Triple-S Management Corporation
	1441 F.D. Roosevelt Ave.
	San Juan, PR 00920
	www.triplesmanagement.com
FOR FURTHER INFORMATION:
AT THE COMPANY:	INVESTOR RELATIONS:
Juan José Román-Jiménez	Mr. Garrett Edson
EVP and Chief Financial Officer	ICR
(787) 749-4949	(787) 792-6488

•

Net income of $43.6 million, or $1.87 per diluted share, versus net income of $30.9 million, or $1.35 per diluted share, in the prior-year period;

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Adjusted net income of $40.9 million, or $1.76 per diluted share, versus adjusted net income of $25.6 million, or $1.12 per diluted share, in the prior-year period;

•

Operating revenues of $875.5 million, a 0.4% decrease from the prior-year period, primarily reflecting lower Managed Care net premiums earned;

•

Consolidated loss ratio of 76.1%, a 610 basis-point decline from the second quarter of 2019, reflecting lower Managed Care utilization of services during the quarter as the result of the government-enforced lockdown related to the COVID-19 pandemic;

•

Medical loss ratio (“MLR”) declined 510 basis points to 79.4%;

•

Consolidated operating income was $43.7 million, compared to consolidated operating income of $38.2 million in the prior-year period;

•

During the second quarter of 2020, the Company repurchased 375,373 shares at an aggregate cost of approximately $6.0 million, completing its share repurchase program.

•	Consolidated net premiums earned were $858.5 million, down 0.1% from the prior-year period, primarily reflecting lower Managed Care premiums.

•	Consolidated claims incurred were $653.1 million, down 7.5% year-over-year. Consolidated loss ratio was 76.1%, 610 basis points lower than the prior-year period, mostly reflecting a decline in Managed Care utilization of services during the quarter as the result of the government-enforced lockdown.

•

Consolidated operating expenses of $178.7 million increased by $44.6 million, or 33.3%, from the prior-year period, primarily reflecting an accrual of a potential litigation loss in the Company’s Managed Care segment and the reinstatement of the HIP fee in 2020.  The consolidated operating expense ratio was 20.7%, a 510 basis point increase from the prior-year quarter.

•	Managed Care premiums earned were $789.3 million, down 0.6% year-over-year.

o

Medicare premiums earned of $372.4 million increased 1.7% from the prior-year period, largely due to an increase of approximately 19,000 member months, which primarily reflects a more competitive product offering, and an increase in the average membership risk score.  This increase in premiums earned was partially offset by the recognition of estimated premium rebates due to the lower MLR resulting from the decreased utilization of services following the pandemic-related lock-down.

o

Commercial premiums earned of $195.8 million decreased 2.5% from the prior-year period, mainly reflecting lower average premium rates and the recognition of estimated premium rebates due to the decreased utilization of services following the lock-down.  These decreases were partially offset by an increase in fully-insured enrollment during the quarter of approximately 20,000 member months and the reinstatement of the HIP Fee pass-through in 2020.

o

Medicaid premiums earned of $221.1 million decreased 2.6% from the prior-year period, primarily reflecting lower membership of approximately 15,000 member months. In addition, the 2019 quarter included retroactive premiums related to adjustments to the premium rates for high-cost high-need members as part of an ongoing reconciliation with ASES.

•	Reported MLR of 79.4% improved 510 basis points from the prior-year period, primarily reflecting lower utilization of services during the quarter as the result of the lockdown.

•

Triple-S Propiedad, Inc. (TSP), the Company’s P&C subsidiary, has paid a cumulative amount of $757 million in claims and expenses related to Hurricane María.  Estimated gross losses remain unchanged at $967 million.

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TSP received 3 new claims and closed 150 claims during the second quarter of 2020.  505 claims remain open.

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The Company has been served with process with respect to 341 of the 505 claims that remain open.

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As is the case for all claim liabilities, the gross losses related to Hurricane Maria are based on the Company’s best estimate of the ultimate expected cost of claims with the information currently on hand and are subject to change.

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Trends in health care costs and utilization rates

•

Ability to secure sufficient premium rate increases

•

Competitor pricing below market trends of increasing costs

•

Re-estimates of policy and contract liabilities

•

Changes in government laws and regulations of managed care, life insurance or property and casualty insurance

•

Significant acquisitions or divestitures by major competitors

•

Introduction and use of new prescription drugs and technologies

•

A downgrade in the Company’s financial strength ratings

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Litigation or legislation targeted at managed care, life insurance or property and casualty insurance companies

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Ability to contract with providers consistent with past practice

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Ability to successfully implement the Company’s disease management, utilization management and Star ratings programs

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Ability to maintain Federal Employees, Medicare and Medicaid contracts

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Volatility in the securities markets and investment losses and defaults

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General economic downturns, major disasters, and epidemics

Earnings Release Schedules and Supplemental Information
Condensed Consolidated Balance Sheets	Exhibit I
Condensed Consolidated Statements of Earnings	Exhibit II
Condensed Consolidated Statements of Cash Flows	Exhibit III
Segment Performance Supplemental Information	Exhibit IV
Reconciliation of Non-GAAP Financial Measures	Exhibit V

