WellPoint profits rise, beat analysts’ expectations

A milder-than-expected flu season helped WellPoint Inc. boost first-quarter profits by 8 percent, excluding investment gains and special charges, the Indianapolis-based health insurer reported Wednesday morning.

The results handily beat the expectations of Wall Street analysts. But continuing high unemployment forced WellPoint to slightly weakened its full-year forecast.

Profits in the three months ended March 31 totaled $877 million, or $1.96 per share. Excluding investment gains and a special accounting charge, WellPoint earned $1.95 cents per share.

Analysts surveyed by Thomson Financial expected WellPoint to earn $1.66 per share.

In the same quarter a year ago, WellPoint earned $809 million, or $1.62 per share. The company has been trying to boost its per-share profit numbers by buying back shares. It spent $1.6 billion in the first quarter to do that.

Revenue in the first quarter fell slightly from a year ago to $15.1 billion.

WellPoint added 165,000 new insured customers during the quarter, which was more than company officials had expected. The company now insures 33.8 million people, more than any of its peers.

But WellPoint also expects to lose more customers this year than the 400,000 company officials predicted in March. At that time, WellPoint said its customer rolls would drop to 33.3 million by year’s end. Now, it expects to drop another 200,000 to 33.1 million.

WellPoint maintained its full-year profit forecast at $6 per share, including its first-quarter investment gains of 4 cents and the special accounting charge of 3 cents.

The company’s stock has fallen since last week’s Reuters story about the company’s rescission policies sparked another high-profile rebuke from the Obama administration and a counter-charge by WellPoint that the story was “grossly misleading.”

WellPoint’s stock price has skidded 4.6 percent since the Reuters story appeared on April 22. Its shares closed Tuesday at $55.92 apiece.