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CVS quarterly profit jumps 25 percent

Drugstore chain CVS Corp. says quarterly profit leaped 25 percent on brisk generic drug sales, lower inventory losses and a more profitable mix of promotional products.
/ Source: Reuters

Drugstore chain CVS Corp. on Wednesday said quarterly profit leaped 25 percent on brisk generic drug sales, lower inventory losses and a more profitable mix of promotional products.

CVS, whose planned acquisition of the Eckerd chain from J.C. Penney Co. Inc. would make it the biggest U.S. pharmacy chain by number of stores, said it earned $244.6 million, or 59 cents per share, in the first quarter, compared with $196.3 million, or 48 cents a share, a year earlier.

Analysts’ average earnings estimate was 56 cents per share, according to Reuters Research, a unit of Reuters Group Plc.

Sales at stores open at least a year climbed 6.4 percent, driven by an 8.3 percent increase in pharmacy same-store sales. Front-end, or non-prescription, same-store sales edged up 2 percent.

Net sales rose 8 percent from a year earlier, to $6.82 billion.

On April 5, CVS, which now runs about 4,200 stores, announced it would acquire 1,260 Eckerd drugstores, located mainly in the U.S. South, as well as Eckerd’s mail order and pharmacy benefit management businesses.