		June 30, 2020				December 31, 2019
Assets
Investments		$	1,755,698			$	1,643,637
Cash and cash equivalents			141,071				109,837
Premium and other receivables, net			547,209				567,692
Deferred policy acquisition costs and value of business acquired			238,636				234,885
Property and equipment, net			126,685				88,588
Other assets			212,131				174,187
Total assets		$	3,021,430			$	2,818,826
Liabilities and Stockholders’ Equity
Policy liabilities and accruals		$	1,470,558			$	1,425,477
Accounts payable and accrued liabilities			501,397				370,483
Short-term borrowings			15,000				54,000
Long-term borrowings			54,940				25,694
Total liabilities			2,041,895				1,875,654
Stockholders’ equity:
Common stock			23,438				23,800
Other stockholders’ equity			956,807				920,065
Total Triple-S Management Corporation stockholders’ equity			980,245				943,865
Non-controlling interest in consolidated subsidiary			(710	)			(693	)
Total stockholders’ equity			979,535				943,172
Total liabilities and stockholders’ equity		$	3,021,430			$	2,818,826

		For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2020				2019				2020				2019
Revenues:
Premiums earned, net		$	858,535			$	859,493			$	1,734,432			$	1,627,495
Administrative service fees			2,809				2,456				5,003				5,088
Net investment income			13,815				15,062				28,126				30,438
Other operating revenues			303				1,591				4,342				3,168
Total operating revenues			875,462				878,602				1,771,903				1,666,189
Net realized investment (losses) gains			(221	)			2,364				(687	)			3,679
Net unrealized investment gains (losses) on equity investments			28,338				3,323				(28,468	)			22,992
Other income, net			801				1,705				4,406				2,874
Total revenues			904,380				885,994				1,747,154				1,695,734
Benefits and expenses:
Claims incurred			653,087				706,304				1,367,609				1,329,494
Operating expenses			178,659				134,084				340,860				266,747
Total operating costs			831,746				840,388				1,708,469				1,596,241
Interest expense			1,864				1,831				3,717				3,619
Total benefits and expenses			833,610				842,219				1,712,186				1,599,860
Income before taxes			70,770				43,775				34,968				95,874
Income tax expense			27,181				12,849				17,531				30,165
Net income			43,589				30,926				17,437				65,709
Net loss attributable to the non-controlling interest			(10	)			(5	)			(17	)			(8	)
Net income attributable to Triple-S Management Corporation		$	43,599			$	30,931			$	17,454			$	65,717
Earnings per share attributable to Triple-S Management Corporation:
Basic net income per share		$	1.88			$	1.35			$	0.75			$	2.88
Diluted net income per share		$	1.87			$	1.35			$	0.75			$	2.87
Weighted average of common shares			23,193,626				22,830,399				23,287,787				22,794,297
Diluted weighted average of common shares			23,271,303				22,895,000				23,372,985				22,866,691

		For the Six Months Ended June 30,
		2020				2019
Net cash provided by operating activities		$	170,282			$	26,305
Cash flows from investing activities:
Proceeds from investments sold or matured:
Securities available for sale:
Fixed maturities sold			66,316				315,495
Fixed maturities matured/called			18,752				14,420
Securities held to maturity - fixed maturities matured/called			339				1,178
Equity investments sold			72,775				70,054
Other invested assets sold			11,814				2,096
Acquisition of investments:
Securities available for sale - fixed maturities			(91,930	)			(291,533	)
Securities held to maturity - fixed maturities			(340	)			(539	)
Equity investments			(160,104	)			(67,560	)
Other invested assets			(20,799	)			(15,424	)
Increase in other investments			(2,400	)			(2,692	)
Net change in policy loans			(97	)			(771	)
Net capital expenditures			(45,927	)			(10,659	)
Capital contribution on equity method investees			(4,933	)			-
Net cash (used in) provided by investing activities			(156,534	)			14,065
Cash flows from financing activities:
Change in outstanding checks in excess of bank balances			34,024				13,189
Repayments of short-term borrowings			(39,000	)			-
Proceeds from long-term borrowings			30,841				-
Repayments of long-term borrowings			(1,618	)			(1,613	)
Repurchase and retirement of common stock			(14,982	)			(1	)
Proceeds from policyholder deposits			16,421				8,204
Surrender of policyholder deposits			(8,200	)			(11,421	)
Net cash provided by financing activities			17,486				8,358
Net increase in cash and cash equivalents			31,234				48,728
Cash and cash equivalents, beginning of period			109,837				117,544
Cash and cash equivalents, end of period		$	141,071			$	166,272

