-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, M5O/Oy/l4w1uVTkqHB/haWkp0d9U4VRe+mhhhghFj1BV42mkTaGrbjWtuQdTFtYc 2wuQz/+awanijPY1O4r8Gw== 0000893220-96-001787.txt : 19961101 0000893220-96-001787.hdr.sgml : 19961101 ACCESSION NUMBER: 0000893220-96-001787 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961030 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19961031 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CIGNA CORP CENTRAL INDEX KEY: 0000701221 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 061059331 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08323 FILM NUMBER: 96651321 BUSINESS ADDRESS: STREET 1: ONE LIBERTY PL 1650 MARKET ST STREET 2: P O BOX 7716 CITY: PHILADELPHIA STATE: PA ZIP: 19192-1550 BUSINESS PHONE: 2157611000 8-K 1 CIGNA CORPORATION FORM 8-K DATED 10/30/96 1 CONFORMED COPY SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) OCTOBER 30, 1996 CIGNA CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 1-8323 06-1059331 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) ONE LIBERTY PLACE, 1650 MARKET STREET, P.O. BOX 7716 PHILADELPHIA, PENNSYLVANIA 19192-1550 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (215) 761-1000 NOT APPLICABLE (Former name or former address, if changed since last report) 2 Item 5. Other Events. On October 30, 1996, the registrant issued a news release, a copy of which is filed as Exhibit 20 hereto and is incorporated herein by reference. Item 7. Financial Statements and Exhibits. (c) The exhibit accompanying this report is listed in the Index to Exhibits below. Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CIGNA CORPORATION Date: October 30, 1996 By: /s/ Gary A. Swords ------------------------------- Gary A. Swords Vice President and Chief Accounting Officer Index to Exhibits
Number Description Method of Filing - ------ ----------- ---------------- 20 CIGNA Corporation Filed herewith. news release dated October 30, 1996
-2- EX-20 2 CIGNA CORPORATION NEWS RELEASE DATED 10/30/96 1 NEWS RELEASE [CIGNA Logo] EXHIBIT 20 IMMEDIATE ROBERT W. SULLIVAN, FINANCIAL RELATIONS - (215) 761-6130 MICHAEL J. MONROE, MEDIA RELATIONS - (215) 761-6133 CIGNA'S THIRD QUARTER 1996 RESULTS PHILADELPHIA, OCTOBER 30, 1996 -- CIGNA Corporation (NYSE:CI) today reported third quarter 1996 operating income* of $270 million, or $3.55 per share, versus a loss of $579 million, or a loss of $7.94 per share, reported in the third quarter of 1995. The third quarter 1995 loss included $849 million of after-tax adjustments for asbestos and environmental (A&E), cost reduction and unrecoverable reinsurance charges. Excluding these adjustments, third quarter 1995 operating income was $270 million, or $3.70 per share ($3.57 per share assuming full conversion of 8.2% convertible debentures, announced as of the third quarter of 1995), and includes no A&E losses. Third quarter 1996 results include $18 million of catastrophe losses, $13 million due to Hurricane Fran. This compares with $5 million of catastrophe losses in the third quarter of 1995. Operating income for the nine months of 1996 was $741 million, or $9.68 per share, compared with a loss of $244 million, or a loss of $3.36 per share, for the nine months of 1995. Operating income for the nine months of 1995, before adjustments, was $605 million, or $8.33 per share. "Our third quarter and year-to-date results continue to reflect strong performance in our life and pension businesses. Health results are solid but remain a focus for improvement. Property and Casualty results, excluding the effect of Hurricane Fran, showed continued improvement," said Wilson H. Taylor, CIGNA's Chief Executive Officer. * OPERATING INCOME (LOSS) IS DEFINED AS NET INCOME (LOSS) EXCLUDING REALIZED INVESTMENT GAINS AND LOSSES. 2 - 2 - FURTHER INFORMATION ON THE THIRD QUARTER AND NINE MONTHS OF 1995, BEFORE AND AFTER ADJUSTMENTS, IS PROVIDED ON THE ATTACHED FINANCIAL INFORMATION PAGE ALONG WITH 1996 RESULTS. THE FOLLOWING SEGMENT DISCUSSIONS OF OPERATING RESULTS EXCLUDE THE 1995 ADJUSTMENTS. SEGMENT RESULTS: EMPLOYEE LIFE AND HEALTH BENEFITS This segment, which includes CIGNA's HMO and indemnity operations, had operating income of $127 million in the third quarter of 1996. This compares with operating income of $136 million in the third quarter of 1995. For the nine months of 1996, operating income was $360 million, compared with $369 million in 1995. HMO medical membership grew by about 400,000 covered lives or 10% since September 30, 1995. EMPLOYEE RETIREMENT AND SAVINGS BENEFITS This segment, which operates in the defined contribution and defined benefit markets, had operating income of $52 million in the third quarter of 1996. This compares with operating income of $48 million in the third quarter of 1995. For the nine months of 1996, operating income was $147 million, compared with $143 million in 1995. Assets under management at September 30, 1996, were $39.0 billion, an increase of 5% from $37.2 billion as of September 30, 1995. 