A CVS pharmacy is seen in the Manhattan district of New York City, New York.
Shannon Stapleton | Reuters
CVS Health reported third-quarter revenue spiked 3.5% from expected and lifted its 2020 income guidance on Friday as plans to turn the pharmacy chain into a medical services company paid off. answer.
Offering everything from insurance to the Covid-19 trial, the healthcare company also appointed a new CEO. Karen Lynch will become the company’s CEO on February 1. She is currently the executive vice president of CVS Health and president of Aetna, the health insurance company that CVS acquired in 2018.
The company’s longtime CEO Larry Merlo will resign, but serve on the CVS board of directors.
Shares have risen more than 2% compared to pre-market trading.
Here’s how the company reported for the quarter ended September 30, compared to what analysts had expected, based on a Refinitiv survey of analysts:
- Adjusted earnings per share: $ 1.66 adjusted vs. $ 1.33 expected
- Revenue: $ 67.06 billion, vs. $ 66.66 billion expected
On an unadjusted basis, the healthcare company and drugstore chain reported net earnings for the third fiscal quarter of $ 1.22 billion, or 93 cents per share, down from 1.53 billion. USD, or 1.17 USD per share, a year earlier.
Revenue increased 3.5% to $ 67.06 billion, from $ 64.81 billion a year ago. It is also higher than the $ 66.66 billion that analysts had expected.
At the company’s drugstores, sales increase in both the pharmacy and the store front as customers buy more prescriptions, check Covid-19 and fill larger baskets than over-the-counter items .
Filled prescriptions were up 4.6% on a 30-day equivalent basis in the quarter from the previous year. Front store sales were up 2.7% in the quarter from the previous year.
CVS raised the year-round guidance for earnings per share to $ 5.60 to $ 5.70 from $ 5.16 to $ 5.29, and its 2020 adjusted earnings within the guidelines stocks from $ 7.35 to $ 7.45 from $ 7.14 to $ 7.27.
It says their cash flow throughout the year will range from $ 12.75 billion to $ 13.25 billion, higher than the previous outlook of $ 11 billion to $ 11.5 billion.
The company warns that there is still some uncertainty due to the Covid-19 pandemic.
CVS has expanded its Covid-19 trial, flu vaccination, and preparation for the pandemic coronavirus vaccine deployment. It has more than 4,000 test locations that drive through pharmacies and has performed more than 6 million tests. The company says it plans to have nearly 1,000 locations for quick inspection by the end of this year.
In mid-October, CVS and rival Walgreens announced an agreement with the government to provide coronavirus vaccines to the elderly and staff in long-term care facilities as they become available.
Since March, CVS has hired about 76,000 full-time, part-time and temporary employees. It has about 300,000 employees.
Last month, they said they plan to add more workers. It said it would immediately hire 15,000 people – mostly pharmaceutical technicians – to prepare for the expected rise of Covid-19 and flu cases this fall and winter.