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  • wall_st_knight_mare wall_st_knight_mare Feb 6, 2013 9:33 AM Flag

    CVS Caremark Raises Outlook

    CVS Caremark Corp.'s CVS -0.29% fourth-quarter net profit rose 2.6% as the company reported revenue growth in its pharmacy-services and retail drugstore operations.

    For the year, the company raised its forecast for per-share adjusted earnings from continuing operations by two cents and now expects $3.86 to $4.

    CVS's retail pharmacy business gained customers last year in the wake of a contract dispute between rival Walgreen Co.'s WAG -0.92% and pharmacy-benefits manager Express Scripts Holding Co. ESRX -1.01% that has since been resolved.

    A wave of major generic drugs introductions is having a mixed effect on the industry. Though the copycat drugs carry higher margins than branded products, they command lower prices, hurting sales revenue.

    CVS Caremark reported a profit of $1.13 billion, or 90 cents a share, up from $1.1 billion, or 81 cents a share, a year earlier. Excluding debt-extinguishment losses, acquisition-related charges and other items, adjusted earnings from continuing operations were $1.14. Revenue increased 11% to $31.39 billion.

    Analysts polled by Thomson Reuters most recently projected earnings of $1.10 on revenue of $31.13 billion.

    Revenue in the larger pharmacy-services business climbed 17% to $18.6 billion, reflecting new client starts, higher prices and growth of its Medicare Part D program. Pharmacy network claims processed rose 6.5%.

    On the retail side, revenue increased 5.1% to $16.3 billion. Same-store sales were up 4% from a year earlier, as pharmacy same-store sales also improved by 4%. Same-store sales in the front end of the store grew 3.9%.

 
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