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Unit Sale Boosts CIGNA Profits

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NU Online News Service, Aug. 4, 2004, 4:22 p.m. EDT

Asset sales and efforts to control health claims costs helped increase second-quarter profits at CIGNA Corp., Philadelphia.[@@]

The managed care company is reporting $515 million in net income for the latest quarter on $4.6 billion in revenue, compared with a net loss of $53 million on $4.6 billion in revenue for the second quarter of 2003.

Net results for the latest quarter include a $269 million gain on the sale of CIGNA’s retirement benefits unit to Prudential Financial Inc., Newark, N.J., and net results for the second quarter of 2003 include $286 million in charges related to variable annuity death benefits.

If the effects of the unusual gains and charges were excluded, second-quarter profits would have increased to $246 million, from $158 million, CIGNA says.

The company ended the quarter providing or administering health coverage for 10 million people, down from 12 million people a year earlier.