On Feb. 13, WellCare Health Plans (NYSE:WCG) released earnings for the fourth quarter ended Dec. 31.

  • Revenue grew 129% with the addition of prescription drug plan products and the launch of a Medicaid health plan in Georgia.
  • Despite a big increase in medical benefits and administrative expenses, margins improved because of higher sales.
  • Free cash flow increased significantly due to the increase in net profit and favorable changes in working capital.
  • WellCare has begun private fee-for-service plans in more than 739 counties in 39 states and Washington, D.C. and now has about 18,000 members.
  • For the first quarter, the company is expecting revenues of $1.2 billion and earnings per diluted share of $0.53.

(Figures in millions, except per-share data)

Income Statement Highlights

Q4 2006

Q4 2005

Change

Sales

$1,171.2

$511.5

129.0%

Net Profit

$57.0

$10.8

425.5%

EPS

$1.38

$0.27

411.1%

Diluted Shares

41.2

39.7

3.7%



Get back to basics with a look at the income statement.

Margin Checkup

Q4 2006

Q4 2005

Change*

Gross Margin

22.7%

20.8%

1.9

Operating Margin

7.9%

3.5%

4.4

Net Margin

4.9%

2.1%

2.7

*Expressed in percentage points

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q4 2006

Q4 2005

Change

Cash + ST Invest.

$1,091.0

$515.9

111.5%

Accounts Rec.

$40.9

$0.0

N/A

Inventory

No data

No data

No data



Liabilities

Q4 2006

Q4 2005

Change

Accounts Payable

$8.0

$4.9

64.7%

Long-Term Debt

$154.0

$155.5

(0.9%)



Learn the ways of the balance sheet.

Cash Flow Highlights

2006

2005

Change

Cash From Ops.

$512.7

$81.4

529.4%

Capital Expenditures

$35.5

$28.9

22.8%

Free Cash Flow

$477.1

$52.5

808.7%



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Related companies:

  • WellPoint (NYSE:WLP)
  • UnitedHealth Group (NYSE:UNH)
  • Sierra Health Services (NYSE SIE)
  • Molina Healthcare (NYSE:MOH)
  • Magellan Health Services (NASDAQ:MGLN)

Related Foolishness:

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