CVS Health – a US pharmacy chain and healthcare business – has missed expectations and been forced to lower its full-year guidance.
CVS reported a profit of $924m (£636m), or 86 cents a share for its second quarter, down from $1.27bn in the year before. Revenue rose 18 per cent to $43.7bn, below analysts’ expectations of $44.3bn.
CVS last year acquired pharmacy locations inside retailer Target’s stores for $1.9bn and spent $12.9bn for the nursing home pharmacy Omnicare. Same-store sales increased 2.1 per cent, as pharmacy volumes grew.
“I’m very pleased with our solid second quarter results across the enterprise. Operating profit in the [retail and long-term care division] was in line with expectations while operating profit in the pharmacy services segment exceeded expectations,” said chief executive Larry Merlo.
Despite its efforts to solidify its position, CVS is under pressure from mergers in the industry that threaten its market share in the retail drugstore market.
UnitedHealth Group’s OptumRx bought benefit-management company Catamaran in July 2015 while Walgreens Boots Alliance has purchased Rite Aid.