For the three months ended March 31, CVS Caremark Corp. posted a 23.1% gain in income from continuing operations to $956 million. Adjusted earnings per share were 83 cents versus 65 cents in the first quarter of 2012, an increase of 28.1%.
A consensus analyst estimate compiled by Thomson Reuters called for adjusted earnings per share of 79 cents.
Adjusted earnings exclude $122 million and $118 million of intangible asset amortization related to acquisition activity in the 2013 and 2012 first quarters, respectively. GAAP earnings per diluted share from continuing operations were 77 cents and 59 cents, respectively.
The increase in income from continuing operations was primarily driven by the positive impact of new generics in pharmacy operations, the company noted.
First quarter net revenues decreased 0.1% versus the year-prior period to $30.76 billion.
Retail pharmacy segment comparable store sales decreased 1.2% versus the 2012 quarter, with pharmacy comps down 2.3% and front end comps up 1.4%. Front end sales cover general merchandise including home furnishings and housewares. Division net revenue gained 0.2% in the quarter versus the prior year period.
A 65 basis points gain attributable to the earlier Easter holiday boosted front end comps, CVS asserted.
“As expected, the influx of new generic drugs was a key driver across the enterprise, resulting in solid gross margin expansion as well as significant growth in operating profit and earnings,” said CVS president and CEO, Larry Merlo. “In fact, operating profit grew well beyond our expectations across the enterprise, and we delivered EPS that was three cents above the high end of our guidance. This out-performance was driven by stronger-than-expected prescription volumes due in large part to the strong flu season, strong specialty growth and favorable purchasing and rebate economics.”