BLOOMFIELD, Conn., Feb. 2, 2024
/PRNewswire/ --
- Total revenues for 2023 were $195.3
billion
- Shareholders' net income for 2023 was $5.2 billion, or $17.39 per share
- Adjusted income from operations1 for 2023
was $7.4 billion, or $25.09 per share
- 2024 adjusted income from operations1,2 is
projected to be at least $8.025
billion, or at least $28.25 per share2
- Board of Directors declared a 14% increase in the quarterly
dividend to $1.40 per share
Global health company The Cigna Group (NYSE: CI) today
reported strong 2023 results reflecting revenue and earnings growth
across its diversified portfolio of businesses.
"2023 was another very strong year for our company with
consistent execution and sustained growth," said David M. Cordani, chairman and CEO of The Cigna
Group. "We will accelerate our momentum in 2024 as we lead in
improving value, affordability and clinical outcomes, as well as
with expanding access and choice."
Shareholders' net income for fourth quarter 2023 was
$1.0 billion, or $3.49 per share, including a net after-tax loss
of $552 million, or $1.88 per share, primarily associated with the
loss on sale of businesses, a deferred tax benefit, as well as a
charge for the organizational efficiency plan, compared with
$1.2 billion, or $3.91 per share, for fourth quarter
20223.
The Cigna Group's adjusted income from operations1
for fourth quarter 2023 was $2.0
billion, or $6.79 per share,
compared with $1.5 billion, or
$5.02 per share, for fourth quarter
20223, reflecting strong contributions from both
Evernorth Health Services and Cigna Healthcare.
Shareholders' net income for 2023 was $5.2 billion, or $17.39 per share, compared with $6.7 billion, or $21.41 per share, for 20223. The Cigna
Group's adjusted income from operations1 for 2023 was
$7.4 billion, or $25.09 per share, compared with $7.3 billion, or $23.36 per share, for 20223.
A reconciliation of shareholders' net income to adjusted income
from operations1 is provided on the following page and
on Exhibit 1 of this earnings release.
CONSOLIDATED HIGHLIGHTS
The following table includes highlights of results
and reconciliations of total revenues to adjusted
revenues4 and shareholders' net income to adjusted
income from operations1:
Consolidated
Financial Results (dollars in millions):
|
|
|
|
Three Months
Ended
|
Year
Ended
|
|
December
31,
|
December
31,
|
|
2023
|
20223
|
2023
|
20223
|
|
|
|
|
|
Total
Revenues
|
$
51,114
|
$
45,753
|
$
195,265
|
$
180,518
|
Net Realized Investment
Losses (Gains) from Equity Method
Investments4
|
35
|
(8)
|
57
|
126
|
Adjusted
Revenues4
|
$
51,149
|
$
45,745
|
$
195,322
|
$
180,644
|
|
|
|
|
|
Consolidated
Earnings, net of taxes
|
|
|
|
|
Shareholders' Net
Income
|
$
1,029
|
$
1,193
|
$
5,164
|
$
6,704
|
Net Realized Investment
Losses (Gains)1
|
58
|
(17)
|
114
|
496
|
Amortization of
Acquired Intangible Assets1
|
360
|
284
|
1,413
|
1,345
|
Special
Items1
|
552
|
73
|
757
|
(1,232)
|
Adjusted Income from
Operations1
|
$
1,999
|
$
1,533
|
$
7,448
|
$
7,313
|
|
|
|
|
|
Shareholders' Net
Income, per share
|
$
3.49
|
$
3.91
|
$
17.39
|
$
21.41
|
Adjusted Income from
Operations1, per share
|
$
6.79
|
$
5.02
|
$
25.09
|
$
23.36
|
- Total revenues for fourth quarter 2023 increased 12% from
fourth quarter 2022, reflecting strong growth across Evernorth
Health Services and Cigna Healthcare.
- Shareholders' net income for fourth quarter 2023 was
$1.0 billion, or $3.49 per share, including a net after-tax loss
of $552 million, or $1.88 per share, primarily associated with the
loss on sale of businesses, a deferred tax benefit, as well as a
charge for the organizational efficiency plan, compared with
$1.2 billion, or $3.91 per share, for fourth quarter
20223.
- Adjusted income from operations1 for fourth quarter
2023 increased 30% from fourth quarter 20223, reflecting
strong contributions from Evernorth Health Services and Cigna
Healthcare.
- The SG&A expense ratio5 was 7.9% for fourth
quarter 2023, compared to 7.6% for fourth quarter 20223,
reflecting the one-time cost of an organizational efficiency plan,
partially offset by revenue growth. The adjusted SG&A expense
ratio5 was 7.4% for fourth quarter 2023, compared to
7.6% for fourth quarter 20223.
