United Health Earns $1.2 Billion in Fourth Quarter
UnitedHealth Group on Thursday reported net income of $1.2 billion for the fourth quarter on sales of $18.16 billion, but said that earlier results are not comparable due to problems relating to its granting of stock options.
UnitedHealth reiterated that "previously reported operating costs did not correctly reflect non-cash stock-based compensation expenses related to historic stock option grants." The company also did not provide per-share guidance.
But based on the number of shares outstanding, UnitedHealth's quarter per-share profit works out to about 86 cents per share, which is a penny better than the Thomson Financial consensus estimate. Sales of $18.16 billion slightly missed expectations of $18.23 billion.
The company is in the midst of emerging from an options backdating scandal. The company closed one chapter of that book during the quarter when its chief executive, William McGuire, stepped down. McGuire resigned amid regulators' probes into the company's methods of setting strike prices for options retroactively to a date when the stock was inexpensive.
Looking ahead, UnitedHealth reiterated that it expects earnings of $4.7 billion to $4.75 billion for 2007, and a profit of $980 million to $1 billion in the first quarter. Sales for 2007 are still expected to be around $79.5 billion.
The company said it did not have a timeline for resolving issues related to stock-option expenses.