The net income turned negative primarily because of a **non-cash after-tax investment loss of $1.8 billion** arising from the **impairment of VillageMD equity securities**. This significant loss reversed the previous strong net income performance, leading to the negative figures reported in Q1 2024.  **[0000950159-24-000134_ex99-1.htm:1]** **[20240502CG03207:0]** **[CI_3382088_0]** 

What led to the net income turning negative in Q1 2024?

The sharp spike in **net realized investment losses** in Q1 2024 was primarily caused by the **impairment of equity securities**. In particular, the company recorded a **$1.8 billion loss** related to the impairment of its investment in VillageMD, which reduced the carrying value of that investment to an estimated **$0.9 billion**.  **[20240502CG03207:1]** **[0001739940-24-000015_ci-20240331.htm:22]** **[0001739940-24-000015_ci-20240331.htm:21]** 

What caused the sharp spike in net realized investment losses in Q1 2024?

The negative total income taxes in Q4 2023 were driven primarily by a series of adjustments. Notably, the company recorded a significant **deferred tax asset of approximately $1.8 billion** related to Swiss tax attributes, which was partly offset by a **$772 million valuation allowance**. Additionally, it recognized **$584 million** in deferred tax benefits related to the sale of Medicare Advantage and related businesses, while foreign earnings had a more favorable impact on reducing the tax expense. Moreover, a **$1,290 million increase** in the valuation allowance contributed to the steep decline, resulting in the negative tax figure for the period.  **[0001739940-24-000005_ci-20231231.htm:214]** **[0001739940-24-000005_ci-20231231.htm:213]** 

Why were total income taxes negative in Q4 2023?

The significant jump in Pharmacy Revenues in Q1 2024 was primarily driven by **new business wins**—most notably, a collaboration with Centene that increased claims volume—along with **inflation on branded drugs** leading to higher prices. Additionally, there was substantial growth in **Specialty and Care Services**, particularly through the Curascript Specialty Distribution business, and a boost from **organic growth** through the expansion of existing client relationships.  **[0001739940-24-000015_ci-20240331.htm:40]** **[0001739940-24-000015_ci-20240331.htm:50]** **[CI_3382088_5]** **[20240502CG03207:2]** 

What factors contributed to the significant jump in Pharmacy Revenues in Q1 2024?

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The **Operating Cash Flow** drop in Q2 2024 was primarily due to **higher accounts receivable** (resulting from timing differences and organic business growth), the **absence of an early CMS payment** that was received in June 2023, and **higher insurance claim payments**. These factors significantly reduced the cash flows, although they were partially offset by favorable net cash flows from new clients.  **[0001739940-24-000028_ci-20240630.htm:48]** 

What caused Operating Cash Flow to drop so sharply in Q2 2024?

Operating cash flow nearly vanished in Q3 2024 primarily due to a combination of factors. There was a **higher increase in accounts receivable** driven by timing and organic business growth, along with **increased insurance claims and related payments** that negatively impacted cash inflows. In addition, an **absence of an early CMS payment**—which had been received in the comparable period of 2023—further contributed to the decline. These factors were only partially offset by the favorable cash flow impact from new clients in the Evernorth Health Services segment.  **[0001739940-24-000033_ci-20240930.htm:48]** 

Why did Operating Cash Flow nearly vanish in Q3 2024?

1d69430c1e9df46018dd1d345049346ebad0d0a7b967849e11e127780254fdbf

The documents do not provide a definitive reason for the sharp decline in cash and cash equivalents by Q3 2024. However, **potential contributing factors** mentioned include **increased operational cash flow usage**, **debt repayment**, **capital expenditures**, **share repurchases or dividend payments**, and **acquisitions or strategic investments**. These factors might have collectively led to the reduction from **$7,822 million as of December 31, 2023, to $5,888 million as of September 30, 2024**.  **[0001739940-24-000033_ci-20240930.htm:2]** 

Why did cash and cash equivalents drop so sharply by Q3 2024?

The jump in Q1 2024 was mainly driven by **the issuance of new senior notes and related debt tender offers**. On February 5, 2024, Cigna issued **$4.5 billion** in new senior notes. The proceeds were used to fund cash tender offers for existing debt, repay maturing senior notes, and support general corporate purposes such as share repurchases. Additionally, the company initiated tender offers to purchase up to **$2.55 billion** of existing notes and settled **$1.8 billion** early, all of which contributed to increasing the long-term debt balance from **$28,155 million** in Q4 2023 to **$31,053 million** in Q1 2024.  **[0001739940-24-000015_ci-20240331.htm:10]** **[0001739940-24-000005_ci-20231231.htm:161]** **[0001739940-24-000005_ci-20231231.htm:246]** 

What factors contributed to the jump in long-term debt in Q1 2024?

The **short-term debt** was significantly lower in **Q1 2024** primarily because of a **reduction in outstanding commercial paper**—which fell from **$1,237 million** to **$884 million**—and the **maturity and full repayment of the $500 million, 0.613% Notes due March 2024**. These actions contributed to lowering the debt from **$2,775 million** at the end of 2023 to **$1,715 million** in Q1 2024.  **[0001739940-24-000015_ci-20240331.htm:10]** **[0001739940-24-000015_ci-20240331.htm:2]** 

Why was short-term debt significantly lower in Q1 2024?

523edefd7f80115468d1f09caed4ef1eaea5683488faf1b3d369ddc2b564cf64

TOTAL SHAREHOLDERS' EQUITY (USD, millions)

bb8fc2eb6a463b5c92dcdf8ff8b020bad65a49d6d2f56644a3176df6854147e3

861f87191360d725665b3c3fc71799e6e007865a69cf671a9ae1c73961e73fa6

Pharmacy Revenues (USD, millions)

Premiums (USD, millions)

Fees and Other Revenues (USD, millions)

Net Investment Income (USD, millions)

Total Revenues (USD, millions)

Amortization of Acquired Intangible Assets (USD, millions)

Loss on Sale of Businesses (USD, millions)

Shareholders' Net Income (USD, millions)

110fbc39c362e86035dc80885f43635a001861401aba9abd531ebb94fc8d4cb8

b58884403584fcf45849394ae265d6fbef151fa6af3623f3fe5090f7c94bb513

Total Revenue [USD, Millions]

Cost of Goods Sold (COGS) [USD, Millions]

SG&A [USD, Millions]

R&D [USD, Millions]

D&A [USD, Millions]

Interest Expense [USD, Millions]

Operating Income (EBIT) [USD, Millions]

Net Income [USD, Millions]

EPS - Basic [USD, Per Share]

EPS - Diluted [USD, Per Share]

37975481cabb893f6a58016b72329a9d39f60091defb8d90e3de1d27fe73ccc3

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

2d95ecdcfee0a2e8e5ae9be9384526d8c160638bc638112266010ee96ea6ecdc

Cigna (CI)

Financials