- The debt-to-capitalization ratio was 40.1% at December 31, 2023 compared to 40.5% at
September 30, 2023 and 41.0% at
December 31, 20223.
- In 2023, the Company repurchased 7.8 million shares of common
stock for approximately $2.3
billion.
- On February 2, 2024, the
Company's Board of Directors declared a cash quarterly dividend of
$1.40 per share of Cigna common stock
to be paid on March 21, 2024 to
shareholders of record as of the close of trading on March 6, 2024. This reflects a 14% increase from
the 2023 cash quarterly dividend of $1.23 per share.
CUSTOMER RELATIONSHIPS
The following table summarizes The Cigna Group's medical
customers and overall customer relationships:
Customer Relationships (in thousands):
|
As of the Periods
Ended
|
|
December
31,
|
|
2023
|
2022
|
|
|
|
Total Pharmacy
Customers6
|
98,570
|
93,905
|
|
|
|
U.S.
Healthcare
|
18,170
|
16,206
|
International
Health
|
1,610
|
1,798
|
Total Medical
Customers6
|
19,780
|
18,004
|
|
|
|
Behavioral
Care
|
24,956
|
44,841
|
Dental
|
18,543
|
18,397
|
Medicare Part
D
|
2,550
|
2,874
|
|
|
|
Total Customer
Relationships6
|
164,399
|
178,021
|
- Total pharmacy customers6 at December 31, 2023 increased 5% from December 31, 2022 to 98.6 million due to new
sales and the continued expansion of relationships.
- Total medical customers6 at December 31, 2023 grew 10% from December 31, 2022 to 19.8 million, an increase of
1.8 million customers, primarily driven by growth in U.S.
Healthcare, including fee-based customers as well as Individual and
Family Plans and Medicare Advantage customers.
- Customer relationships6 were impacted by the
non-renewal of a supplemental behavioral coverage contract with New
York Life, which was insignificant to total revenues and adjusted
income from operations1. Excluding the impact of this
contract6, behavioral care and total customer
relationships6 at December 31,
2023 increased 1% and 4%, respectively, from December 31, 2022.
HIGHLIGHTS OF SEGMENT RESULTS
See Exhibit 1 for a reconciliation of adjusted income (loss)
from operations1 to shareholders' net income.
Evernorth Health Services
This segment offers a broad range of coordinated and point
solution health services and capabilities, as well as those from
partners across the health care system, in Pharmacy Benefits, Home
Delivery Pharmacy, Specialty Pharmacy, Distribution and Care
Delivery and Management Solutions to health plans, employers,
government organizations and health care providers.
Financial Results
(dollars in millions):
|
|
|
|
|
|
Three Months
Ended
|
Year
Ended
|
|
December
31,
|
December
31,
|
|
2023
|
2022
|
2023
|
2022
|
|
|
|
|
|
Adjusted
Revenues4
|
$
40,519
|
$
36,188
|
$
153,499
|
$
140,335
|
Adjusted Income from
Operations, Pre-Tax1
|
$
1,890
|
$
1,725
|
$
6,442
|
$
6,127
|
Adjusted Margin,
Pre-Tax7
|
4.7 %
|
4.8 %
|
4.2 %
|
4.4 %
|
- Fourth quarter and full year 2023 adjusted revenues4
increased 12% and 9%, relative to fourth quarter and full year
2022, respectively, reflecting strong organic growth in specialty
pharmacy and care solutions.
- Fourth quarter and full year 2023 adjusted income from
operations, pre-tax1, increased 10% and 5%, relative to
fourth quarter and full year 2022, respectively, reflecting
continued affordability improvements and growth in specialty,
partially offset by increased strategic investments in technology
to support the onboarding of new clients and continued advancement
of our digital capabilities and care solutions.
- Fourth quarter and full year 2023 adjusted margin,
pre-tax7, was 4.7% and 4.2%, compared to 4.8% and 4.4%,
for fourth quarter and full year 2022, respectively, reflecting
continued strategic investments in technology to support the
onboarding of new clients and expansion of existing client
relationships.
Cigna Healthcare
This segment includes the U.S. Healthcare and International
Health operating segments, which provide comprehensive medical and
coordinated solutions to clients and customers. During the fourth
quarter of 2023, the U.S. Commercial and U.S. Government operating
segments combined to form the U.S. Healthcare operating segment.
U.S. Healthcare provides commercial medical plans and specialty
benefits and solutions for insured and self-insured clients,
Medicare Advantage, Medicare Supplement and Medicare Part D plans
for seniors and individual health insurance plans. International
Health solutions include health care coverage in our international
markets, as well as health care benefits for globally mobile
individuals and employees of multinational organizations.
