WellCare Health Plans, Inc. (NYSE:WCG) Q1 2018 Earnings Conference Call - Final Transcript
May 01, 2018 • 08:30 am ET
Good morning and welcome to the WellCare Health Plan First Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.
I would now like to turn the conference over to Angie McCabe, Vice President, Investor Relations. Please go ahead.
Angeline C. McCabe
Thank you, Andrew, and thank you all for joining us this morning for a discussion of WellCare's 2018 first quarter results.
Today, we will be making forward-looking statements, including but not limited to our 2018 financial guidance and outlook; various risks and uncertainties, such as those described in our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2017, may materially impact those statements. While these risks and uncertainties may cause our future results to differ from today's statements, we are not undertaking any obligation to update or revise any forward-looking statements.
Certain financial information that we will discuss today includes adjustments to expenses that we believe are not indicative of long-term business operations. Please refer to our news release published this morning for our basis of presentation and supplemental schedules that reconcile financial measures determined under Generally Accepted Accounting Principles, to our adjusted measures. The news release is available on our website at wellcare.com. We will identify measures that have been adjusted. Our discussion today will be led by Ken Burdick, WellCare's Chief Executive Officer; and Drew Asher, the company's Chief Financial Officer.
I will now turn the discussion over to Ken.
Kenneth A. Burdick
Thank you, Angie. Good morning, everyone, and thank you for joining our call today. This morning I'll review some of the key highlights from the first quarter of 2018 and discuss how we are positioned for the remainder of this year and beyond. Then Drew will review our financial results in more detail and provide additional commentary on our revised 2018 guidance.
We entered 2018 with strong momentum. Our first quarter results reflect continued strong execution. All three lines of our business; Medicaid, Medicare Health Plans and Medicare Prescription Drug Plans, contributed to earnings growth in the quarter. Earlier this morning, we reported adjusted earnings per diluted share of $2.47, representing a 53% increase compared with the first quarter of 2017. Adjusted net income margin for the first quarter of 2018 improved to 2.5%, a 70 basis point year-over-year increase.
Total adjusted premium revenue of $4.5 billion grew nearly 16% year-over-year, driven by a combination of organic growth and acquisitions. As a result of our performance in the quarter, we are increasing our full year 2018 adjusted earnings per diluted share guidance to a range of $10 to $10.30.
I'll now discuss our Medicaid and Medicare lines of business in more detail. Our Medicaid Health Plan segment produced strong results, primarily driven by organic growth, acquisitions and solid operational performance. We are pleased that we were recently awarded three new Medicaid contracts in our current markets of Florida, Arizona and Hawaii,