Anthem Inc (NYSE:ANTM) Q2 2019 Earnings Conference Call - Final Transcript

Jul 24, 2019 • 08:30 am ET

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Anthem Inc (NYSE:ANTM) Q2 2019 Earnings Conference Call - Final Transcript

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Presentation
Executive
John E. Gallina

other value-added services. Consistent with last quarter, we continue to expect our local group medical cost trend in the range of 6%, plus or minus 50 basis points.

Turning to the balance sheet; our debt-to-cap ratio was 39.4% at the end of the quarter. We repurchased 1.7 million shares of common stock at a weighted average price of $272.95 totaling approximately $458 million. In total, we have repurchased 2.8 million shares of common stock year-to-date. Operating cash flow was $1.4 billion in the quarter, up $895 million from the prior year and represented at 1.1 times net income for the first six months of 2019. Days in Claims Payable was 39.1 days, an increase of 0.6 days sequentially and in line with expectations.

Looking ahead, we now expect full-year 2019 total operating revenue of approximately $102 billion with premium revenue increasing by $2 billion at the mid-point, driven by our outlook for higher than expected growth in the fully insured membership. Fully insured enrollment is now expected to be in the range of 15.6 to 15.8 million lives and self-funded enrollment is now expected to be between 25.4 million and 25.5 million lives. Altogether, full year medical membership is now expected to be in the range of 41 million to 41.3 million members.

The medical loss ratio is now expected to be in the range of 86.2% to 86.5% due to the aforementioned trends in Medicaid. The SG&A ratio is now expected to be in the range of 13.2% to 13.5% due to the greater than expected revenue growth and administrative expense efficiencies. Taken together, we now expect full-year adjusted net income to be greater than $19.30 per share.

And with that I will turn the call over to the operator for Q&A. Operator?