Cigna Corp [CI] Filings

10-Q 1 ci-20220630.htm 10-Q ci-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission File Number 001-38769

Cigna Corporation

(Exact name of registrant as specified in its charter)


Delaware			82-4991898
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

900 Cottage Grove Road

Bloomfield, Connecticut 06002

(Address of principal executive offices) (Zip Code)

(860) 226-6000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01	CI	New York Stock Exchange, Inc.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

As of July 29, 2022, 305,116,202 shares of the issuer’s common stock were outstanding.

Cigna Corporation

TABLE OF CONTENTS


		Page
PART I	FINANCIAL INFORMATION

	Item 1. Financial Statements (Unaudited)	3
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Balance Sheets	5
	Consolidated Statements of Changes in Total Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to the Consolidated Financial Statements	9

	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	37

	Item 3. Quantitative and Qualitative Disclosures About Market Risk	55

	Item 4. Controls and Procedures	55

PART II	OTHER INFORMATION

	Item 1. Legal Proceedings	55

	Item 1A. Risk Factors	55

	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	56



	Item 6. Exhibits	57
SIGNATURE		58

As used herein, "Cigna" or the "Company" refers to one or more of Cigna Corporation and its consolidated subsidiaries.

Part I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS


Cigna Corporation Consolidated Statements of Income
	Unaudited				Unaudited
	Three Months Ended June 30,				Six Months Ended June 30,
(In millions, except per share amounts)	2022		2021		2022		2021
Revenues
Pharmacy revenues	$	31,972	$	30,047	$	62,669	$	58,072
Premiums	10,426		10,323		20,782		20,537
Fees and other revenues	2,757		2,451		5,295		4,792
Net investment income	325		310		739		701
TOTAL REVENUES	45,480		43,131		89,485		84,102
Benefits and expenses
Pharmacy and other service costs	31,150		29,001		60,963		56,236
Medical costs and other benefit expenses	8,192		8,484		16,460		16,489
Selling, general and administrative expenses	3,256		2,996		6,555		6,275
Amortization of acquired intangible assets	501		503		959		998
TOTAL BENEFITS AND EXPENSES	43,099		40,984		84,937		79,998
Income from operations	2,381		2,147		4,548		4,104
Interest expense and other	(301)		(298)		(600)		(612)
Debt extinguishment costs	—		(10)		—		(141)

Net realized investment gains (losses)	(95)		59		(414)		60
Income before income taxes	1,985		1,898		3,534		3,411
TOTAL INCOME TAXES	413		422		764		764
Net income	1,572		1,476		2,770		2,647
Less: Net income attributable to noncontrolling interests	13		9		28		19
SHAREHOLDERS' NET INCOME	$	1,559	$	1,467	$	2,742	$	2,628
Shareholders' net income per share
Basic	$	4.95	$	4.30	$	8.66	$	7.62
Diluted	$	4.90	$	4.25	$	8.57	$	7.54

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.


Cigna Corporation Consolidated Statements of Comprehensive Income
	Unaudited				Unaudited
	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2022		2021		2022		2021
Net income	$	1,572	$	1,476	$	2,770	$	2,647
Other comprehensive income (loss), net of tax
Net unrealized appreciation (depreciation) on securities and derivatives	(410)		122		(970)		(151)
Net translation gains (losses) on foreign currencies	(206)		16		(269)		(103)
Postretirement benefits liability adjustment	27		15		40		33
Other comprehensive income (loss), net of tax	(589)		153		(1,199)		(221)
Total comprehensive income	983		1,629		1,571		2,426

Comprehensive income (loss) attributable to noncontrolling interests
Net income attributable to redeemable noncontrolling interests	2		3		5		8
Net income attributable to other noncontrolling interests	11		6		23		11
Other comprehensive loss attributable to redeemable noncontrolling interests	(1)		(1)		(3)		(5)
Total comprehensive income attributable to noncontrolling interests	12		8		25		14
SHAREHOLDERS' COMPREHENSIVE INCOME	$	971	$	1,621	$	1,546	$	2,412

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.


