Amerigroup Reports First Quarter 2011 Results
Revenues of $1.5 Billion Increased 12.3% Year-Over-Year Net Income of $70.5 Million or $1.37 per Diluted Share
VIRGINIA BEACH, Va. (April 29, 2011) – Amerigroup Corporation (NYSE: AGP) today announced that net income for the first quarter of 2011 was $70.5 million, or $1.37 per diluted share, versus net income of $42.2 million, or $0.82 per diluted share, for the first quarter of 2010. Total revenues for the first quarter of 2011 increased 12.3% to $1.54 billion compared with $1.37 billion in the first quarter of 2010. Sequentially, total revenues increased 2.5% from the fourth quarter of 2010.
- Membership increased 36,000 members, or 1.9%, to approximately 2.0 million at the end of the first quarter compared to the fourth quarter of 2010.
- Health benefits expense was 81.8% of premium revenue for the first quarter of 2011.
- Selling, general and administrative expenses were 7.6% of total revenues for the first quarter of 2011.
- Cash flow provided by operations was $83.5 million for the three months ended March 31, 2011.
- Unregulated cash and investments were $269 million as of March 31, 2011 compared to $249 million as of December 31, 2010.
- Medical claims payable as of March 31, 2011 totaled $540 million compared to $511 million as of December 31, 2010.
- Days in claims payable was 39, consistent with the fourth quarter of 2010.
- The Company repurchased approximately 440,000 shares of its common stock during the first quarter, for $24.8 million, pursuant to its ongoing share repurchase program.
- On February 1, 2011, the Company began serving approximately 29,000 aged, blind and disabled (ABD) members in Fort Worth, Texas, on a full‐risk basis. Previously, the Company served approximately 14,000 ABD members in Dallas/Fort Worth on an administrative services only basis.
- On March 30, 2011, Standard and Poor’s raised its counterparty credit and senior debt ratings on Amerigroup to BB+ from BB.
- On April 25, 2011, the Company announced that it will open a new West Regional Service Center in Houston, Texas, in the fourth quarter of 2011 to service customers in Texas, New Mexico and Nevada. The Company will begin to occupy the facility in the summer of 2011, and it will be staffed by more than 300 associates, with capacity to grow in the future. The new service center will provide call and claims support to the Amerigroup West Region, serving more than 650,000 members in those markets.
“Medical cost trends continued to be moderate in the first quarter, and, while this can be partially attributed to favorable market conditions, it is also due to adept execution of our strategies and interventions to drive better delivery system access, performance and accountability,” said James G. Carlson, Chairman and CEO of Amerigroup. “This execution is critical as we prepare for the opportunities ahead of us and proves that real solutions for the healthcare challenges facing our nation do exist and are possible on a much bigger scale.”