Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

Humana Inc., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	2,484)	2,802)	2,934)	3,367)	2,707)
Gain on sale of Gentiva Hospice	—)	(237)	—)	—)	—)
(Gain) loss on investment securities, net	54)	205)	130)	(838)	(62)
Gain on Kindred at Home equity method investment	—)	—)	(1,129)	—)	—)
Equity in net (earnings) losses	63)	4)	(65)	(74)	(14)
Stock-based compensation	175)	216)	180)	181)	163)
Depreciation	850)	749)	640)	528)	505)
Amortization	67)	96)	73)	88)	70)
Impairment of property and equipment	206)	248)	—)	—)	—)
Impairment of intangible assets	55)	—)	—)	—)	—)
Deferred income taxes	(167)	(100)	15)	195)	162)
Receivables	(337)	(54)	(280)	(85)	(32)
Other assets	(1,318)	(463)	(491)	(581)	118)
Benefits payable	915)	975)	104)	2,139)	1,142)
Other liabilities	841)	44)	176)	599)	471)
Unearned revenues	(20)	32)	(65)	71)	(36)
Changes in operating assets and liabilities, net of effect of businesses acquired and dispositions	81)	534)	(556)	2,143)	1,663)
Other, net	113)	70)	40)	49)	90)
Adjustments to reconcile net income to net cash provided by operating activities	1,497)	1,785)	(672)	2,272)	2,577)
Net cash provided by operating activities	3,981)	4,587)	2,262)	5,639)	5,284)
Proceeds from sale of Gentiva Hospice, net	—)	2,701)	—)	—)	—)
Acquisitions, net of cash and cash equivalents acquired	(233)	(337)	(4,187)	(709)	—)
Purchases of property and equipment	(1,004)	(1,137)	(1,342)	(964)	(736)
Proceeds from sale of property and equipment	210)	17)	26)	—)	—)
Purchases of investment securities	(7,552)	(6,049)	(7,197)	(9,125)	(6,361)
Proceeds from maturities of investment securities	1,292)	1,365)	2,597)	4,986)	1,733)
Proceeds from sales of investment securities	3,795)	2,434)	3,547)	2,747)	4,086)
Net cash used in investing activities	(3,492)	(1,006)	(6,556)	(3,065)	(1,278)
Receipts (withdrawals) from contract deposits, net	828)	1,993)	(306)	(939)	(623)
Proceeds from issuance of senior notes, net	2,544)	1,982)	2,984)	1,088)	987)
Repayment of senior notes	(1,832)	(1,000)	—)	(400)	(400)
Proceeds from issuance (repayments) of commercial paper, net	211)	(376)	352)	295)	(360)
Proceeds from short-term borrowings	100)	—)	—)	—)	—)
Repayment of short-term borrowings	(100)	—)	—)	—)	—)
Proceeds from term loan	—)	—)	2,500)	1,000)	—)
Repayment of term loan	(500)	(2,000)	(2,078)	(1,000)	(650)
Debt issue costs	(7)	(6)	(31)	—)	—)
Common stock repurchases	(1,573)	(2,096)	(79)	(1,820)	(1,070)
Dividends paid	(431)	(392)	(354)	(323)	(291)
Change in book overdraft	55)	(28)	6)	95)	54)
Other, net	(151)	9)	21)	49)	58)
Net cash provided by (used in) financing activities	(856)	(1,914)	3,015)	(1,955)	(2,295)
Increase (decrease) in cash and cash equivalents	(367)	1,667)	(1,279)	619)	1,711)
Cash and cash equivalents at beginning of period	5,061)	3,394)	4,673)	4,054)	2,343)
Cash and cash equivalents at end of period	4,694)	5,061)	3,394)	4,673)	4,054)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Net Income Trend: Net income increased from 2019 to 2020, reaching a peak in 2020 at 3,367 million USD, followed by a declining trend over the next three years, ending at 2,484 million USD in 2023. The gain on sale of Gentiva Hospice in 2022 (-237 million USD) and the gain related to Kindred at Home equity in 2021 (-1,129 million USD) influenced net income fluctuations during these periods.
Investment and Equity Earnings: There is notable volatility in gains and losses from investment securities and equity earnings. Gains or losses on investment securities were negative in 2019 and 2020 but positive in 2021 through 2023, though the magnitude diminished in 2023. Equity in net earnings showed negative figures from 2019 to 2021 but turned positive in 2022 and increased further in 2023, indicating improving performance or valuation of equity investments.
Operating Expenses and Non-Cash Charges: Depreciation consistently increased each year, from 505 million USD in 2019 to 850 million USD in 2023. Stock-based compensation fluctuated mildly but remained within a range of approximately 163 to 216 million USD. Amortization values varied without a clear trend. Impairments appeared in 2022 and 2023 for property, equipment, and intangible assets, indicating write-downs or asset revaluations in those years.
Income Tax and Balance Sheet Adjustments: Deferred income taxes showed decreasing values from a positive 162 million USD in 2019 to a negative 167 million USD in 2023, suggesting a tax asset/liability shift or tax strategy changes. Receivables had increased negative adjustments in 2021 and 2023, while “Other assets” declined notably in 2023, pointing to changes in asset composition or valuation. Benefits payable spiked significantly in 2020 but then remained variable, with another increase in 2022.
Operating Cash Flow: Net cash provided by operating activities peaked in 2020 at 5,639 million USD but fell sharply in 2021 to 2,262 million USD. It rebounded to 4,587 million USD in 2022 but decreased slightly again in 2023 to 3,981 million USD. Adjustments to reconcile net income to operating cash flow were positive in most years except for a notable negative adjustment in 2021, which may have contributed to the cash flow dip that year.
Investing Activities: Investing cash flow was mostly negative, reflecting ongoing investments and acquisitions. A large cash inflow occurred in 2022 due to proceeds from the sale of Gentiva Hospice (2,701 million USD), which was absent before and after. Purchases of investment securities showed no clear trend but were consistently high, while proceeds from sales and maturities of these securities fluctuated significantly year to year. Net cash used in investing activities was highest in 2021, suggesting substantial asset purchases or investments.
Financing Activities: Financing activities showed considerable variability. Proceeds from issuing senior notes generally increased over the years, while repayments peaked in 2023. Common stock repurchases were substantial in 2020 and again in 2022 and 2023, indicating active capital return policies. Dividends paid gradually increased year over year. Net cash from financing activities swung from negative in 2019-2020, positive in 2021, back to negative in 2022-2023, reflecting shifts in borrowing, repayments, and capital distribution strategies.
Liquidity and Cash Position: Cash and cash equivalents experienced growth overall from 2,343 million USD at the end of 2019 to 4,694 million USD at the end of 2023, with a notable dip at the end of 2021. The increase in 2022 was significant, largely driven by operating cash inflows and proceeds from the Gentiva Hospice sale, partially offset by high investing and financing cash outflows. The net increase/decrease in cash fluctuated annually, highlighting varying liquidity management across the periods.

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Humana Inc. (NYSE:HUM)

Cash Flow Statement