WASHINGTON (dpa-AFX) - Health insurer Humana Inc. (HUM) Wednesday reported a 18.1% drop in second-quarter 2014 net income to $344 million, from $420 million in the prior-year period. Quarterly earnings per share slipped 16.7% to $2.19, from $2.63 reported a year before, chiefly due to investments in health care exchanges and state-based contracts and higher specialty drug costs associated with a new treatment of Hepatitis C, partially offset by membership growth and a lower diluted share count. On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $2.19 per share for the quarter. Analysts' estimates typically exclude special items.
The company clocked $12.22 billion revenues in the quarter, versus the previous year's $10.32 billion, an increase of 18.4% year-on-year. Wall Street expected revenues of $11.94 billion. Driven mainly by higher medical membership in the Retail segment and higher group Medicare Advantage membership in the Employer Group division, three-month total premiums and services revenue were up 18.6 percent year-over-year.
Looking ahead, the firm confirmed its fiscal 2014 earnings per share forecast to be in the range of $7.25 - $7.75, and sees revenues of $47 billion - $49 billion. Analysts project annual earnings per share of $7.84, on revenues of $48.03 billion.
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