Drugstore chain, CVS Caremark Corporation (NYSE: CVS) announced better-than-expected fiscal third-quarter earnings as revenue was boosted by higher sales and a rise in pharmacy benefit clients.
For the quarter, the company reported net profit of $1.01 billion or 79 cents a share compared to net earnings of $ 868 million or 65 cents a share, in the year earlier quarter.
On adjusted basis, (earnings calculated without taking into the effect of amortization charges related to acquisition ), the company posted earnings of 85 cents a share, beating analysts’ consensual estimate of 84 cents a share. The results also beat company’s own initial forecast of 81 cents to 83 cents.
For the fiscal 2012, the drug store chain has now upwardly revised its adjusted EPS to $3.38 to $3.41 from initial guidance of $3.32 to $3.38.
Revenue for the period leaped 13.3 percent to $30.23 billion even as analysts’ polled by Thomson Reuters had forecasted it at $30.09 billion.
Among company’s revenue segments, income from pharmacy services business soared 22.2 percent to $18.1 billion since it was able to add more clients while higher drug costs and growth in its Medicare Part D Program also bolstered the top-line.
Revenue from at CVS drug store rose 5.5% to $15.5 billion. Same-store-sales increased by 4.3%, beating Company’s own forecast of 2.5 % to 3.5 %, made in August.
In order to ward-off competition and retain customers who switched to its stores during a standoff between its rival Walgreen and pharmacy-benefit manager, Express Scripts Holding during first nine months of the year, CVS is putting some concerted efforts on marketing.
Walgreen did not fill Express Scripts prescriptions from the beginning of the year until mid-September as the contract had expired in 2011. However, the two companies resumed working together from Sept. 15. CVS said that it will make an effort to retain at least 60 percent of the prescriptions gained during the standoff between Walgreen and Express Scripts Holdings.
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