Q2 2019 Earnings Call
Greetings and welcome to the Triple S management second quarter 2019 earnings call.
At this time, all participants are in listen only mode.
A brief question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad as a reminder, this conference is being recorded.
It is now my pleasure to introduce your host Garrett Edson Senior Vice President I see our.
Thank you Mr. Hudson you may begin.
Thank you and good morning, welcome to the Triple S Management second quarter 2019 earnings conference call with US today are your host Bobby Garcia, President and Chief Executive Officer of Triple S. One I'll say Romano Executive Vice President and Chief Financial Officer. In addition, Madeline Hernandez, Chief operating officer, and President of managed care will be available during Q1 day.
By now everyone should have access to the earnings announcement, which was released prior to this call. Much may also be found on the company's website at Triple S management Dot com.
Before we begin formal remarks, we need to remind everyone that each quarter Triple S management executives will provide their current view of the company's future and that they will be sharing forward looking information. These statements can be affected by risks and uncertainties involved in the business. Despite management's best efforts actual results may differ materially from such forward looking statements and what you hear on today's call. These statements are not guarantees of future performance and therefore undue reliance should not be placed upon them.
Further information on factors that could impact the company and the statements and projections contained herein. Please refer to the Safe Harbor section today's news release and the company's filings with the Securities Exchange Commission. Each forward looking statement a projection of financial information made during this call based on information available to US as of the date of this call. We disclaim any obligation to update our forward looking statements unless required by law.
In addition, this call is being webcast an archive version will be available shortly after the call ends on the Investor Relations portion of the company's website at Www Dot Triple S management Dot com.
If you cannot download a copy of the release you can contact us at 78779 to 648, and we will get one to you immediately and connect you to distribution list going forward with that I'd now like to turn the call over to Bobby Garcia. Please go ahead.
Thanks, Gary Good morning, everyone and thank you for joining us today.
This morning, we reported total operating revenue of $879 million for the second quarter of 2019 up 15% from a year ago and adjusted net income of one dollar and 12 cents per diluted share 155% higher than the adjusted net income.
After excluding the hurricane reserved development.
44 cents per diluted share that we reported a year ago.
This strong financial performance was driven by a marked improvement in our managed care segment, along with solid results in our life and PNC segments.
More importantly, it reflects the hard work commitment and relentless focus of the entire triple S team, which is executing superbly on the strategic transformation, we launched in 2016.
As you may recall over the last.
Several years, we've discussed our three pronged strategy Atlanta.
First we didn't retain Medicare advantage business.
Second enable our members providers and employees with advanced technology to improve outcomes and third develop an integrated approach to care delivery building and leveraging on our ambulatory clinic network.
The second quarter's results along with the study progress of our strategic and operational initiatives give us the confidence to improve our full year 2019 guidance once again.
I'll provide details on our revised outlook in a few minutes.
But first I'd like to address several drivers of the continued improvement in our core managed care segment.
Importantly, Medicare advantage premiums increased 31% from the prior year period.
Reflecting higher premium rates and more membership.
We attribute this growth to three factors.
First a more competitive and strategic product design.
Second concerted marketing sales and retention initiatives.
And third a strong revenue management program with growing expertise and the accurate and timely capture of our members medical conditions.
As we mentioned last quarter, we would expect these growth trends to continue into 2020.
When our H. ammo contract will have a 4.5 star rating.
And our PPL contracts will be the only such products in Puerto Rico to have earn four stars.
Medicaid is also showing strong growth.
Although we are outside of the open enrollment period.
We added 9000, new members in the second quarter.
Bringing us to nearly.
364500 beneficiaries as of June Thirtyth.
That correlates to 85000, new members or a 30% increase in membership in just eight months under the new program reaffirming our position as its market leader.
Finally, our fully insured commercial business has remained stable and is showing slight year over year membership growth.
Also reflecting a more competitive product offering and a more strategic approach to market.
Turning to recent events in Puerto Rico, We know there's been a lot of national press regarding the island's political environment and its potential impact on the island's economy. So let me address this topic briefly.
While the massive protests that led to the elected governors resignation and a quick removal of his chosen successor to yesterday's unanimous decision of the Puerto Rico Supreme Court or unusual events.
They also validate the strength of Puerto Rico's democracy.
Both transitions have been orderly and have followed the rule of law.
Although tourism has been temporarily affected business across the island has by and large continued uninterrupted.
