CVS Profit Misses Estimates As Retail Sales Growth Slows
Retail pharmacy chain CVS Health Corp. missed analysts’ second-quarter earnings expectations as retail sales growth slowed.
Profit excluding one-time items was $1.19 a share, one cent below the average of analysts' estimates compiled by Bloomberg. Sales rose 7.4 per cent to $37.2 billion, the US-based company said in a statement. That was in line with analysts’ estimates.
The company also narrowed its full-year adjusted earnings forecast to $5.11-$5.18 a share from a previous forecast of $5.08-$5.19 a share. Analysts had projected $5.17 a share.
CVS, the largest provider of prescription drugs in the US, is expanding further beyond its retail roots with two second-quarter acquisitions. They are part of a record year for the health-care industry, with consolidation affecting insurers and drugmakers.
In May, CVS agreed to purchase nursing-home pharmacy Omnicare for $12.7 billion, expanding services to the country’s elderly. Less than four weeks later, CVS struck a deal to acquire Target's pharmacies and clinics for $1.9 billion, putting its brand, which includes OneMinute Clinics, in retail locations across 47 states.
Pharmacy services' revenue rose 12 per cent in the second quarter to $24.4 billion, the company said.
Front-of-store sales for locations that have been open at least a year dropped 7.8 per cent, reflecting the company’s decision to stop selling tobacco products.
News by Bloomberg, edited by ESM. To subscribe to ESM: The European Supermarket Magazine, click here.