Cigna Corporation Consolidated Balance Sheets
	Unaudited
	As of June 30,		As of December 31,

(In millions)	2022		2021
Assets
Cash and cash equivalents	$	4,421	$	5,081
Investments	754		920
Accounts receivable, net	18,290		15,071
Inventories	3,781		3,722
Other current assets	1,124		1,283
Assets of businesses held for sale	9,052		10,057
Total current assets	37,422		36,134
Long-term investments	16,724		18,438
Reinsurance recoverables	4,874		4,970
Deferred policy acquisition costs	742		677
Property and equipment	3,659		3,692
Goodwill	45,810		45,811
Other intangible assets	33,276		34,102
Other assets	2,628		2,728
Separate account assets	7,495		8,337
TOTAL ASSETS	$	152,630	$	154,889
Liabilities
Current insurance and contractholder liabilities	$	5,654	$	5,318
Pharmacy and other service costs payable	16,432		15,309
Accounts payable	7,142		6,655
Accrued expenses and other liabilities	7,742		7,322
Short-term debt	2,397		2,545
Liabilities of businesses held for sale	5,851		6,423
Total current liabilities	45,218		43,572
Non-current insurance and contractholder liabilities	11,777		12,563
Deferred tax liabilities, net	8,014		8,346
Other non-current liabilities	3,175		3,762
Long-term debt	30,984		31,125
Separate account liabilities	7,495		8,337
TOTAL LIABILITIES	106,663		107,705
Contingencies — Note 18
Redeemable noncontrolling interests	45		54
Shareholders' equity
Common stock (1)	4		4
Additional paid-in capital	29,930		29,574
Accumulated other comprehensive loss	(2,080)		(884)
Retained earnings	34,626		32,593
Less: Treasury stock, at cost	(16,588)		(14,175)
TOTAL SHAREHOLDERS' EQUITY	45,892		47,112
Other noncontrolling interests	30		18
Total equity	45,922		47,130
Total liabilities and equity	$	152,630	$	154,889

(1) Par value per share, $0.01; shares issued, 397 million as of June 30, 2022 and 394 million as of December 31, 2021; authorized shares, 600 million.

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.


Cigna Corporation
Consolidated Statements of Changes in Total Equity
Unaudited
Three Months Ended June 30, 2022
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at March 31, 2022	$	4	$	29,736	$	(1,492)	$	33,420	$	(15,581)	$	46,087	$	22	$	46,109	$	55
Effects of issuing stock for employee benefits plans			194						(1)		193				193
Other comprehensive loss					(588)						(588)				(588)		(1)
Net income							1,559				1,559		11		1,570		2
Common dividends declared (per share: $1.12)							(353)				(353)				(353)
Repurchase of common stock			—						(1,006)		(1,006)				(1,006)
Other transactions impacting noncontrolling interests			—								—		(3)		(3)		(11)
Balance at June 30, 2022	$	4	$	29,930	$	(2,080)	$	34,626	$	(16,588)	$	45,892	$	30	$	45,922	$	45


Three Months Ended June 30, 2021
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at March 31, 2021	$	4	$	29,254	$	(1,231)	$	29,389	$	(9,267)	$	48,149	$	6	$	48,155	$	59

Effect of issuing stock for employee benefit plans			152						(2)		150				150
Other comprehensive income (loss)					154						154				154		(1)
Net income							1,467				1,467		6		1,473		3
Common dividends declared (per share: $1.00)							(343)				(343)				(343)
Repurchase of common stock			—						(865)		(865)				(865)
Other transactions impacting noncontrolling interests			(3)								(3)		(5)		(8)		(10)
Balance at June 30, 2021	$	4	$	29,403	$	(1,077)	$	30,513	$	(10,134)	$	48,709	$	7	$	48,716	$	51

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.


