health Net Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 5, 2010 06:16AM

Health Net Inc. (HNT) filed Quarterly Report for the period ended 2010-09-30. Health Net Inc. has a market cap of $2.83 billion; its shares were traded at around $28.96 with a P/E ratio of 11.8 and P/S ratio of 0.2. Health Net Inc. had an annual average earning growth of 5.5% over the past 5 years.

HNT is in the portfolios of Daniel Loeb of Third Point, LLC, Richard Snow of Snow Capital Management, L.P., David Einhorn of Greenlight Capital Inc, Steven Romick of FPA Crescent Fund, Edward Owens of Vanguard Health Care Fund, First Pacific Advisors of First Pacific Advisors, LLC, Jim Simons of Renaissance Technologies LLC, Jean-Marie Eveillard of First Eagle Investment Management, LLC, Bruce Kovner of Caxton Associates, George Soros of Soros Fund Management LLC, Jeremy Grantham of GMO LLC, Steven Cohen of SAC Capital Advisors.

Highlight of Business Operations:

Our total revenues decreased 14.5 percent in the three months ended September 30, 2010 to $3.4 billion from $4.0 billion in the same period in 2009 and decreased 14.0 percent in the nine months ended September 30, 2010 to $10.2 billion from $11.9 billion in the same period in 2009. Health plan services premium revenues decreased by approximately 22.0 percent to $2.5 billion and by approximately 20.6 percent to $7.5 billion in the three and nine months ended September 30, 2010, respectively, compared with $3.2 billion and $9.5 billion in the three and nine months ended September 30, 2009, respectively. Health plan services expenses decreased from $2.7 billion and $8.2 billion in the three and nine months ended September 30, 2009, respectively, to $2.1 billion and $6.5 billion in the three and nine months ended September 30, 2010, respectively. Investment income decreased to $19.5 million and $56.0 million in the three and nine months ended September 30, 2010, respectively, compared with $27.7 million and $72.4 million in the three and nine months ended September 30, 2009, respectively. All of these decreases were primarily due to the Northeast Sale.

Our operating results for the three months ended September 30, 2010 include $8.6 million in pretax costs related to our operations strategy. Our operating results for the nine months ended September 30, 2010 include $48.0 million in pretax costs related to our operations strategy, legal and regulatory expenses, and our corporate overhead cost reduction efforts resulting from the Northeast Sale and $9.0 million in expenses to retire our short-term debt offset by a $21.6 million non-cash benefit to health plan expenses from a litigation reserve true-up.

Our operating results for the three and nine months ended September 30, 2009 included a $170.6 million pretax asset impairment charge as a result of our entrance into a Stock Purchase Agreement with United to sell our Northeast business, $22.1 million and $88.9 million, respectively, in pretax costs for our operations strategy reduced by $3.2 million and $7.6 million, respectively, of benefits from litigation reserve true-ups. These costs are excluded from our measurement of reportable segment operating performance since they are not managed within our reportable segments and are excluded from the segment results reviewed by our chief operating decision maker.

Read the The complete Report



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