CVS Caremark Profit Climbs; Boosts Full-Year Outlook
CVS Caremark posted higher quarterly earnings on Tuesday and raised its guidance for the full year, citing higher drugstore chain sales and an increase in pharmacy benefit clients.
CVS, the No. 2 U.S. drugstore chain, reported third-quarter earning of $1.01 billion, or 79 cents a share, up from $868 million, or 65 cents a share, in year-earlier period.
On an adjusted basis, which excludes intangible asset amortization related to acquisitions, CVS earned 85 cents per share. That topped analysts' expectations of 84 cents per share, according to Thomson Reuters I/B/E/S, and was ahead of the company's forecast of 81 cents to 83 cents per share.
CVS said it now expects to post adjusted earnings per share of $3.38 to $3.41 in 2012, up from its prior guidance of $3.32 to $3.38.
Revenue rose 13.3 percent to $30.23 billion, ahead of analysts' average forecast of $30.09 billion.
Revenue in the pharmacy services business jumped 22.2 percent to $18.1 billion, led by the addition of new clients, higher drug costs and the growth of its Medicare Part D program.
Revenue at the CVS drugstore chain rose 5.5 percent to $15.5 billion. Sales at stores open a least a year rose 4.3 percent, topping the company's August forecast of a 2.5 percent to 3.5 percent increase in same-store sales.
During the quarter, CVS's same-store sales at the pharmacy counter rose 5.3 percent, helped by Walgreen not being part of the Express Scripts pharmacy network for the bulk of the quarter. Walgreen did not fill Express Scripts prescriptions from the beginning of the year until mid-September.
CVS has increased its marketing to hold onto new customers who started shopping its stores during the earlier part of 2012.
Shares of CVS traded higher in pre-market trading prior to the opening bell. (Click here to get real-time quotes for CVS.)
—Reuters contributed to this report.