We're monitoring the political situation closely but we remain positive that these events will have no lasting impact on Puerto Rico's economy.
As of June the unemployment rate in Puerto Rico stood at 8.4%. This is the lowest unemployment rate in 55 years.
Net job creation also included increased by 7100 in June over the previous year with jobs growing in the private sector, but shrinking in the public sector as part of the government's fiscal restructuring.
Private sector jobs reached the highest level in five years.
The Puerto Rico Treasury Department recently reported a record number for revenue collection for fiscal year 2019.
At $11.3 billion, 22% over the previous year.
This number surpassed the estimates prepared by the financial oversight management Board.
Although the increase in revenues in part reflects recovery and reconstruction efforts after hurricane Maria.
We are encouraged that a key driver was the corporate income tax category, which recorded a 40% year over year increase.
While still a bit early the economic recovery since the hurricane appears to be real.
Migration trends seem to have stabilized the private sector is creating jobs and we remain optimistic about Puerto Rico's long term economic future.
A quick update on PMC.
We remain comfortable with the levels of our reserves with respect to hurricane related claims and this segment continues to be profitable as we focus on more conservative underwriting and take advantage of a hard market.
Juan Jose will be providing more details on our PNC business in a few minutes.
Finally.
Yesterday, we completed the conversion of our remaining outstanding class a shares to class B and effectively eliminated our dual class structure.
Our new single class of common share simplifies, our capital structure, which should help enhance value for our shareholders over time.
Overall, we're very pleased with our second quarter and first half of 2019.
As we continue to make strong progress with respect to our long term strategy.
In terms of our 2019 full year guidance, we are raising our operating revenue and adjusted net income expectations.
Improving our operating expense ratio and maintaining our consolidated claims incurred and ml our ratios.
Specifically, we are raising our expectations for full year operating revenue to be between three point $29 billion and $3.33 billion, which includes raising expectations for managed care premiums earned net to be between two point $95 billion and 2.9 billion.
We're maintaining expectations for our consolidated claims incurred ratio to be between 81.3.
And 83.3%.
And then while our to be between 84 and 86%.
We now expect our operating expenses as a percentage of total premiums earned and administrative service fees to be between 17, and 17.5%, which is an improvement from the previous range of 17.6% to 18.6%.
We are adjusting our effective tax rate expectation as to now be between 29, and 33% a slight change from our prior guidance of 29% to 34%.
And on the bottom line, we are raising expectations for 2019, adjusted net income per diluted share.
To be between $2.40 and $2.60 from the earlier range of Oneninety.
To $2.10.
As a reminder, adjusted net income per diluted share excludes realized and unrealized investment gains and losses as well as any private equity investment income.
Accounts for the recently issued share dividend.
And does not account for any potential share repurchase activity during.
2019.
To sum up.
The hard work and effort we put in over the past few years into our various initiatives has begun to pay significant dividends for triple S. As evident in our second quarter and first half 2019 results.
We continue to gain and retained membership in our core managed care business, we're modernizing and optimizing our technology to further improve clinical outcomes member experience and our cost structure.
And our clinic networks continues to take shape as an important component of an integrated care delivery strategy.
Juan Jose will now provide you with more specific financials by business segment on <unk>. Thank you <unk> and good morning to everyone on this call.
As we reported in our press release earlier today, we continue to show strong operating results during the second quarter and are pleased with our 2019 performance so far.
We reported second quarter GAAP diluted net income per share of $1.35 and adjusted diluted net income per share of $1.12 compared to GAAP net loss per share of $1.68 and adjusted net loss per share of $1.62 independent a year period.
The prior year Peter results were of course impacted by the 48 million after tax favorable prior year reserve development experienced by our B and C segment related to hear again Medea.
Our systems second quarter 2019 results were driven by the Booth operating results of our managed care segment, particularly the Medicare business as well as as well as our property and casualty segment.
Let me now this caused the managed care results in detail.
Managed care premiums earned for the quarter showed strong growth of 116 million or 17% over the same period last year.
Primarily reflecting increased membership in our Medicare and commercial businesses.
And a higher average premium rates across all our managed care lines of business, particularly in the Medicare and Medicaid businesses.
The higher average premium rate in the Medicare business reflect primarily reflects an increase in the abolition membership risk score.
In the case of Medicaid business the increase in the average premium rate is due to the changing their goal remains Medicaid motive as we now ensure members across Puerto Rico, which results in higher average premium rates per member then when we shouldn't members in only two regions under the previous contract in which premiums were below the island wide average.
