HARTFORD, Conn. - Aetna Inc. said Thursday its fourth-quarter profit rose 3 percent from membership growth and premium and fee rate increases, and the managed care provider benefited from continued cost cuts and stock buybacks.
Net income grew to $448.4 million, or 87 cents per share, from $434.1 million, or 80 cents per share, a year ago. Excluding items, profit totaled 88 cents per share in the latest period.
Revenue rose 12 percent to $7.14 billion from $6.36 billion a year ago.
Aetna had forecast fourth-quarter earnings of about 87 cents per share. Analysts polled by Thomson Financial predicted earnings of 88 cents per share on slightly higher $7.17 billion in revenue.
The company's combined medical-loss ratio, which measures the amount of money spent on services compared with the amount of payments collected, widened to 80.3 percent for the fourth quarter from 78.8 percent in the 2006 period.
Fourth-quarter total medical membership increased organically by 168,000. Including Goodhealth Worldwides 58,000 members, total medical membership at Dec. 31 was 16.85 million members compared with 16.61 million at Sept. 30 and 15.43 million a year ago.
Looking ahead, Aetna forecast first-quarter adjusted earnings of 92 cents per share and 2008 profit of $4.
Wall Street is predicting higher quarterly earnings of 94 cents per share and 2008 earnings per share of $4.03.
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