(Unaudited)		Three months ended June 30,												Six months ended June 30,
(dollar amounts in millions)		2020				2019				Percentage Change				2020				2019				Percentage Change
Premiums earned, net:
Managed Care:
Commercial		$	195.8			$	200.8				(2.5	%)		$	396.9			$	399.3				(0.6	%)
Medicare			372.4				366.0				1.7	%			760.2				698.6				8.8	%
Medicaid			221.1				227.0				(2.6	%)			442.0				401.4				10.1	%
Total Managed Care			789.3				793.8				(0.6	%)			1,599.1				1,499.3				6.7	%
Life Insurance			48.1				45.0				6.9	%			94.8				89.2				6.3	%
Property and Casualty			22.4				21.8				2.8	%			43.0				41.1				4.6	%
Other			(1.3	)			(1.1	)			(18.2	%)			(2.5	)			(2.1	)			(19.0	%)
Consolidated premiums earned, net		$	858.5			$	859.5				(0.1	%)		$	1,734.4			$	1,627.5				6.6	%
Operating revenues (losses): 1
Managed Care		$	797.4			$	802.9				(0.7	%)		$	1,615.5			$	1,518.0				6.4	%
Life Insurance			54.9				51.8				6.0	%			108.5				102.6				5.8	%
Property and Casualty			24.7				24.1				2.5	%			47.4				46.0				3.0	%
Other			(1.5	)			(0.2	)			(650.0	%)			0.5				(0.4	)			225.0	%
Consolidated operating revenues		$	875.5			$	878.6				(0.4	%)		$	1,771.9			$	1,666.2				6.3	%
Operating income (loss): 2
Managed Care		$	29.3			$	29.3				0.0	%		$	43.5			$	51.4				(15.4	%)
Life Insurance			9.5				5.2				82.7	%			14.5				10.9				33.0	%
Property and Casualty			6.7				4.8				39.6	%			6.5				8.3				(21.7	%)
Other			(1.8	)			(1.1	)			(63.6	%)			(1.1	)			(0.6	)			(83.3	%)
Consolidated operating income		$	43.7			$	38.2				14.4	%		$	63.4			$	70.0				(9.4	%)
Operating margin: 3
Managed Care			3.7	%			3.6	%			10	bp			2.7	%			3.4	%			-70	bp
Life Insurance			17.3	%			10.0	%			730	bp			13.4	%			10.6	%			280	bp
Property and Casualty			27.1	%			19.9	%			720	bp			13.7	%			18.0	%			-430	bp
Consolidated			5.0	%			4.3	%			70	bp			3.6	%			4.2	%			-60	bp
Depreciation and amortization expense		$	3.8			$	3.5				8.6	%		$	7.7			$	7.0				10.0	%

		Three months ended June 30,								Six months ended June 30,
(Unaudited)		2020				2019				2020				2019
Member months enrollment:
Commercial:
Fully-insured			975,212				955,463				1,953,554				1,908,515
Self-insured			327,030				353,961				657,262				716,451
Total Commercial			1,302,242				1,309,424				2,610,816				2,624,966
Medicare Advantage			405,203				385,835				813,110				769,443
Medicaid			1,077,456				1,092,132				2,145,472				2,121,868
Total member months			2,784,901				2,787,391				5,569,398				5,516,277
Claim liabilities (in millions)										$	349.1			$	423.1
Days claim payable											49				61
Premium PMPM:
Managed Care		$	321.13			$	326.21			$	325.54			$	312.37
Commercial			200.78				210.16				203.17				209.22
Medicare Advantage			919.05				948.59				934.93				907.93
Medicaid			205.21				207.85				206.02				189.17
Medical loss ratio:			79.4	%			84.5	%			81.6	%			84.1	%
Commercial			67.5	%			80.9	%			73.0	%			81.9	%
Medicare Advantage			77.2	%			82.4	%			80.0	%			81.5	%
Medicaid			93.7	%			91.1	%			92.0	%			90.7	%
Adjusted medical loss ratio: 1			76.9	%			85.7	%			80.5	%			85.5	%
Commercial			67.5	%			83.6	%			72.8	%			83.4	%
Medicare Advantage			74.6	%			82.9	%			78.1	%			81.3	%
Medicaid			89.3	%			92.2	%			92.0	%			94.2	%
Operating expense ratio:
Consolidated			20.7	%			15.6	%			19.6	%			16.3	%
Managed Care			17.8	%			12.9	%			16.6	%			13.7	%

		As of June 30,
		2020				2019
Members:
Commercial:
Fully-insured			324,489				318,429
Self-insured			108,982				117,978
Total Commercial			433,471				436,407
Medicare Advantage			134,601				128,670
Medicaid			364,157				364,495
Total members			932,229				929,572

		Adjusted Net Income
(Unaudited)		Three months ended June 30,								Six months ended June 30,
(dollar amounts in millions)		2020				2019				2020				2019
Net income		$	43.6			$	30.9			$	17.4			$	65.7
Less adjustments:
Net realized investment (losses) gains, net of tax			(0.2	)			1.9				(0.6	)			2.9
Unrealized gains (losses) on equity investments			22.7				2.7				(22.8	)			18.4
Contingency accrual			(20.0	)			-				(20.0	)			-
Private equity investment income, net of tax			0.2				0.7				2.3				1.0
Adjusted net income		$	40.9			$	25.6			$	58.5			$	43.4
Diluted adjusted net income per share		$	1.76			$	1.12			$	2.50			$	1.90