CVS Q4 Earnings, Revenues Fall Short Of Consensus
The fourth-quarter earnings of CVS Caremark Corp (NYSE: CVS) rose 10%, driven by stronger sales at its pharmacy businesses. However, CVS saw just a small rise in its front-of-the-store sales during the past three months.
CVS said that its profits for the quarter came at $1.05 billion, or $0.74 a share, up from $953 million, or $0.65 a share, a year earlier. Excluding charges and a tax benefit in the latest quarter, earnings were at $0.78 a share, from $0.70. The company recorded a 7% rise in revenues to $25.8 billion, including a 4.5% gain at the retail business. The results, however, fell short of the consensus expectations of earnings of $0.78 a share on revenues of $26.22 billion.
CVS Caremark’s pharmacy-benefits business, which has been under scrutiny since late last year when the Caremark business lost $4.8 billion in 2010 contracts, saw a 15% jump in revenues, despite a 5.6% drop in claims processed. The claims took a hit as two big health plans were terminated and there were three fewer reporting days in the period.
Although CVS had projected a decline in Caremark's operating profits by 10%-12% for the year, they expanded by 3% for the quarter on falling margins.
