Growth in pharmacy, retail operations boosts CVS 4Q profits

February 6, 2013

 

CVS Caremark Corp. has reported fourth-quarter earnings of $1.13 billion, a 2.7% increase from last year’s same-period $1.1 billion. The company said the increase was driven by revenue growth in its pharmacy-services and retail-drugstore operations.

The company’s retail pharmacy business gained customers in 2012 as a result of the contract dispute between Walgreens and Express Scripts.

In the larger pharmacy-services segment, 4Q revenues climbed 17% to $18.6 billion, a reflection of new client starts, higher prices, and growth of the company’s Medicare Part D program. An increase of 6.5% was seen in the number of pharmacy network claims processed, from last year’s fourth-quarter 193 million claims to this year’s 205.5 million.

In the retail segment, 4Q revenues increased 5.1% to $16.3 billion. Same-store sales increased by 4% from a year earlier, and same-store sales in the front-end of the store increased by 3.9%.

During the fourth quarter, CVS opened 37 new retail drugstores, relocated eight, and closed two. As of Dec. 31, 2012, the company operated 7,525 locations in 45 states, the District of Columbia, and Puerto Rico. The locations included 7,458 retail drugstores, 19 onsite pharmacies, 31 retail specialty pharmacy stores, 12 specialty mail-order pharmacies, and five mail-order pharmacies.

Net revenues for the fourth quarter increased almost 11% to $31.4 billion, compared to $28.3 billion in the previous year. Total annual revenue increased 15%-from $107.1 billion in 2011 to a record $123.1 billion in 2012.