Financial Results
(dollars in millions):
|
|
|
|
|
|
Three Months
Ended
|
Year
Ended
|
|
December
31,
|
December
31,
|
|
2023
|
20223
|
2023
|
20223
|
|
|
|
|
|
Adjusted
Revenues4,8
|
$
13,005
|
$
11,132
|
$
51,205
|
$
45,037
|
Adjusted Income from
Operations, Pre-Tax1
|
$
969
|
$
517
|
$
4,478
|
$
4,099
|
Adjusted Margin,
Pre-Tax7
|
7.5 %
|
4.6 %
|
8.7 %
|
9.1 %
|
- Fourth quarter and full year 2023 adjusted
revenues4,8 grew 17% and 14%, over fourth quarter and
full year 2022, respectively, reflecting customer growth and
premium rate increases to cover underlying medical cost
trends.
- Fourth quarter 2023 adjusted income from operations,
pre-tax1, increased relative to fourth quarter
20223, primarily driven by a lower adjusted SG&A
expense ratio5, reflecting strong revenue growth, timing
of investments, and operating efficiency, as well as a lower
MCR5 and higher net investment income.
- Full year 2023 adjusted income from operations,
pre-tax1, increased relative to full year
20223, primarily driven by a lower MCR5 and a
lower adjusted SG&A expense ratio5.
- The Cigna Healthcare MCR5 was 82.2% and 81.3% for
fourth quarter and full year 2023 compared to 83.8% and 81.7% for
fourth quarter and full year 2022, respectively. The fourth quarter
and full year 2023 MCR5 benefited from continued strong
performance in our U.S. Healthcare business, including
affordability initiatives, effective pricing execution, and
favorable stop loss results.
- Cigna Healthcare net medical costs payable9 was
$4.86 billion at December 31, 2023, $5.09
billion at September 30, 2023,
and $3.96 billion at December 31, 2022. The year-over-year increase
was primarily driven by customer growth and business mix. The
sequential decrease was consistent with prior years, reflecting
stop loss seasonality. Favorable prior year reserve development on
a gross pre-tax basis was $279
million and $259 million for
full year 2023 and 2022, respectively.
Corporate and Other Operations
Corporate reflects interest expense, amounts not allocated to
operating segments and includes intersegment eliminations.
Additionally, this discussion includes items reported in Other
Operations, which is comprised of Corporate Owned Life Insurance
("COLI") and the Company's run-off operations.
Financial Results
(dollars in millions):
|
|
|
|
|
|
Three Months
Ended
|
Year
Ended
|
|
December
31,
|
December
31,
|
|
2023
|
20223
|
2023
|
20223
|
|
|
|
|
|
Adjusted (Loss) from
Operations, Pre-Tax1
|
$
(400)
|
$
(375)
|
$
(1,602)
|
$
(957)
|
- Fourth quarter 2023 adjusted loss from operations,
pre-tax1, was $400 million
compared to $375 million for fourth
quarter 2022, primarily reflecting the impact of higher interest
rates.
- Full year 2023 adjusted loss from operations,
pre-tax1, was $1,602
million compared to $957
million for full year 2022, primarily reflecting the absence
of income from divested businesses10.
2024 OUTLOOK2
The Cigna Group's outlook2 for full year 2024
adjusted revenues2,4 is at least $235.0 billion. The Cigna Group's
outlook2 for full year 2024 consolidated adjusted income
from operations1,2 is at least $8.025 billion, or at least $28.25 per share2. Additionally, this
outlook includes the impact of expected future share repurchases
and anticipated 2024 dividends.
(dollars in
millions, except where noted and per share amounts)
|
|
2024 Consolidated
Metrics
|
Projection for Full
Year Ending
December 31,
2024
|
|
Adjusted
Revenues2,4
|
at least
$235,000
|
|
Adjusted Income from
Operations1,2
|
at least
$8,025
|
|
Adjusted Income from
Operations, per share1,2
|
at least
$28.25
|
|
Adjusted SG&A
Expense Ratio2,5
|
~6.1%
|
|
Adjusted Effective Tax
Rate2,11
|
20.5% to
21.0%
|
|
Cash Flow from
Operations2
|
at least
$11,000
|
|
Capital
Expenditures2
|
~$1,500
|
|
Shareholder
Dividends2
|
~$1,550
|
|
Weighted Average Shares
Outstanding (millions)2
|
282 to
286
|
|
|
|
|
2024 Evernorth
Metrics
|
|
|
Adjusted Income from
Operations, Pre-Tax1,2
|
at least
$7,000
|
|
|
|
|
2024 Cigna
Healthcare Metrics
|
|
|
Adjusted Income from
Operations, Pre-Tax1,2
|
at least
$4,750
|
|
Medical Care
Ratio2,5
|
81.7% to
82.7%
|
|
Total Medical
Customers2,6
|
~19.3M
|
|
The foregoing statements represent the Company's current
estimates of The Cigna Group's 2024 consolidated and segment
adjusted income from operations1,2 and other key metrics
as of the date of this release. Actual results may differ
materially depending on a number of factors. Investors are
urged to read the Cautionary Note Regarding Forward-Looking
Statements included in this release. Management does not
assume any obligation to update these estimates.