3 - 3 - INDIVIDUAL FINANCIAL SERVICES This segment, which includes individual and corporate-owned life insurance, life, accident and health reinsurance, and annuity businesses, had operating income of $47 million in the third quarter of 1996. This compares with operating income of $36 million in the third quarter of 1995. For the nine months of 1996, operating income was $121 million, compared with $112 million in 1995. PROPERTY AND CASUALTY* The property and casualty (P&C) segment, which includes the Ongoing operations (International and Domestic) and Runoff, had operating income of $58 million for the third quarter of 1996. This compares with operating income of $66 million for the third quarter of 1995. For the nine months of 1996, operating income was $159 million, compared with $35 million in 1995. Ongoing operations had operating income of $57 million for the third quarter of 1996. This compares with operating income of $47 million for the third quarter of 1995. For the nine months of 1996, operating income was $154 million, compared with $79 million in 1995. The combined ratio in the third quarter of 1996 was 100%. After-tax catastrophe losses for the Ongoing operations were $18 million and $3 million for the third quarter of 1996 and 1995, respectively. The third quarter 1996 catastrophes included $13 million of after-tax losses due to Hurricane Fran. For the nine months of 1996, after-tax catastrophe losses for the Ongoing operations were $38 million compared with $29 million in 1995. * AMOUNTS FOR 1995 ARE REPORTED ON A PRO FORMA BASIS AS THOUGH THE DOMESTIC P&C RESTRUCTURING, WHICH WAS EFFECTIVE AS OF DECEMBER 31, 1995, WAS IN PLACE AT THE BEGINNING OF 1995. THESE PRO FORMA RESULTS ARE NOT NECESSARILY INDICATIVE OF THE RESULTS THAT WOULD HAVE BEEN REPORTED HAD THE RESTRUCTURING ACTUALLY OCCURRED AS OF JANUARY 1, 1995. CONSOLIDATED P&C SEGMENT AMOUNTS FOR 1995 DID NOT CHANGE. 4 - 4 - International had operating income for the third quarter of 1996 of $37 million, compared with income of $36 million in 1995. The combined ratio was 92% for the third quarter of 1996 and 1995. For the nine months of 1996, International's operating income was $102 million, compared with $84 million in 1995. Domestic had operating income of $20 million for the third quarter of 1996, compared with income of $11 million in 1995. The combined ratio for the third quarter of 1996 was 108%, compared with 111% for the comparable period of 1995. For the nine months of 1996, Domestic's operating income was $52 million, compared with a loss of $5 million in 1995. Run-off had operating income of $1 million in the third quarter of 1996, compared with income of $19 million for the same period in 1995. OTHER Other Operations, which includes unallocated investment income, expenses (principally debt service) and taxes, as well as the results of CIGNA's investment and real estate subsidiaries and settlement annuity business, had an operating loss of $14 million in the third quarter of 1996. This compares with an operating loss of $16 million in the third quarter of 1995. For the nine months of 1996, the operating loss was $46 million, compared with a loss of $54 million in 1995. NET INCOME Consolidated net income for the quarter was $281 million ($3.69 per share), compared with $283 million ($3.88 per share), before the noted adjustments, a year ago. For the nine months of 1996, consolidated net income was $750 million ($9.80 per share), compared with $778 million ($10.71 per share), before the noted adjustments, a year ago. Including the adjustments, the 5 - 5 - consolidated net loss for the third quarter and nine months of 1995 was $566 million ($7.76 per share) and $71 million ($0.98 per share), respectively. The 1996 third quarter consolidated net income included after-tax realized investment gains of $11 million ($0.14 per share), compared with gains of $13 million ($0.18 per share) for the same period of 1995. The nine months of 1996 consolidated net income included after-tax realized investment gains of $9 million ($0.12 per share), compared with gains of $173 million ($2.38 per share) for the same period of 1995. The significant investment gains in the nine months of 1995 reflect the effects of restructuring the equity portfolio. REVENUES Consolidated revenues for the third quarter of 1996 were $4.7 billion, compared with $4.6 billion for the same period in 1995. For both the nine months of 1996 and 1995, consolidated revenues were $14.1 billion. ASSETS/SHAREHOLDERS' EQUITY Assets at September 30, 1996, were $97.3 billion, compared with $95.9 billion at year-end 1995. Shareholders' equity was $7.0 billion ($93.22 per share) at September 30, 1996, compared with $7.2 billion ($93.76 per share) at December 31, 1995. ### 6 CIGNA CORPORATION COMPARATIVE SUMMARY OF FINANCIAL RESULTS (Dollars in millions, except per share amounts)
