Coventry Health Care profit falls, but revenue rises
(Reuters) - Coventry Health Care Inc CVH.N, the regional insurer being purchased by much larger competitor Aetna Inc (AET.N) for its government healthcare business, reported a lower quarterly profit on Friday, due in part to high costs in Kentucky, while revenue rose.
Third-quarter net income was $105 million, or 78 cents per share, down from $122 million, or 83 cents per share, a year earlier. Operating revenue rose to $3.46 billion from $2.98 billion.
While Coventry continues to spend more money on healthcare than it takes in from premiums in the Kentucky Medicaid program for the poor, it said it was making financial progress there and had raised premiums.
Coventry forecast 2012 revenue of $14.06 billion to $14.07 billion. Analysts had been expecting $14.16 billion, according to Thomson Reuters I/B/E/S.
The company said it expected earnings of $3.25 to $3.30 per share for the year, including 6 cents of costs from its planned sale to Aetna.
Aetna announced plans in August to buy Coventry for $5.6 billion as part of a bet to expand more into government healthcare, which is expected to grow as the Patient Protection and Affordable Care Act rolls into place.
(Reporting by Caroline Humer; Editing by Jeffrey Benkoe and Lisa Von Ahn)
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