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CVS Caremark Corporation
Wrien by:
Desiree Riggs
When we think of drug and convenience stores the rst store to come to mind is CVS. CVS is the
largest pharmacy company in the world that helps people with their plan to become healthy and/or stay
healthy. In the past, their focus was on lling prescriptions and having a few essentials need for the time
that doctors were not available. Since 2012 CVS as evolved to beer the people with health and
promoting all to take hold of their own health concerns at any time by introducing “Minute Clinic”.
Minute Clinic is a place you can go to get a quick health check/scan when the doctor’s o.ce are closed
or you just do not want to wait. They also have over-the-counter medicines that you can go grab for
common colds or something to help the start of sinus pressure. The best part of CVS is that they can ll
you homing needs as well if you run out of something and the grocery store is closed. They have
everything that you can get at Wal-Mart or even Giant but in smaller quantities.
CVS jumped to No. 13 on the Fortune 500, which is 5 more places, since 2013. Their sales
percentage helped the changed because Walgreens lost their bene ts manager Express Scripts that year.
This chain of e9ected made prescriptions at CVS much cheaper than most and allowed the company to
expand its own bene t aspect through growing areas with Medicare D and Managed Medicaid.
(hp://fortune.com/fortune500/2013/cvs-caremark-corporation-13/)
Now as of today CVS stock market exchange is producing at 103.86. It went up +.52(.50%). I
believe it’s because at the end of 2014, CVS announced that they will be named CVS Health and promote
a healthy lifestyle be quiBng tobacco campaign and no longer selling any form of tobacco products. They
replaced all the products with quiBng and elimination/reducing products. Let’s take a look on how these
changes impacted on their key nancial statements.
Revenues and Net Income
Last year the company ended with a net revenue total of $139,367 million with a gross pro t of
$25,367. It increased about 93% during the last two years and still managed to maintain a low cost of
revenue amount of $114 million. I was amazed on how less they spent of the operating expenses for
each year. CVS did not have a lot of expenses to show in their income statement. The only two reHected
was the operating expenses and the interest expense. These looks to be there major expenses to keep
the operations up to par. Together they total up to $17,168 million which is more than half the gross
pro t. This is how the end each year with a gain of about $4, 700 million. If I build a company I need to
talk to the CEO, Larry Merlo, and found out the secret to success.
Here is what CVS Income Statements look like over the last three years:
CONSOLIDATED STATEMENTS OF
INCOME (USD $)
12 MONTHS ENDED
IN MILLIONS, EXCEPT PER SHARE DATA,
UNLESS OTHERWISE SPECIFIED
Dec. 31,
2014
Dec. 31,
2013
Dec. 31,
2012
INCOME STATEMENT [ABSTRACT]
NET REVENUES $139,367 $126,761 $123,120
COST OF REVENUES 114,000 102,978 100,632
GROSS PROFIT 25,367 23,783 22,488
OPERATING EXPENSES 16,568 15,746 15,278
OPERATING PROFIT 8,799 8,037 7,210
INTEREST EXPENSE, NET 600 509 557
DESIREE RIGGS 2
LOSS ON EARLY EXTINGUISHMENT OF
DEBT
521 0 348
INCOME BEFORE INCOME TAX
PROVISION
7,678 7,528 6,305
INCOME TAX PROVISION 3,033 2,928 2,436
INCOME FROM CONTINUING
OPERATIONS
4,645 4,600 3,869
LOSS FROM DISCONTINUED
OPERATIONS, NET OF TAX
-1 -8 -7
NET INCOME 4,644 4,592 3,862
NET LOSS ATTRIBUTABLE TO
NONCONTROLLING INTEREST
002
NET INCOME ATTRIBUTABLE TO CVS
HEALTH
$4,644 $4,592 $3,864
BASIC EARNINGS PER SHARE:
INCOME FROM CONTINUING
OPERATIONS ATTRIBUTABLE TO CVS
CAREMARK (IN DOLLARS PER SHARE)
$3.98 $3.78 $3.05
LOSS FROM DISCONTINUED
OPERATIONS ATTRIBUTABLE TO CVS
CAREMARK (IN DOLLARS PER SHARE)
$0 ($0.01) ($0.01)
