CVS Reports Higher Revenue, Profit

By Aisha Al-Muslim 

CVS Health Corp. reported higher revenue in the latest quarter as the retail pharmacy chain grew its network and got a boost from an increase in same-store prescription volumes.

The Woonsocket, R.I.-based company's third-quarter revenue rose 2.4% to $47.3 billion, beating the $47.2 billion analysts polled by Refinitiv were expecting.

Same-store sales grew 6.7%, beating the FactSet estimate of a 5.4% increase. Pharmacy same-store sales increased 8.7% and same-store prescription volume grew 9.2%.

The company posted a profit of $1.39 billion, or $1.36 a share, up from $1.29 billion, or $1.26 a share, a year earlier. Excluding one-time items, adjusted earnings were $1.73 a share, ahead of the consensus forecast of $1.71 a share.

For 2018, CVS reaffirmed its guidance for adjusted earnings per share of $6.98 to $7.08.

Shares, which are up 10.3% in the past 12 months, rose 2.6% to $75.58 in premarket trading Tuesday.

Last month, the Justice Department antitrust enforcers cleared CVS's acquisition of Aetna Inc. after the companies took steps to ease regulators' concerns, moving the nearly $70 billion deal a step closer. CVS recorded $208 million in costs in the latest quarter in connection with the Aetna deal.

The Justice Department had said that Aetna's announcement in late September that it planned the divestitur e of its Medicare drug business to WellCare Health Plans Inc. "would fully resolve the Department's competition concerns."

The CVS-Aetna merger -- which brings together the giant drugstore chain and pharmacy-benefit manager with the No. 3 health insurer -- needs the approval from five more states to complete the deal. So far, CVS said it has received approval from 23 of the 28 states needed. The transaction is expected to close before Thanksgiving.

"We are well down the line with the remaining five" states, the company said Tuesday.

CVS and Aetna operate in largely different businesses, with their most direct overlap coming in selling plans under the Medicare prescription-drug program, known as Part D.

Write to Aisha Al-Muslim at [e-mail]

(END) Dow Jones Newswires

November 06, 2018 07:53 ET (12:53 GMT)

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