This excerpt taken from the CVS 8-K filed Aug 2, 2007.
REFLECT UNDERLYING STRENGTH OF COMPANY
WOONSOCKET, RHODE ISLAND, August 2, 2007CVS Caremark Corporation (NYSE: CVS), today announced record revenues and earnings for the quarter ended June 30, 2007.
Net earnings for the second quarter ended June 30, 2007, increased 114.1% to $723.6 million or $0.47 per diluted share, compared with net earnings of $337.9 million or $0.40 per diluted share in the comparable 2006 period. Net earnings for the six months ended June 30, 2007 increased 69.7% to $1,132.5 million or $0.91 per diluted share, compared with net earnings of $667.5 million or $0.78 per diluted share in the comparable 2006 period. The Company estimates merger and integration costs associated with the March 22, 2007 merger between CVS Corporation and Caremark Rx, Inc. negatively impacted diluted earnings per share by $0.01 and $0.02 for the second quarter and first six months of 2007, respectively.
Tom Ryan, President and Chief Executive Officer of CVS Caremark stated: This was an exceptionally strong quarter across our retail and pharmacy services segments. Sales growth was solid in the front store, pharmacy and PBM. Gross margin improved significantly, operating margins expanded meaningfully, and our diluted earnings per share grew 18%. At the same time, weve completed the initial merger integration activities, made sizeable progress on our cost synergy opportunities, and significantly advanced our new go-to-market strategies. Our continued strong performance in our core retail and PBM segments, coupled with these achievements related to our new business model, should pave the way for significant enterprise-wide growth in the future.
Net revenues for the second quarter ended June 30, 2007, increased $10.1 billion to $20.7 billion, up from $10.6 billion during the comparable 2006 period. Same store sales (sales from stores open more than one year) in its CVS/pharmacy division rose 5.7%, while pharmacy same store sales rose 5.7% and front-end same store sales increased 5.9% for the second quarter ended June 30, 2007. Same store sales do not include the sales results of the drugstores acquired on June 2, 2006. These acquired stores will be included in same store sales following the one-year anniversary of the acquisition, beginning in fiscal July 2007.
For the second quarter, CVS Caremark opened 37 new stores, including one specialty pharmacy store, closed 15 stores and relocated 30 others. As of June 30, 2007 the Company operated 6,177 retail pharmacy stores, 53 specialty pharmacy stores, 22 specialty mail order pharmacies and 10 mail order pharmacies in 44 states and the District of Columbia.
The Company will be holding a conference call today for the investment community at 8:30am (EDT) to discuss the quarterly results. An audio webcast of the conference call will be broadcast simultaneously
through the Investor Relations portion of the CVS website for all interested parties. To access the webcast, visit http://investor.CVS.com. This webcast will be archived and available on the web site for a one-month period following the conference call.
CVS Caremark is the largest provider of prescriptions and related healthcare services in the nation. The Company fills or manages more than 1 billion prescriptions annually. Through its unmatched breadth of service offerings, CVS Caremark is transforming the delivery of healthcare services in the U.S. The Company is uniquely positioned to effectively manage costs and improve healthcare outcomes through is approximately 6,200 CVS/pharmacy stores; its pharmacy benefit management, mail order and specialty pharmacy division, Caremark Pharmacy Services; its retail-based health clinic subsidiary, MinuteClinic; and its online pharmacy, CVS.com. General information about CVS Caremark is available through the Investor Relations portion of the Companys website, at http://investor.CVS.com, as well as through the press room portion of the Companys website, at www.cvs.com/pressroom.
This press release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially. For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company strongly recommends that you become familiar with the specific risks and uncertainties outlined under the caption Cautionary Statement Concerning Forward-Looking Statements in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2007.