Bloomfield-based Cigna reported a slight drop in its first-quarter profits, but still beat analysts’ estimates thanks to an increase in operating revenues. Costs related to a proposed merger with Anthem were partly responsible for the net income dip, the company said.
The health insurer said its net income for the first quarter decreased to $519 million, or $2 per share, compared to $533 million, or $2.04 per share for the prior year’s first quarter.
Consolidated operating revenues increased 6 percent to $9.9 billion in the first quarter compared to $9.3 billion in the first quarter of 2015.
The company said first quarter 2016 shareholders’ net income included a special item charge of $36 million after-tax, or 14 cents per share, for costs related to Cigna’s proposed merger with Anthem, expected to be completed in the second quarter of 2016.
The merger between the two insurers is valued at $54.2 billion. Without the extra charge, Cigna outperformed the $2.15 a share earning projected by analysts polled by Thomson Reuters, according to the Wall Street Journal.
The company also improved its 2016 outlook. For full-year 2016, Cigna now expects earnings of $8.95 to $9.35, up from its previous forecast for earnings of $8.85 to $9.25 a share.
