Woonsocket-based CVS Corp., the No. 2 U.S. drugstore
chain, said third-quarter earnings rose 14 percent as the company
sold more generic drugs and general merchandise. The retailer
boosted its dividend for the first time in more than five years.
Net income climbed to $187.8 million, or 46 cents a share,
from $164.4 million, or 40 cents, a year earlier, the company said in a statement. Sales in the
quarter ended Sept. 27 rose 8.5 percent to $6.38 billion from
$5.88 billion.
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CVS benefited from higher sales of generic drugs, which
generate greater profit than name-brand medication. Sales at stores
open at least a year climbed 6.4 percent, led by an 8.5 percent gain
in pharmacy sales. Same-store sales of non-prescription goods such
as cosmetics and candy increased 1.9 percent. CVS boosted profit
margins as Chief Executive Thomas Ryan focused on reducing theft.
It was a “real impressive performance in terms of profits
and a real good job of improving sales,” said Eric Bosshard, an
analyst at FTN MidWest Research, who rates the stock “neutral”
and doesn’t own the shares. “They clearly have started to build
strong momentum within their business.”
Bloomberg News