This quarterly earnings release and the Quarterly Financial
Supplement are available on The Cigna Group's website in the
Investor Relations section
(https://investors.thecignagroup.com/overview/default.aspx).
Management will be hosting a conference call to review full year
2023 results and discuss full year 2024 outlook beginning today at
8:30 a.m. ET. A link to the
conference call is available in the Investor Relations section of
The Cigna Group's website located at
https://investors.thecignagroup.com/events-and-presentations/default.aspx.
The call-in numbers for the conference call are as follows:
Live Call
(888) 566-1889 (Domestic)
(773) 799-3989 (International)
Passcode: 2022024
Replay
(800) 839-9317 (Domestic)
(203) 369-3605 (International)
It is strongly suggested you dial in to the conference call by
8:15 a.m. ET.
About The Cigna Group
The Cigna Group (NYSE: CI) is a global health company committed
to creating a better future built on the vitality of every
individual and every community. We relentlessly challenge ourselves
to partner and innovate solutions for better health. The Cigna
Group includes products and services marketed under Evernorth
Health Services, Cigna Healthcare, or its subsidiaries. The Cigna
Group maintains sales capabilities in more than 30 countries and
jurisdictions, and has approximately 165 million customer
relationships around the world. Learn more at
thecignagroup.com.
Notes:
|
|
|
1.
|
Adjusted income
(loss) from operations is a principal financial measure of
profitability used by The Cigna Group's management because it
presents the underlying results of operations of the Company's
businesses and permits analysis of trends in underlying revenue,
expenses and shareholders' net income. Adjusted income from
operations is defined as shareholders' net income (or income before
income taxes less pre-tax income (loss) attributable to
noncontrolling interests for the segment metric) excluding net
realized investment results, amortization of acquired intangible
assets and special items. The Cigna Group's share of certain
realized investment results of its joint ventures reported in the
Cigna Healthcare segment using the equity method of accounting are
also excluded. Special items are matters that management believes
are not representative of the underlying results of operations due
to their nature or size. Adjusted income (loss) from operations is
measured on an after-tax basis for consolidated results and on a
pre-tax basis for segment results. Consolidated adjusted income
(loss) from operations is not determined in accordance with GAAP
and should not be viewed as a substitute for the most directly
comparable GAAP measure, shareholders' net income. See Exhibit 1
for a reconciliation of consolidated adjusted income from
operations to shareholders' net income.
|
|
|
2.
|
Management is not
able to provide a reconciliation of adjusted income from operations
to shareholders' net income (loss), adjusted revenues to total
revenues, adjusted SG&A expense ratio to SG&A expense
ratio, or adjusted effective tax rate to effective tax rate, on a
forward-looking basis because it is unable to predict, without
unreasonable effort, certain components thereof including (i)
future net realized investment results (from equity method
investments with respect to adjusted revenues) and (ii) future
special items. These items are inherently uncertain and depend on
various factors, many of which are beyond The Cigna Group's
control. As such, any associated estimate and its impact on
shareholders' net income and total revenues could vary
materially.
|
|
|
|
The Company's
outlook excludes the potential effects of any other business
combinations that may occur after the date of this earnings
release. The Company's outlook includes the potential effects of
expected future share repurchases and anticipated 2024
dividends.
|
|
|
|
As announced in
January 2021, The Cigna Group currently intends to pay regular
quarterly dividends, with future declarations subject to approval
by its Board of Directors and the Board's determination that the
declaration of dividends remains in the best interests of The Cigna
Group and its shareholders. The decision of whether to pay future
dividends and the amount of any such dividends will be based on the
Company's financial position, results of operations, cash flows,
capital requirements, the requirements of applicable law and any
other factors the Board of Directors may deem
relevant.
|
|
|
|
The timing and
actual number of shares repurchased will depend on a variety of
factors, including price, general business and market conditions,
and alternate uses of capital. The share repurchase program may be
effected through open market purchases in compliance with Rule
10b-18 under the Securities Exchange Act of 1934, as amended,
including through Rule 10b5-1 trading plans, or privately
negotiated transactions. The program may be suspended or
discontinued at any time.
|
|
|
3.
|
Effective January 1,
2023, The Cigna Group adopted ASU 2018-12, Targeted Improvements to
the Accounting for Long-Duration Contracts, and related amendments.