All of these increases were partially offset by these year. He fee moratorium on increase of approximately 110000 member months, where Medicaid membership year over year, resulting from the aforementioned change in there, but I would add some model on anyone's going into that but it would have on November onest 2018.
Managed care claims were up 87 million year over year. One ml are at 84.5 was six 160 basis points lower than last year.
After adjusting for reserve development and Visco revenue.
Adjusted <unk> of the managed care segment was 85.3% 130 basis point higher than last year.
The higher adjusted their mother lastly to reflect the impact of benefits Werent any 19, Medicare product offerings. The opinion, I think hey fee moratorium on higher target that and what are the current mitigate contract.
As a reminder, they get it and mitigate contract requires a minimal enable our openedge do person.
Including the allocations to claim cost of health care quality improvement expenses.
These increases were mostly offset by higher premiums during the second quarter, if any 19 stable medical trends and the impact of cost containment initiatives.
Moving on to the managed care segment quarterly operating expenses.
The segment operating expenses declined 1 million from a year ago.
Reflecting a first million decreasing the hafey do they have any like the moratorium.
And partially offset by higher personnel costs professional services and commission expense.
Well, we do not provide quarterly guidance, we expect operating expenses in the second half of the year to be higher than the first half a penny 19, due mainly to enrollment season for their Medicare and Medicaid businesses as well as for the individual and small group and the fear that l. implementing Baroda, India commercial business.
Let me comment briefly on our life and property and casualty segments life premiums earned were up approximately 9% from the prior year period, primarily reflecting premium growth in this segment in the visual and cancer lines of business.
The segment's operating income remained steady at $5.2 million.
Property and casualty premiums written were up 4 million during the second quarter of 2019.
Mostly resulting from increased sales and higher premium rates, particularly in commercial accounts.
Premiums earned were down 1 million from a year ago, mostly reflecting a decrease in they change their brians.
The segment's operating income this quarter was $4.8 million compared to an operating loss of 71 million during the same quarter last year.
No if anything those reporting their 28 in quarter three so thats certainly a 76 million on favorable prior period reserve development related to hear again, Larry airplanes.
Our property and casualty segment, so almost no new claims activity this quarter related to you again Medea, receiving only 16, new claims our efforts remain focused on selling and closing here again related claims.
So today, the estimated gross losses related to lease even remain unchanged.
As of June Thirtyth 2019, we have paid 658 million in gross you Rick and related claims and expenses and have closed nearly 96% of total cases.
As of June 32019, our BMC RBC ratio is approximately 200 person.
After the first million in additional copy that we can't give you did during the second quarter and the positive results of its operations.
I think indicates a bold claim they have 80. These dividends necessity. If do you reckon Medea are based on our best estimate of the ultimate expected glow gossip claims with the information currently on hand and are subject to change.
Returning to our or whatever results consolidated income tax expense was 13 million compared to a benefit of 28 million in the prior year period.
Mostly reflecting the higher income before taxes of the managed care and property and casualty segments.
The income tax benefit in 2018, mainly reflects the loss would be for doctors report vetting that period by the property and casualty segment.
So that cash and investments at the moment at the parent company level was 33 million as of June 32019.
As well we mentioned we are pleased with our strong operating results. So far in 2019 and remain optimistic for the remainder of the year. Our focus continues to be our overall long term growth strategy.
Further progress on our working each of these and position the company for the future.
We will now proceed toward Geelani section operator, please open the call for questions.
Thank you we will now be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad, a confirmation total indicate that your.
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One moment, please while we pull for questions.
The first question is from Peter Costa.
Wells Fargo. Please go ahead Sir.
Good morning nice quarter.
Let me ask you a couple of questions about the topline first yeah.
Very big growth sequentially looks like there was a Medicare risk score true up payment.
Your commentary it sounds like there was something in there can you describe how much of that revenue increase this quarter was an out of period.
Risk score true up.
In these hyping it is one wholesale.
This quarter, we reported.
It could well be in the Medicaid yeah in the Medicaid business of around $5 million of prior periods.
Well as we have adjustments related to our Medicare Medicare business that's around.
Lenny.
But $12 million.
That's that's reserve development, though but I'm talking about on the topline no no on the top line. So hard on this color. Yes. It does 12 million is out of period.
For the Medicare business not more than that because your guidance for revenue implies it's a bigger number.
