CVS sees profit, revenue growth

CVS Caremark reported fourth quarter and full-year results Wednesday, posting increases in net income and revenue.
Posted 2/8/12

WOONSOCKET – CVS Caremark Corp. reported fourth quarter and full-year results Wednesday, posting increases in net income and revenue.

“Our retail business continues to execute successfully, while our [pharmacy benefits manager] is poised to return to healthy operating profit growth in 2012. Our substantial cash generation capabilities should enable us to continue to drive shareholder value now and in the years ahead,” said President and CEO Larry Merlo.

For the fourth quarter, net income for the company was $1.06 billion, compared with the same quarter a year earlier when it was $1.03 billion. Revenue was $28.32 billion, compared with $24.59 billion.

For the year ended Dec. 31, the company reported net income was $3.46 billion, up from $3.42 billion. Revenue increased 11.8 percent to $107.1 billion.

Earnings per diluted share of net attributable income were 81 cents in the fourth quarter, up from 75 cents a year earlier; for the full year it was $2.57, compared with $2.49.

The company noted the sale of its TeraCom LLC subsidiary to Amerisource Bergen Corp. for $250 million on Nov. 1 and recognized a $53 million pre-tax gain and a $37 million after-tax loss on the sale.

CVS also said that its losses from discontinued operations included costs related to guarantees on its store lease obligations from former subsidiary Linens ‘n Things, which filed for bankruptcy in 2008.

Revenue in the pharmacy services segment surged 24.9 percent to $58.9 billion in 2011 form a year earlier. In the retail pharmacy segment, it advanced 3.9 percent to $59.6 billion. Same-store sales increased 2.3 percent year over year.

In the fourth quarter, the pharmacy services segment saw revenue jump 32.4 percent, which CVS attributed to a long-term contract with Aetna Inc. as well as the new activity resulting from the Medicare prescription drug business of Universal American Corp. in the second quarter.

CVS raised its earnings guidance by 3 cents a share for the first quarter to , anticipating a benefit from the impasse between Walgreens and Express Scripts.

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