Prior year results have been restated to reflect the adoption of
the new accounting guidance.
|
|
|
4.
|
Adjusted revenues is
used by The Cigna Group's management because it permits analysis of
trends in underlying revenue. The Company defines adjusted revenues
as total revenues excluding the following adjustments: special
items and The Cigna Group's share of certain realized investment
results of its joint ventures reported in the Cigna Healthcare
segment using the equity method of accounting. Special items are
matters that management believes are not representative of the
underlying results of operations due to their nature or size. We
exclude these items from this measure because management believes
they are not indicative of past or future underlying performance of
the business. Adjusted revenues is not determined in accordance
with GAAP and should not be viewed as a substitute for the most
directly comparable GAAP measure, total revenues. See Exhibit 1 for
a reconciliation of consolidated adjusted revenues to total
revenues.
|
|
|
5
|
Operating ratios are
defined as follows:
|
|
- The Cigna Healthcare medical care
ratio ("MCR") represents medical costs as a percentage of premiums
for all Cigna Healthcare risk products provided through guaranteed
cost or experience-rated funding arrangements.
- SG&A expense ratio on a GAAP basis for
the fourth quarter 2023 represents enterprise selling, general
and administrative expenses of $4,062 million as a percentage of
total revenue of $51.1 billion at a consolidated level. SG&A
expense ratio on a GAAP basis for the fourth quarter 2022
represents enterprise selling, general and administrative expenses
of $3,484 million as a percentage of total revenue of $45.8 billion
at a consolidated level.
- SG&A expense ratio on a GAAP basis for
the full year 2023 represents enterprise selling, general and
administrative expenses of $14,822 million as a percentage of total
revenue of $195.3 billion at a consolidated level. SG&A expense
ratio on a GAAP basis for the full year 2022 represents enterprise
selling, general and administrative expenses of $13,174 million as
a percentage of total revenue of $180.5 billion at a consolidated
level.
- Adjusted SG&A expense ratio for
the fourth quarter 2023 represents enterprise selling, general and
administrative expenses of $3,785 million excluding special items
of $277 million as a percentage of adjusted revenue at a
consolidated level. Adjusted SG&A expense ratio for the fourth
quarter 2022 represents enterprise selling, general and
administrative expenses of $3,461 million excluding special items
of $23 million as a percentage of adjusted revenue at a
consolidated level.
- Adjusted SG&A expense ratio for
the full year 2023 represents enterprise selling, general and
administrative expenses of $14,324 million excluding special items
of $498 million as a percentage of adjusted revenue at a
consolidated level. Adjusted SG&A expense ratio for the full
year 2022 represents enterprise selling, general and administrative
expenses of $13,045 million excluding special items of $129 million
as a percentage of adjusted revenue at a consolidated
level.
|
6.
|
Customer
relationships are defined as follows:
|
|
- Total medical customers includes
individuals in the Cigna Healthcare segment who meet any one of the
following criteria: are covered under a medical insurance policy,
managed care arrangement, or service agreement issued by Cigna
Healthcare; have access to Cigna Healthcare's provider network for
covered services under their medical plan; or have medical claims
that are administered by Cigna Healthcare.
- During the fourth quarter of 2023, the
U.S. Commercial and U.S. Government operating segments combined to
form the U.S. Healthcare operating segment. Information presented
for year ended December 31, 2022 has been restated to conform to
the new operating segment presentation.
- International Health medical
customers excludes medical customers served by less than 100% owned
subsidiaries, as well as certain customers served by our
third-party administrator. International Health customers as of
December 31, 2023 reflect the transition of certain runoff business
to Other Operations beginning January 1, 2023.
- Effective January 1, 2023, total pharmacy
customers have been updated to reflect customer filled
prescriptions through Inside Rx. Previously these customers
had been estimated based on active customers over a period of time.
Total pharmacy customers for prior periods have been restated to
reflect this change.