================================================================================================================== Three Months Ended Nine Months Ended September 30, September 30, 1996 1995 1996 1995 - ------------------------------------------------------------------------------------------------------------------ REVENUES Premiums and fees $ 3,444 $ 3,408 $ 10,333 $ 10,340 Net investment income 1,069 1,080 3,263 3,192 Other revenues 154 134 448 391 Realized investment gains 18 20 17 226 - ------------------------------------------------------------------------------------------------------------------ Total $ 4,685 $ 4,642 $ 14,061 $ 14,149 ================================================================================================================== OPERATING INCOME (LOSS) BY SEGMENT (1) Employee Life and Health Benefits: Indemnity operations $ 73 $ 78 $ 198 $ 204 HMO operations 54 38 162 145 --------- ---------- -------- --------- Total Employee Life and Health Benefits 127 116 360 349 Employee Retirement and Savings Benefits 52 48 147 143 Individual Financial Services 47 36 121 112 Property and Casualty (2): Domestic 20 (49) 52 (65) International 37 36 102 84 --------- ---------- -------- --------- Ongoing operations 57 (13) 154 19 Run-off operations 1 (750) 5 (813) --------- ---------- -------- --------- Total Property and Casualty 58 (763) 159 (794) Other Operations (14) (16) (46) (54) - ------------------------------------------------------------------------------------------------------------------ Total $ 270 $ (579) $ 741 $ (244) ================================================================================================================== NET INCOME (LOSS) BY SEGMENT Employee Life and Health Benefits: Indemnity operations $ 76 $ 79 $ 195 $ 305 HMO operations 54 38 162 145 --------- ---------- -------- --------- Total Employee Life and Health Benefits 130 117 357 450 Employee Retirement and Savings Benefits 57 48 158 145 Individual Financial Services 47 37 121 112 Property and Casualty (2): Domestic 20 (43) 53 (9) International 39 40 114 87 --------- ---------- -------- --------- Ongoing operations 59 (3) 167 78 Run-off operations - (753) (7) (818) --------- ---------- -------- --------- Total Property and Casualty 59 (756) 160 (740) Other Operations (12) (12) (46) (38) - ------------------------------------------------------------------------------------------------------------------ Total $ 281 $ (566) $ 750 $ (71) ================================================================================================================== WEIGHTED AVERAGE SHARES OUTSTANDING (thousands) 76,055 72,908 76,585 72,561 ================================================================================================================== EARNINGS PER SHARE: Operating income (loss) (1) $ 3.55 $ (7.94) $ 9.68 $ (3.36) After-tax realized investment gains 0.14 0.18 0.12 2.38 - ------------------------------------------------------------------------------------------------------------------ Net income (loss) $ 3.69 $ (7.76) $ 9.80 $ (0.98) ================================================================================================================== SHAREHOLDERS' EQUITY at September 30 $ 7,008 $ 6,394 ================================================================================================================== SHAREHOLDERS' EQUITY PER SHARE at September 30 $ 93.22 $ 86.38 ==================================================================================================================
