Humana, Louisville, Ky., boosted its 2003 earnings outlook to between $1.25 per share and $1.31 per share, from a previous projection of $1.23 per share to $1.28 per share, even as it reported a drop in first-quarter earnings. However, the 33% decline in net income -- to $31.2 million, or 19 cents per share -- reflected previously announced restructuring charges. The charges stemmed mainly from Humana's decision in December 2002 to cut 2,300 jobs, or 17% of its workforce, and close three customer service centers by summer. Revenue for the first quarter rose 7% to $2.9 billion. Excluding about $31 million charges, operating income was $50 million, or 31 cents per share, matching analysts' estimates. Administrative costs dropped to 15.4% of revenue from 16.1% a year earlier, the company said. But medical costs rose to 83.4% of premium revenue from 83.1%. -- by Laura B. Benko
Cost-cutting Humana boosts earnings guidance
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