- Behavioral care and total customer
relationships as of December 31, 2022 excluding the impact of the
supplemental behavioral coverage contract with New York Life were
24,696 thousand and 157,876 thousand, respectively.
|
7.
|
Adjusted margin,
pre-tax, is calculated by dividing adjusted income (loss) from
operations, pre-tax by adjusted revenues for each
segment.
|
|
|
8.
|
The Cigna Group owns
noncontrolling interests in certain operating joint ventures. As
such, the adjusted revenues for the Cigna Healthcare segment only
include the Company's share of the joint ventures' earnings
reported in Fees and Other Revenues using the equity method of
accounting under GAAP.
|
|
|
9.
|
Medical costs
payable within the Cigna Healthcare segment are presented net of
reinsurance and other recoverables. The gross medical costs payable
balance was $5.09 billion as of December 31, 2023, $5.32
billion as of September 30, 2023, and $4.18 billion as of
December 31, 2022.
|
|
|
10.
|
On July 1, 2022, the
Company completed the sale of its life, accident and supplemental
benefits businesses in six countries (Hong Kong, Indonesia, New
Zealand, South Korea, Taiwan and Thailand) to Chubb INA Holdings,
Inc. ("Chubb") for approximately $5.4 billion in cash (the "Chubb
transaction"). In December 2022, the Company divested its ownership
interest in a joint venture in Türkiye.
|
|
|
11.
|
The measure
"adjusted effective tax rate" is not determined in accordance with
GAAP and should not be viewed as a substitute for the most directly
comparable GAAP measure, "consolidated effective tax rate". We
define adjusted effective tax rate as the consolidated income tax
rate applicable to the Company's pre-tax income excluding pre-tax
income (loss) attributable to noncontrolling interests, net
realized investment results, amortization of acquired intangible
assets, and special items. The Cigna Group's share of certain
realized investment results of its joint ventures reported in the
Cigna Healthcare segment using the equity method of accounting are
also excluded. Management is not able to provide a reconciliation
to the consolidated effective tax rate on a forward-looking basis
because we are unable to predict, without unreasonable effort,
certain components thereof including (i) future net realized
investment results and (ii) future special items.
|
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This press release, and oral statements made in connection with
this release, may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on The Cigna Group's current
expectations and projections about future trends, events and
uncertainties. These statements are not historical facts.
Forward-looking statements may include, among others, statements
concerning our projected adjusted income from operations outlook
for 2024 on a consolidated, per share, and segment basis; projected
adjusted revenue outlook for 2024; projected capital expenditures
for 2024; projected total medical customer growth over year end
2023; projected medical care and adjusted SG&A expense ratios;
projected consolidated adjusted effective tax rate; projected cash
flow from operations; future dividends, including projected
shareholder dividends for 2024; projected weighted average shares
outstanding; future financial or operating performance, including
our ability to improve the health and vitality of those we serve;
future growth, business strategy and strategic or operational
initiatives; economic, regulatory or competitive environments,
particularly with respect to the pace and extent of change in these
areas and the impact of the developing inflationary and interest
rate pressures; capital deployment plans and amounts available for
future deployment; our prospects for growth in the coming years;
the impact of revised accounting rules related to accounting for
long-duration contracts; and other statements regarding The Cigna
Group's future beliefs, expectations, plans, intentions, liquidity,
cash flows, financial condition or performance. You may identify
forward-looking statements by the use of words such as "believe,"
"expect," "project," "plan," "intend," "anticipate," "estimate,"
"predict," "potential," "may," "should," "will" or other words or
expressions of similar meaning, although not all forward-looking
statements contain such terms.
Forward-looking statements are subject to risks and
uncertainties, both known and unknown, that could cause actual
results to differ materially from those expressed or implied in
forward-looking statements. Such risks and uncertainties include,
but are not limited to: our ability to achieve our strategic and
operational initiatives; our ability to adapt to changes in an
evolving and rapidly changing industry; our ability to compete
effectively, differentiate our products and services from those of
our competitors and maintain or increase market share; price
competition, inflation and other pressures that could compress our
margins or result in premiums that are insufficient to cover the
cost of services delivered to our customers; the potential for
actual claims to exceed our estimates related to expected medical
claims; our ability to develop and maintain satisfactory
relationships with physicians, hospitals, other health service
providers and with producers and consultants; our ability to
maintain relationships with one or more key pharmaceutical
manufacturers or if payments made or discounts provided decline;
changes in the pharmacy provider marketplace or pharmacy networks;
changes in drug pricing or industry pricing benchmarks; our ability
to invest in and properly maintain our information technology and
other business systems; our ability to prevent or contain effects
of potential cyberattack or other privacy or data security
incidents; risks related to our use of artificial intelligence and
machine learning; political, legal, operational, regulatory,
economic and other risks that could affect our multinational
operations, including currency exchange rates; risks related to
strategic transactions and realization of the expected benefits of
such transactions, as well as integration or separation
difficulties or underperformance relative to expectations;
dependence on success of relationships with third parties; risk of
significant disruption within our operations or among key suppliers
or third parties; potential liability in connection with managing
medical practices and operating pharmacies, onsite clinics and
other types of medical facilities; the substantial level of
government regulation over our business and the potential effects
of new laws or regulations or changes in existing laws or
regulations; uncertainties surrounding participation in
government-sponsored programs such as Medicare; the outcome of
litigation, regulatory audits and investigations; compliance with
applicable privacy, security and data laws, regulations and
standards; potential failure of our prevention, detection and
control systems; unfavorable economic and market conditions, the
risk of a recession or other economic downturn and resulting impact
on employment metrics, stock market or changes in interest rates
and risks related to a downgrade in financial strength ratings of
our insurance subsidiaries; the impact of our significant
indebtedness and the potential for further indebtedness in the
future; credit risk related to our reinsurers; as well as more
specific risks and uncertainties discussed in our most recent
report on Form 10-K and subsequent reports on Forms 10-Q and 8-K
available through the Investor Relations section of
www.thecignagroup.com. You should not place undue reliance on
forward-looking statements, which speak only as of the date they
are made, are not guarantees of future performance or results, and
are subject to risks, uncertainties and assumptions that are
difficult to predict or quantify. The Cigna Group undertakes no
obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or otherwise,
except as may be required by law.
