WOONSOCKET, R.I. CVS Caremark on Thursday posted solid first-quarter results with double-digit gains in net revenues and earnings.
Net earnings for the quarter ended March 29 rose 83.1 percent to $748.5 million, or 51 cents per share, compared with net earnings of $408.9 million, or 43 cents per share, in the year-ago period.
Net revenues for the quarter increased $8.1 billion to $21.3 billion, up from $13.2 billion in the year-ago period. Same-store sales increased 3.9 percent. Pharmacy same-store sales increased 3.7 percent, while front-end same-store sales rose 4.3 percent. Same-store sales benefited from an earlier Easter, which shifted more holiday sales into March. The company estimates the Easter shift had a positive impact of about 115 basis points on front-end same-store sales during the quarter.
“Sales were generally in line with expectations with CVS a bit weaker and Caremark somewhat stronger,” stated Goldman Sachs analyst John Heinbockel in a research note. “On the EBIT line, we estimate merger synergies and then attempt to allocate them between CVS and Caremark, usually about 50/50. For the first quarter, we estimate net synergies (after $10 million of integration costs) of $140 million, reducing reporting EBIT amounts by $70 million each.”
As of March 29, the company operated 6,267 retail pharmacy stores, 56 specialty pharmacy stores, 19 specialty mail order pharmacies and seven mail order pharmacies in 44 states and the District of Columbia.
“I’m very pleased with our results for the quarter. We delivered strong revenue and margin growth across our business that led to earnings at the high end of our expectations. I’m most excited about the substantial progress we have made on our new integrated PBM/retail model, which is resonating strongly in the marketplace,” stated Tom Ryan, chairman, president and chief executive officer.