No. These are a couple of things I mean, let me go back so Frisco revenue related to prior periods that include Q1 and prior year east around $12 million. We also have a retroactive premium adjustment related to the Medicaid business of around $13 million.
And lastly, we have l. Parsi dwell adjustments of our own $7 million. Those are the adjustment recognized in Q2 related to Q1 19 and prior year.
Kind of closer.
So just to be smart sort of 5 million in Medicaid 12 million in Medicare and then another 13 million retro in Medicaid and then 7 million and dual adjustments.
So it's a total of 37 million in prior period.
I'm sorry, a rare.
Yep.
They mitigate Freeman is not five my vote is 13 million.
13, okay.
So then that was double that so.
Really 32 million.
Revenue.
Okay.
All right. Thank you.
And then looking at.
Your your.
You know I got to go through the Hurricane stuff again, just to make sure we touch base with that what's the total number of claims on that you received at the end of the second quarter.
So tell me CZ 17786.
Okay.
And then the gross book liabilities that you said that was the same so that's a 967 million is that correct that's correct.
And then the.
Paid claims is 658, how many you received claims have you got still.
On the bucks or beyond what what's paid so stuff you've received but.
Uh huh.
Receive an update.
Yes, correct.
That's 700.
Oh 700 claims.
And whats the dollar value of those.
Oh, so we see having reserve around 309 million.
One of the 309 is IB NR.
But on that from that a we have an idea and art 2 million and Ivy on our close a ball reserves 18 million.
Okay.
That's stayed about the same as it was last quarter last 2 million and I'd be are okay.
So very stable at this point.
Yes, okay that all sounds pretty good.
Yeah, you look at some of the videos of the protest and things like that and I started thinking about claim damage again and did you see any increase in claim damage to your PNC business from the protests or do you expect any no doubt all we did and so any on were not expecting any there were minor really issues on the streets, putting demo claims no one.
Okay. So.
Don't pay attention to the video you have to answer [laughter]. However, it was a very limited so.
All right.
Looking at your tax rate guidance just.
Help me understand that you talked about higher managed care earnings, which implies a higher tax rate, but yet you lowered your tax rate guidance can you explain what's going on there.
Yeah remember that in Puerto Rico, we them fake <unk> taxes are paid on individual legal entities note on a consolidated basis, that's why probably moved earlier been oh, so each MPD as they move into some of the income before taxes that it will even back later beat our ratio. That's why the movie leader being you know every quarter. I said reminder, for example in our life company, we usually pay on their 10% effective tax rate, while no war and managed care top rate is 37.5 person. So it moves a little bit based on how in each different legal entities. They income change.
Right. So managed care seems like it has the higher tax rate and there seems to be more earnings in the managed care segment. So you think that would drive your guidance for tax rate higher not lower.
And instead you took the top end of your range down a little bit.
Yeah, well a leader be to have to do that in the first half of the year.
We have ano wells put on from prior years that we were able to use.
And died when when it goes through they the docs calculation actually have the impact of increasing our effective tax rate.
So as we continue to as we re gas today, a reminder of the year.
Based on the expected profitabilities, how or why.
Although we have higher income really is just the impact of the use of animals that virtually a change their ratios.
Okay.
Thank you.
And then prior period development in the quarter was positive in all three.
<unk> commercial Medicare and Medicaid.
Oh for the quarter.
They were close it is yes.
[noise].
Okay.
And then just last question you beat the quarter by.
And I know, it's my estimate versus what you guys were thinking internally.
By little more than you raise guidance was there something in the back half that I should be.
I'm concerned about or that you're concerned about increasing in terms of cost, but one of the things right. So when we've been on our guidance.
The factors our first we took into consideration the prior period reserve developments in the first half an hour forecast assume no more positive or or neither of these developments.
Second we are expecting.
Higher opex in the second half mostly related to the open enrollment in Medicaid Medicare and in the case of commercial for our individual and small group and federal employees. So the second half of the year, we do expect a an increasing those expenses, mostly though they have to do with enrollment with advertising and everything that is related to an open enrollment season.
The other parties that we did recognizing the first half prior Peter that just means in the Medicaid that half to the week 20.
With last year of around $5 million.
And lastly, we did adjust our MPS considering the new number of outstanding shares as a result of the conversion and the issuance of our own another million shares that we read yesterday, so our estimate for the year concealer that.
And average for the remainder of the year.
Okay. So they thought the new total of shares outstanding will be 24 million 131.
Okay. So that also impacted Elater b. Riley BS because we're using now.
