Universal American swings to 1st-quarter loss

The company late Tuesday said it posted a $46 million loss, or 50 cents per share, versus a profit of $4.4 million, or 7 cents per share, a year earlier. The latest quarter included $29.8 million of impairment costs related to the company's subprime mortgage holdings.

Excluding items, Universal American lost 18 cents per share in the latest period.

Sales rose to $1.22 billion from $618.4 million, helped by growth in the company's Medicare Advantage business, which posted a 25 percent increase in membership.

Analysts polled by Thomson Financial expected a smaller loss of 16 cents per share and higher sales of $1.29 billion.

"Our operating loss was expected, due to the seasonality of our Part D businesses and, to a lesser extent, our Medicare Supplement business," Chairman and Chief Executive Richard Barasch said in a statement.

In March, Universal American lowered its fiscal 2008 profit outlook and said expected premium payments to MemberHealth, which it bought last year, will be softer than expected because of a decline in Medicare Part D payments.

The company backed its full-year 2008 profit outlook of earnings of $1.56 per share to $1.74 per share on revenue between $4.5 billion and $4.9 billion.

Analysts expect $1.62 in earnings and sales of $4.69 billion.

For the second quarter, the company forecast a profit between 18 cents and 22 cents per share and sales of $1.17 billion from $1.21 billion. Analysts forecast earnings of 29 cents per share and sales of $1.18 billion.