WOONSOCKET – CVS Caremark Corp., the largest U.S. provider of prescription drugs, said free cash flow may double to $5 billion by 2015.
The drugstore chain will also boost its dividend payout rate to 25 percent to 30 percent by 2015, Chief Financial Officer David Denton said during a conference call late Friday afternoon. The ratio was about 12 percent for 2009, according to data compiled by Bloomberg.
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CVS cut its annual profit forecast by about 9 cents share in July, as some consumers deferred medical treatment and the company’s legal expenses rose. CVS faces investigations from more than 24 states and the U.S. Federal Trade Commission over business practices following its $27 billion acquisition of Caremark Rx Inc. in 2007.
While CVS may buy more companies, “the day of big acquisitions is over,” Denton told investors on the call Friday.
The company plans to cut an additional $1 billion in inventory by 2013, executives said. They affirmed the July forecast for full-year profit of at least $2.68 a share, excluding some items. Cash flow is projected to be $2.5 billion this year.
