Magellan Health Services Inc. in Avon today reported an 88 percent increase in first quarter profits, aided by improved performances in its radiology benefits and public-sector businesses.
The health care outsourcing company said its net income for the quarter ended March 31 was $25.5 million, or 73 cents per diluted common share, compared to a $13.6 million profit a year ago.
Net revenues for the company, which serves health plans, corporations and government agencies, jumped up to $728.1 million in the quarter compared to $619.5 million in the year ago period.
Analysts polled by Thomson Reuters forecast earnings of 65 cents on $748 million in revenue, according to the Wall Street Journal.
“Results for the first quarter of 2010 were strong across the organization, reflecting segment profit growth in behavioral and radiology management, inclusive of new business, and the results from our new Medicaid Administration business,” said René Lerer, chairman and chief executive officer of the company. “We continue to drive our diversification initiatives to offer a comprehensive suite of integrated specialty health management solutions, including broad expertise in the Medicaid segment.”
On April 1 Magellan said it also repurchased approximately 2.5 million shares for a total cost of $100 million, at an average price of $40.09.
The company ended the quarter with unrestricted cash and investments of $264.3 million, which represents an increase of $500,000 from the balance at Dec. 31, 2009.
Management also affirmed its earnings guidance for 2010 and expects to generate $95.5 million to $115 million in profits for the year.