The new number got it makes sense.
And then I guess my last question is in the past when you've done conversions of class a class B shares it's taken time for those shares to.
Come out into the market sort of all at once.
Do you expect something similar this quarter.
Or do you think there will be more more speed here.
No.
He will always be Miller similar to that but it will be very slow it will take a month before because now every people have to come and make that the conversion of the the word paper and really the story has been forever that it takes a lot of time before people actually convert and then they decide what to do right. If they sell their this book.
Got it and the increased or perhaps increased risk to class b shareholders from your pre IPO conversion.
You know that the that used to be borne by the class a shareholders now that's on all the shareholders can you talk about why now is the time to have done this conversion and just go through sort of your thought process on.
The if there's increased risk to the class b shareholders.
Yeah, Hi, Peter as Bobby I'll take that question are there a couple considerations first is if you recall from from the IPO. The the risks that are those.
Potential claimants represented back then was thought to be much larger than what actually materialize.
At the same time, the cases that didn't materialize took a long way to make it through the court system.
So even though we could have converted all the A's and B's after five years from the time of the IPO.
We decided to wait to feel more comfortable that we had good case law on our side.
And that.
As time passed we would have a better sense of whether potential claimants would actually materialize.
And what we saw is that we did end up with with some decisions at the appellate court level that this is not a.
All of these cases has actually had a.
A decision by the Puerto Rico Supreme Court.
But the standard of review was the statue limitations. The most lenient statute limitations, which is 15 years and so if you count back from today 15 years.
That that's 2000 2004 and.
All those redemptions of shares.
Occurred by then so taking the data redemption is that as the commencement of the of the statue limitations.
Any potential claim is at this point would be time barred.
So when you consider that plus the development of the existing cases every day, we have fewer cases.
We thought it was right time to do it as we balance the interest of having a single class of shares.
Versus maintaining that that protection against what we consider the.
Much diminished.
The risk.
Perfect. Thank you very much.
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The next question is from Sarah Jones Piper. Please go ahead mr.
Thank you and good morning.
You guys improved your S. unit guidance pretty meaningfully I was hoping you could walk us through some of the math there how much of that was from.
The higher revenue.
Versus initiative that you guys are working on maybe you could talk a little bit about your.
Overhead expense initiatives that you have going on and if you can comment at all about operating leverage should we think about this going forward as being similar relationships as your revenue growth to how much actually and they may go down. Thanks.
Good morning, Sarah This is what I will say, yes. So there's a good reason that Jos many in our focus is really mostly as a result of the significant increase in our revenues.
We have a significant increase on a war gaming business and the increasing cost just to absorb that increase being given that goes he is not that significant.
Going forward, so thats a multi their recent photo what adjustment.
Going forward, we believe that there are then there would be opportunities in the future and we don't we have not provide guidance in the future, but for the future, but in general we were still investing in our initiative clinical initiative and bringing the operations. So at some point, we should see also some benefits of completing those those initiatives.
Got it.
And then you flagged the higher risk scores on M&A in your earlier comments.
Can you talk a little bit about what is driving that so do you guys have programs going on where maybe you're improving coding or did the benefit design change this year bring in a little bit different of a mix of members.
Yes is it mostly in brewing that called in and this is a result of various in each of these the first one is.
It focus with our providers.
Decent them just to do their right coding. So we have personnel on this threed I would the process to aggregate, our physicians or diverse and delivering for them just to be sure that they reflect the appropriate coordination of our members.
Also we have been making changes and improving in our systems that is allowing us to capture better and more data data at the same time.
Translate you know sending more information.
As part of our sending information to CMS. So all the combination of those actually are helping us to improve or to increase our risk scores.
Got it and should we think about this higher PMPM from the higher risk or being something that could improve your margin profile on the Medicare product or strategically are you putting it back into benefits and.
I guess some context about how should we think about the 2020 benefit design stability because you are offsetting the Hess now you've got these savings from the high risk score. So how do you balance wanting to improve margin versus.
Stabilize.
Benefits and gain share.
So for 22 any engine at a REIT, we will because we have enough for long guns, He oh and the mobility sign off our pro we took into consideration. The fact that they hate fee will be back on next year, but for next year, we took into consideration the higher average premium rate and especially the increase four to 4.5 stars. We are now in our nation more proud of where Forestar, where we'll be for running have which means we will have higher premium but also in our VPO. We went up from three stars to four stars. So both actually we saw an increase in their PMPM because of increasing the stars. The benchmark also I'm sorry, let me correct from 3.5 to Forestar Inovio.