Cigna Corporation
Consolidated Statements of Changes in Total Equity
Unaudited
Six Months Ended June 30, 2022
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at December 31, 2021	$	4	$	29,574	$	(884)	$	32,593	$	(14,175)	$	47,112	$	18	$	47,130	$	54

Effect of issuing stock for employee benefit plans			356						(73)		283				283
Other comprehensive loss					(1,196)						(1,196)				(1,196)		(3)
Net income							2,742				2,742		23		2,765		5
Common dividends declared (per share: $2.24)							(709)				(709)				(709)
Repurchase of common stock			—						(2,340)		(2,340)				(2,340)
Other transactions impacting noncontrolling interests			—								—		(11)		(11)		(11)
Balance at June 30, 2022	$	4	$	29,930	$	(2,080)	$	34,626	$	(16,588)	$	45,892	$	30	$	45,922	$	45

Six Months Ended June 30, 2021
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at December 31, 2020	$	4	$	28,975	$	(861)	$	28,575	$	(6,372)	$	50,321	$	7	$	50,328	$	58

Effect of issuing stock for employee benefit plans			431						(89)		342				342
Other comprehensive loss					(216)						(216)				(216)		(5)
Net income							2,628				2,628		11		2,639		8
Common dividends declared (per share: $2.00)							(690)				(690)				(690)
Repurchase of common stock			—						(3,673)		(3,673)				(3,673)
Other transactions impacting noncontrolling interests			(3)								(3)		(11)		(14)		(10)
Balance at June 30, 2021	$	4	$	29,403	$	(1,077)	$	30,513	$	(10,134)	$	48,709	$	7	$	48,716	$	51

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

Cigna Corporation

Consolidated Statements of Cash Flows


	Unaudited
	Six Months Ended June 30,

(In millions)	2022		2021
Cash Flows from Operating Activities
Net income	$	2,770	$	2,647
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,476		1,446
Realized investment (gains) losses, net	414		(60)
Deferred income tax (benefit)	(167)		(80)

Debt extinguishment costs	—		141
Net changes in assets and liabilities, net of non-operating effects:
Accounts receivable	(2,769)		(3,233)
Inventories	(59)		124
Deferred policy acquisition costs	(105)		(117)
Reinsurance recoverable and Other assets	265		(416)
Insurance liabilities	474		677
Pharmacy and other service costs payable	1,124		1,123
Accounts payable and Accrued expenses and other liabilities	(134)		(1,643)
Other, net	(15)		188
NET CASH PROVIDED BY OPERATING ACTIVITIES	3,274		797
Cash Flows from Investing Activities
Proceeds from investments sold:
Debt securities and equity securities	1,239		852
Investment maturities and repayments:
Debt securities and equity securities	863		672
Commercial mortgage loans	69		96
Other sales, maturities and repayments (primarily short-term and other long-term investments)	745		897
Investments purchased or originated:
Debt securities and equity securities	(2,024)		(1,999)
Commercial mortgage loans	(84)		(129)
Other (primarily short-term and other long-term investments)	(849)		(1,136)
Property and equipment purchases, net	(612)		(500)
Acquisitions, net of cash acquired	—		(1,836)
Divestiture, net of cash sold	(57)		—
Other, net	(22)		59
NET CASH (USED IN) INVESTING ACTIVITIES	(732)		(3,024)
Cash Flows from Financing Activities
Deposits and interest credited to contractholder deposit funds	84		96
Withdrawals and benefit payments from contractholder deposit funds	(94)

Cigna Corp [CI] Filings
10-Q	[2022-08-04]
10-Q	[2022-05-06]
10-K	[2022-02-24]
10-Q	[2021-11-04]
10-Q	[2021-08-05]
10-Q	[2021-05-07]
10-K	[2021-02-25]
10-Q	[2020-11-05]
10-Q	[2020-08-06]
10-Q	[2020-05-07]
10-K	[2020-02-27]
10-Q	[2019-10-31]
10-Q	[2019-08-01]
10-Q	[2019-05-02]
10-K	[2019-02-28]