PHARMACIST STEVE

Recently I wrote 2012 – Good year to work for CVS !

https://www.pharmaciststeve.com/?p=3567

How comes the results of the first quarter for CVS/Caremark

http://drugstorenews.com/article/year-great-start-cvs-caremark-reports-strong-q1

Year is off to a ‘great start’ as CVS Caremark reports ‘strong’ Q1

From the article:

Net revenues for the quarter decreased 0.1% to $30.76 billion, compared with the year-ago period. Income from continuing operations for the quarter rose 23.1% to $956 million during the quarter. 

“We are very pleased with the strong first-quarter results. As expected, the influx of new generic drugs was a key driver of our year-over-year profit growth across the enterprise

How does a company have DECREASE GROSS REVENUE and have NET INCOME INCREASE 23.1% ? IMO.. if a company is showing this large a increase in net profits… someone is getting HOSED !

The company seems to apparently clearly states how it does it… NEW GENERICS in which they kept the lion share of  price decrease of generic over brand name drugs… Of course, a company can also cut salaries and/or reduce the man hours in the store and/or Rx dept.

The two biggest costs between gross revenue and net income is the cost of goods and labor.. If you charge – on average – the same prices… while buying lower prices meds ( generics) and you cut man hours in the store and/or overall labor costs…  you have a unreal increase in net income..

Filed under: General Problems