Molina Healthcare sees loss on 4Q profits
Health insurer Molina Healthcare Inc. said Tuesday it expects to report a loss during the fourth quarter, citing higher costs, mainly associated to swine flu.
The company expects a loss between 10 cents and 25 cents per share during the quarter, while Analysts polled by Thomson Reuters expect a profit of 24 cents during the quarter.
The company said it made 55 cents per share during the fourth quarter a year ago.
Molina’s shares fell $1.75, or 7 percent, to $23.37 in afternoon trading.
The health insurer said a mix of higher costs because of swine flu, high utilization because of new members, and state budget shortfalls contributed to the expected loss.
Premium revenue is expected to rise 19 percent to $962 million during the quarter, topping analyst expectations for $945.6 million, but the medical care ratio rose 2.5 percent to 87.2 percent. The medical care ratio measures the percentage of each dollar in premiums health insurers spend on patient care. Higher ratios mean higher costs.
For the full year, Molina said it expects profit between $1.12 and $1.26 per share, on a 19 percent boost in revenue to $3.7 billion. Analysts expect profit of $1.63 and revenue of $3.64 billion.
The Company plans to announce complete results for the fourth quarter and full year on Feb. 11.