As CVS works to complete its health care related acquisition of Aetna, the drug store retailer posted a strong first quarter with both earnings and sales gaining.
In the first quarter ended March 31, when front store sales made progress, CVS recorded company net income of $998 million, or 98 cents per diluted share, versus $952 million, or 92 cents per diluted share, in the year-prior period.
Adjusted net income was $1.5 billion, or $1.48 per share, versus $1.21 billion, or $1.17 per share, in the year-earlier period. Adjusted earnings per share beat a Zacks Investment Research analyst average estimate of $1.39.
Comparable sales increased 5.8% in the quarter year over year with pharmacy up 7.3% and front store, including general merchandise such as home goods, up 1.6%. Front store sales were $4.73 billion versus $4.62 billionin the period a year before.
Net revenues were $45.69 billion versus $44.51 billion in the year-previous period. Operating profit was $1.95 billion compared with $1.79 billion and adjusted operating profit was $2.08 billion compared with $2.01 billion in the fiscal 2017 period.
Larry Merlo, CVS president and CEO, said, “We generated solid results in the quarter, benefiting from higher prescription volumes within our retail pharmacy business and a lower effective income tax rate. At the same time, we continue to focus on long-term growth initiatives and to invest in process improvements and technology enhancements that will position us well to expand our reach in providing access to high-quality and more affordable care.”
Merlo added, “Looking forward, the Aetna transaction will provide us the means to further lower health care costs for consumers and payors. In March, the transaction was approved by shareholders of both companies. We are moving forward on both the regulatory and integration planning fronts in support of a close in the second half of this year and a smooth, efficient integration of operations.”