(1) Operating income is defined as net income excluding after-tax realized investment results. (2) Amounts for the Property and Casualty segment's Domestic and Run-off operations for 1995 are reported on a pro forma basis as though the Property and Casualty restructuring, which was effective as of December 31, 1995, was in place at the beginning of 1995. These pro forma results are not necessarily indicative of the results that would have been reported had the restructuring actually occurred as of January 1, 1995. Consolidated Property and Casualty segment amounts for 1995 did not change. 7 CIGNA CORPORATION SUPPLEMENTAL FINANCIAL INFORMATION FINANCIAL DATA EXCLUDING SPECIFIC ADJUSTMENTS - RESULTS OF OPERATIONS (Dollars in millions, except per share amounts)
Employee Life & Health Benefits Employee Retirement & Indemnity HMOs Total Savings Benefits Three months ended September 30, 1996 1995 1996 1995 1996 1995 1996 1995 ------------------------------------------------------------------ Operating income (loss) before adjustments $73 $87 $54 $49 $127 $136 $52 $48 Asbestos / environmental charge - - - - - - - - Cost reduction charges - (9) - (11) - (20) - - Reinsurance charge - - - - - - - - ------------------------------------------------------------------ Operating income (loss) as published 73 78 54 38 127 116 52 48 ------------------------------------------------------------------ After-tax realized investment gains 3 1 - - 3 1 5 - ------------------------------------------------------------------ Net income (loss) $76 $79 $54 $38 $130 $117 $57 $48 =================================================================================================================
Individual Financial Property & Earnings Services Casualty Other Consolidated Per Share Three months ended September 30, 1996 1995 1996 1995 1996 1995 1996 1995 1996 1995 ----------------------------------------------------------------------------- Operating income (loss) before adjustments $47 $36 $58 $66 ($14) ($16) $270 $270 $3.55 $3.70 Asbestos / environmental charge - - - (686) - - - (686) - (9.41) Cost reduction charges - - - (55) - - - (75) - (1.03) Reinsurance charge - - - (88) - - - (88) - (1.20) ----------------------------------------------------------------------------- Operating income (loss) as published 47 36 58 (763) (14) (16) 270 (579) 3.55 (7.94) ----------------------------------------------------------------------------- After-tax realized investment gains - 1 1 7 2 4 11 13 0.14 0.18 ----------------------------------------------------------------------------- Net income (loss) $47 $37 $59 ($756) ($12) ($12) $281 ($566) $3.69 ($7.76) ============================================================================================================================
Employee Life & Health Benefits Employee Retirement & Indemnity HMOs Total Savings Benefits Nine months ended September 30, 1996 1995 1996 1995 1996 1995 1996 1995 ------------------------------------------------------------------ Operating income (loss) before adjustments $198 $213 $162 $156 $360 $369 $147 $143 Asbestos / environmental charge - - - - - - - - Cost reduction charges - (9) - (11) - (20) - - Reinsurance charge - - - - - - - - ------------------------------------------------------------------ Operating income (loss) as published 198 204 162 145 360 349 147 143 ------------------------------------------------------------------ After-tax realized investment gains (losses) (3) 101 - - (3) 101 11 2 - ----------------------------------------------------------------------------------------------------------------- Net income (loss) $195 $305 $162 $145 $357 $450 $158 $145 =================================================================================================================
Individual Financial Property & Earnings Services Casualty Other Consolidated Per Share Nine months ended September 30, 1996 1995 1996 1995 1996 1995 1996 1995 1996 1995 ---------------------------------------------------------------------------- Operating income (loss) before adjustments $121 $112 $159 $35 ($46) ($54) $741 $605 $9.68 $8.33 Asbestos / environmental charge - - - (686) - - - (686) - (9.45) Cost reduction charges - - - (55) - - - (75) - (1.03) Reinsurance charge - - - (88) - - - (88) - (1.21) ---------------------------------------------------------------------------- Operating income (loss) as published 121 112 159 (794) (46) (54) 741 (244) 9.68 (3.36) ---------------------------------------------------------------------------- After-tax realized investment gains (losses) - - 1 54 - 16 9 173 0.12 2.38 - --------------------------------------------------------------------------------------------------------------------------- Net income (loss) $121 $112 $160 ($740) ($46) ($38) $750 ($71) $9.80 ($0.98) ===========================================================================================================================
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