Also the EBIT. So for next year, we will have increasing demand from our being decrease related to our increasing the stars and a better risk score, which increase our our average premium rates. All that was took into consideration when we prepared our bid so years at the end we balance.
Improving our benefits for next year, but also we clearly took into consideration the impact of the existing.
Got it but long term you still think about kind of a similar margin profile on Medicare.
And then before you have these in the scoring initiative.
Yes, so for yes.
We still see and opportunities.
In our war add me, but overall, yes, it will be yeah should should be around these or slightly better.
Got it.
And then last quarter, you gave us an update on the Medicaid product you know there have been some contract changes and you guys move to new PBM I was hoping you could give us another update now how you see.
And a liar trending on that product versus your expectations and benefits, you're you're realizing from the new PBM contract.
So in terms of our Medicaid.
He is tracking our beat on the contract at 92%.
So is tracking very well, maybe my coming you Mike Glenn before of our prior period adjustment has to do with a process, it's a new incentive program.
And so we have been reconciled all all of us participating there but over them.
Having reconciling life and the new sales rate.
With the garment Thats why we have seen some adjustment there has been done from quarter to quarter is part of this is a new program and they change from one average premium rate to 37 different rates. So we have been working with the government.
Significant progress has been done already but we're not done yet.
So but overall the program is working very well in malaria is really an hour cost is tracking our beat on our projections. So so far.
Please with how its tracking and Sarah this is Bobby Hello.
With respect to the PBM just.
No. The PBM change was for Medicare and our commercial business are actually for a commercial business because we consolidated with the PBM that how Remy business Medicaid.
ER has a PBM carve outs for the managed that directly.
So.
I'll anticipate your question that with respect to the to the PBM. We started out all January onest. It was a relatively seamless transition.
And we're seeing actually the benefits of that in part through a relatively flat.
Drug trends.
And.
We're starting to work with them on some joint clinical and pharmacy measures.
Thanks for the clarification, there probably that's that's helpful.
Last one is on on the clinics. So you guys have talked big picture that.
The clinic strategy could be something that helps increase.
Demand for your commercial products and sticking asking retention so as we gear up for the.
2020, commercial selling season, I'm wondering how you're thinking about the sales pitch now that you guys have more clinics opened and how initial conversations are going on the commercial sales side.
Yes, we see the clinics complementing our overall Uh huh.
Clinical strategy.
As we.
As we see the market there will be a continued trend and we see our.
Future is being.
At the center of an integrated delivery system.
Not necessarily owning all the components, but thats the direction, we want to head and so the clinics have a broader purpose than just commercial.
With respect to commercial we see different angles to this the larger accounts actually have been interested in in.
Im embedded work clinics so their on premise.
Helps them with their productivity with absenteeism.
And with overall, well being and some of the largest accounts some of our larger accounts have decided to set up. These claims. So we have a few running we have a few in the pipeline.
For small accounts and for individual accounts we've.
But looking at developing product that will have the clinic as a.
Part of the benefit so there would be a.
No co pay if you attend the clinics.
As part of that.
Product.
Yeah, we see it as.
Yes, addressing the stickiness question, helping us with retention and growth. We also see it as an integral part of a broader clinic, a clinical strategy that seeking to improve outcomes and reduce mode.
Yeah, that's still in the works as you know.
Great. Thank you.
There are no further questions at this time I'd like to turn the floor back over to Roberta Garcia for closing comments.
Thank you operator, I'd like to close by reiterating that the second quarter of strong results and the continued upward momentum over the last several years achieved despite a challenging environment in Puerto Rico.
Or a testimony to our employees commitment.
Sound long term strategy and the organization's focus on execution.
When we reported.
Our 2018 year end results. We stated at 2019 will be a pivotal year as we complete a number of foundational initiatives.
The building blocks. If you may have an integrated delivery system that we envision will enable healthy communities and increasingly focus on how to bring the different components of that system together.
Today, we can reaffirm that earlier statement, we made significant progress in our transformational journey and believe we are well positioned to generate sustainable long term growth and profitability.
For the company by creating a unique holistic member experience that combines innovative clinical programs of value based provider network advanced analytics competitive pricing and superior service.
We want to thank everyone for your time and ongoing support of Triple S. You have any additional questions. Please reach out.
Have a great morning.
This concludes today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation and have a good day.