CVS Caremark Corp.'s second-quarter profit rose slightly more than Wall Street expected, as profit growth at the pharmacy benefits management unit outpaced its drugstores.
The company also narrowed its 2013 earnings per share forecast on Tuesday, bringing the bottom of the range up by a penny and the top down by 4 cents, citing share repurchases largely coming in the second half of the year and its results so far.
New generic drugs weighed on sales but helped profits. Generic drugs sell for less than branded ones but are more profitable.
CVS earned $1.12 billion, or 91 cents per share, in the quarter, up from $966 million, or 75 cents per share, a year earlier.
Adjusted earnings per share from continuing operations rose to 97 cents from 81 cents. That topped analysts' average estimate of 96 cents, according to Thomson Reuters I/B/E/S.
Revenue was up 1.7 percent to $31.25 billion.
Operating profit jumped 32 percent in the pharmacy benefits management business and 9 percent in the retail business.
CVS suspended share repurchases during part of the quarter while it negotiated with the U.S. Securities and Exchange Commission over an agreement in principle. On Friday, CVS said it plans to pay a $20 million civil penalty to resolve an SEC investigation into 2009 comments and staff securities transactions and accounting for an acquisition.
The company said it has repurchased $748 million of its shares so far and still plans to buy back $4 billion in stock this year.
CVS now expects adjusted earnings of $3.90 to $3.96 per share this year, with a profit of $1 to $1.03 in the current third quarter. Analysts look for full-year profit of $3.98, with 97 cents per share this quarter.
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