UnitedHealth Group Incorporated (NYSE:UNH) Q2 2018 Earnings Conference Call - Final Transcript

Jul 17, 2018 • 08:45 am ET


UnitedHealth Group Incorporated (NYSE:UNH) Q2 2018 Earnings Conference Call - Final Transcript


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Good morning. I will be your conference operator today. Welcome to the UnitedHealth Group Second Quarter 2018 Earnings Conference Call. A question-and-answer session will follow UnitedHealth Group's prepared remarks. As a reminder, this call is being recorded.

(Forward-Looking Cautionary Statements) I would now like to turn the conference over to the Chief Executive Officer of UnitedHealth Group, Mr. David Wichmann. Please go ahead.

David Wichmann

Thank you, and good morning everyone, and thanks for joining us for our second quarter report. We are encouraged by how our businesses are advancing in service to customers, consumers, physicians and across the healthcare system at large, encouraged by far from satisfied. Continuous innovation and improvement in healthcare experience are critical to fulfilling our mission, helping people live healthier lives and helping make the health system more better for everyone. Consistency in high-quality care, consumer experience and value-built trust and loyalty, these drive retention in growth and position us to deliver strong and reliable financial results in 2019, 2020 and beyond.

First half 2018 performance illustrates a strong execution on this path. Compared to last year's first half, revenues of $111.3 billion increased 12.7% or $12.5 billion. Adjusted cash flows from operations grew $7.2 billion and adjusted net earnings grew 28.2% to $6.19 per share. For the full year, our outlook for adjusted net earnings per share is increasing to a new range of $12.50 to $12.75 per share and we expect cash flows from operations for 2018 to approach $15.5 billion, which is the upper end of our previous guidance.

Importantly. our enterprise wide net promoter score is tracking to advance meaningfully again in 2018. After increasing six points in 2017, our NPS is particularly strong or strongly improving across our government program customers and consumers, within our care delivery businesses, with network physicians and their practice managers, and with customers and consumers at UnitedHealthcare Global, and the pharmacy business at OptumRx. NPS across the employer health benefits base remain solid with upside opportunities to distinguish our performance among commercial market consumers. We believe emerging innovations around the next generation of digitally enabled, highly personalized services combined with more evolved consumer-centric benefit offerings will further advance our NPS performance.

Our quality continues to be strong and rising. Approximately 80% of our Medicare Advantage seniors will be served by four-star rated plans in 2019 and we are looking to improve on that strong base in 2020. For commercial benefits, we expect more than 40 local market health plans will be rated in that top seated (ph) categories in 2018, up from just 10 two years ago. And we continue to help create a better future for healthcare through venture investments, building new businesses organically, ongoing investments and innovations throughout our enterprise, and open-source innovation through partnerships and strategic acquisitions of businesses and capabilities. We look forward to sharing some of these and other innovations and developments with you at our Annual Investor Conference.

As you know, we apply core competencies in clinical expertise, technology and data analytics