Magellan Health, Inc. (NASDAQ:MGLN) Q1 2017 Earnings Conference Call - Final Transcript
Apr 26, 2017 • 10:00 am ET
Welcome, and thank you for standing by for the First Quarter 2017 Earnings Call. At this time, all participants are in a listen-only mode. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may now disconnect at this time.
Now I will turn the meeting over to Joe Bogdan. Thank you, and sir, you may begin.
Good morning, and thank you for joining Magellan Health's first quarter 2017 earnings call. With me today are Magellan's Chairman and CEO, Barry Smith; and our CFO, Jon Rubin.
The press release announcing our first quarter earnings was distributed this morning. A replay of this call will be available shortly after the conclusion of the call through May 26th. The numbers to access the replay are in the earnings release. For those who listen to the rebroadcast of this presentation, we remind you that the remarks made herein are as of today, Wednesday, April 26th, 2017, and have not been updated subsequent to the initial earnings call.
(Forward-Looking Cautionary Statements)
In addition, please note that Magellan uses certain non-GAAP financial measures when describing our financial results. Specifically, we refer to segment profit, adjusted net income and adjusted EPS, which are defined in our SEC filings and in today's press release.
Segment profit is equal to net revenues less the sum of cost of care, cost of goods sold, direct service costs and other operating expenses and includes income from unconsolidated subsidiaries but excludes segment profit from noncontrolling interests held by other parties, stock compensation expense, special charges or benefits, as well as changes in the fair value of contingent consideration recorded in relation to acquisitions.
Adjusted net income and adjusted EPS reflect certain adjustments made for acquisitions completed after January 1, 2013 to exclude non-cash stock compensation expense resulting from restricted stock purchases by sellers, changes in the fair value of contingent consideration, amortization of identified acquisition intangibles, as well as impairment of identified acquisition intangibles.
Please refer to the tables included in this morning's press release, which is available on our website, for a reconciliation of these non-GAAP financial measures to the corresponding GAAP measures.
I will now turn the call over to our Chairman and CEO, Barry Smith.
Thank you, Joe. Good morning, and thank you all for joining us today. During the past several years, we have repositioned our company and laid the foundation for growth ahead. Our value proposition, integrated approach and decades of expertise working with special populations have all converged to position Magellan as a leader in providing solutions for managing complex populations and conditions across the healthcare continuum.
I'm pleased to report that we continue to see solid results in the first quarter. The reported net revenue of $1.3 billion, net income of $17.7 million and EPS of $0.74 per share. Our adjusted net income was $26.1 million or $1.09 per share, and we achieved segment profit of $69.8 million. We are reiterating the 2017 guidance provided during our year-end earnings call in February.