Aetna, which plans to acquire managed-care giant U.S. Healthcare in the third quarter of this year, posted robust first-quarter earnings from continuing operations, chiefly its healthcare business.
For the quarter ended March 31, Hartford, Conn.-based Aetna posted a 20% jump in net income to $124 million, or $1.07 per share, from $103 million, or 91 cents per share, in the year-ago quarter. Revenues from continuing operations for the first quarter climbed about 4% to $3.3 billion.
"Our continuing businesses demonstrated earnings improvement across the board," Aetna Chairman Ronald E. Compton said in a written statement. Those include Aetna Health Plans, whose first-quarter profits climbed 4.6% to $79.9 million from $76.4 million a year ago. Revenues for the quarter rose about 5% to $2 billion.
Aetna said enrollment growth in the group insurance business drove the increase in first-quarter operating earnings.
On April 2, Aetna completed the sale of its property-casualty operations to Travelers Insurance Co. for about $4.1 billion in cash. Aetna is paying $8.9 billion in cash and stock to acquire Blue Bell, Pa.-based U.S. Healthcare (April 8, p. 2).
The boards of each company have approved the deal, which must receive shareholder and regulatory approval.