THE CIGNA
GROUP
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Exhibit
1
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COMPARATIVE SUMMARY
OF FINANCIAL RESULTS (unaudited)
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|
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|
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Three Months
Ended
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Years
Ended
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December
31,
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December
31,
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(Dollars in
millions, except per share amounts)
|
|
2023
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|
|
2022 (1)
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2023
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2022 (1)
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REVENUES
|
|
|
|
|
|
|
|
|
|
|
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|
|
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|
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|
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|
Pharmacy
revenues
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|
$ 36,604
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|
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$ 33,135
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|
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$
137,243
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|
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$
128,566
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Premiums
|
|
11,175
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|
|
9,548
|
|
|
44,237
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|
|
39,916
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Fees and other
revenues
|
|
3,045
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|
|
2,858
|
|
|
12,619
|
|
|
10,881
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Net investment
income
|
|
290
|
|
|
212
|
|
|
1,166
|
|
|
1,155
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Total
Revenues
|
|
51,114
|
|
|
45,753
|
|
|
195,265
|
|
|
180,518
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Net realized
investment results from certain equity method
investments
|
|
35
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|
|
(8)
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|
|
57
|
|
|
126
|
Adjusted revenues
(2)
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|
$ 51,149
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$ 45,745
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$
195,322
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|
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$
180,644
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|
|
|
|
|
|
|
|
|
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Shareholders' net
income
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|
$
1,029
|
|
|
$
1,193
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|
|
$
5,164
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|
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$
6,704
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Pre-tax adjusted income
(loss) from operations by segment
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|
|
|
|
|
|
|
|
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Evernorth Health
Services
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$
1,890
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$
1,725
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|
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$
6,442
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|
|
$
6,127
|
Cigna
Healthcare
|
|
969
|
|
|
517
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|
|
4,478
|
|
|
4,099
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Corporate and Other
Operations
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(400)
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(375)
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(1,602)
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(957)
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Consolidated pre-tax
adjusted income from operations
|
|
2,459
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|
|
1,867
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|
|
9,318
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|
|
9,269
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Adjusted income tax expense
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(460)
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(334)
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(1,870)
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|
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(1,956)
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Consolidated after-tax
adjusted income from operations
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|
$
1,999
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|
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$
1,533
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|
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$
7,448
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$
7,313
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|
|
|
|
|
|
|
|
|
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Weighted average shares
(in thousands)
|
|
294,565
|
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305,413
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296,882
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|
|
313,065
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Common shares
outstanding (in thousands)
|
|
|
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292,504
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298,676
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SHAREHOLDERS' EQUITY
at December 31,
|
|
|
|
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|
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$ 46,223
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|
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$ 44,675
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SHAREHOLDERS' EQUITY
PER SHARE at December 31,
|
|
|
|
|
|
|
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$ 158.03
|
|
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$ 149.58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
December
31,
|
|
2023
|
|
2022 (1)
|
|
2023
|
|
2022 (1)
|
(Dollars in
millions, except per share amounts)
|
Pre-tax
|
After-tax
|
|
Pre-tax
|
After-tax
|
|
Pre-tax
|
After-tax
|
|
Pre-tax
|
After-tax
|
|
|
|
|
|
|
|
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SHAREHOLDERS' NET
INCOME
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' net
income
|
|
$
1,029
|
|
|
$
1,193
|
|
|
$
5,164
|
|
|
$
6,704
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Adjustments to
reconcile adjusted income from operations
|
|
|
|
|
|
|
|
|
|
|
|
Net realized
investment losses (gains) (3)
|
$ 69
|
58
|
|
$ (14)
|
(17)
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|
$ 135
|
114
|
|
$ 613
|
496
|
Amortization of
acquired intangible assets
|
451
|
360
|
|
457
|
284
|
|
1,819
|
1,413
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|
1,876
|
1,345
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Special
Items
|
|
|
|
|
|
|
|
|
|
|
|
Loss (gain) on sale of
businesses
|
1,478
|
1,410
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|
73
|
56
|
|
1,499
|
1,429
|
|
(1,662)
|
(1,332)
|
Charge for
organizational efficiency plan
|
252
|
193
|
|
—
|
—
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|
252
|
193
|
|
22
|
17
|
Charges (benefits)
associated with litigation matters
|
—
|
—
|
|
—
|
—
|
|
201
|
171
|
|
(28)
|
(20)
|
Integration and
transaction-related costs
|
25
|
20
|
|
23
|
17
|
|
45
|
35
|
|
135
|
103
|
Deferred tax
(benefits), net
|
—
|
(1,071)
|
|
—
|
—
|
|
—
|
(1,071)
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|
—
|
—
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Adjusted income from
operations (4)
|
|
$
1,999
|
|
|
$
1,533
|
|
|
$
7,448
|
|
|
$
7,313
|
|
|
|
|
|
|
|
|
|
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|
DILUTED EARNINGS PER
SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Shareholders' net
income
|
|
$
3.49
|
|
|
$
3.91
|
|
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$
17.39
|
|
|
$
21.41
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Adjustments to
reconcile to adjusted income from operations
|
|
|
|
|
|
|
|
|
|
|
|
Net realized
investment losses (gains) (3)
|
$
0.23
|
0.20
|
|
$
(0.05)
|
(0.06)
|
|
$
0.45
|
0.38
|
|
$
1.96
|
1.59
|
Amortization of
acquired intangible assets
|
1.53
|
1.22
|
|
1.50
|
0.93
|
|
6.13
|
4.77
|
|
5.99
|
4.30
|
Special
Items
|
|
|
|
|
|
|
|
|
|
|
|
Loss (gain) on sale of
businesses
|
5.02
|
4.79
|
|
0.23
|
0.18
|
|
5.05
|
4.81
|
|
(5.31)
|
(4.26)
|
Charge for
organizational efficiency plan
|
0.86
|
0.66
|
|
—
|
—
|
|
0.85
|
0.65
|
|
0.07
|
0.05
|
Charges (benefits)
associated with litigation matters
|
—
|
—
|
|
—
|
—
|
|
0.68
|
0.58
|
|
(0.09)
|
(0.06)
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Integration and
transaction-related costs
|
0.08
|
0.07
|
|
0.08
|
0.06
|
|
0.15
|
0.12
|
|
0.43
|
0.33
|
Deferred tax
(benefits), net
|
—
|
(3.64)
|
|
—
|
—
|
|
—
|
(3.61)
|
|
—
|
—
|
Adjusted income from
operations (4)
|
|
$
6.79
|
|
|
$
5.02
|
|
|
$
25.09
|
|
|
$
23.36
|
|
|
(1)
|
Effective January 1,
2023, The Cigna Group adopted ASU 2018-12, Targeted Improvements to
the Accounting for Long-Duration Contracts, and related amendments.
Prior year results have been restated to reflect the adoption of
the new accounting guidance. Please refer to the Summary of
Significant Accounting Policies footnote in The Cigna Group's Form
10-K for the period ended December 31, 2023, expected to be
filed on February 29, 2024, for additional details.
|
(2)
|
Adjusted revenues is
defined as total revenues excluding the following adjustments:
special items and The Cigna Group's share of certain realized
investment results of its joint ventures reported in the Cigna
Healthcare segment using the equity method of accounting. These
items are excluded because they are not indicative of past or
future underlying performance of our businesses.
|
(3)
|
Includes The Cigna
Group's share of certain realized investments results of its joint
ventures reported in the Cigna Healthcare segment using the equity
method of accounting.
|
(4)
|
Adjusted income (loss)
from operations is defined as shareholders' net income (or income
before income taxes less pre-tax income (loss) attributable to
noncontrolling interests for the segment metric) excluding the
following adjustments: net realized investment results,
amortization of acquired intangible assets and special items. The
Cigna Group's share of certain realized investment results of its
joint ventures reported in the Cigna Healthcare segment using the
equity method of accounting are also excluded.
|
INVESTOR RELATIONS CONTACT:
Ralph Giacobbe
860-787-7968
Ralph.Giacobbe@TheCignaGroup.com
MEDIA CONTACT:
Justine Sessions
860-810-6523
Justine.Sessions@Evernorth.com
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SOURCE The Cigna Group