Pharmacy chain Jean Coutu Group has reported improved results in its fiscal fourth quarter that beat analyst estimates on both profit and revenue.
The Montreal-based company attributed the improvement to an additional week in the latest period – 14 weeks versus 13 in the 2011 quarter – as well as strong operational performance and the reversal of $8.1-million of tax.
Jean Coutu said net earnings in the period ended March 3 were $62-million or 28 cents per share, compared with $46.5-million or 20 cents in the same 2011 period.
Revenue was $737.2-million, up from $659.8-million.
The average estimate of analysts polled by Thomson Reuters had been for earnings of 24 cents per share on $673-million of revenue.
For the full year (53 weeks), the company earned $230-million or $1.03 per share on revenue of $2.73-billion, up from $182.6-million or 78 cents per share on revenue of $2.61-billion. That also beat estimates of 88 cents per share on $2.7-billion of revenues.
Quebec's largest pharmacy retailer recently sold 56 million of its 234.4 million shares in Rite Aid Corp. for total proceeds of US$83.6-million.
The sale reduced its stake in the U.S. drug store chain to 19.85 per cent, leaving it with two members on Rite Aid's board of directors.
The company had previously written off its investment in Rite Aid, which it acquired in 2007 in exchange for its chain of 1,854 Brooks and Eckerd drugstores and six distribution centres.
Like other pharmacy chains, Jean Coutu has been hit by new government rules in Ontario and Quebec that lowered prescription drug price.
Sales of its generic drug company, Pro Doc, continue to increase as new molecules are added, but at a slower pace than before the introduction of generic drug reform.
Company president and CEO François Coutu said the results for both the quarter and the year "speak for the excellent performance of our organization."
"We have successfully continued the implementation of our business plan, allowing us to post a significant growth of the net profit despite the price reduction of generic drugs," he said.
"Over the coming year, we will spare no effort to pursue our growth. We will continue to ensure the development of our offer and we will implement effective marketing strategies in order to contribute to an increase of the retail sales of the PJC network."
The Jean Coutu Group employs nearly 19,000 people and operates a network of nearly 400 franchised stores in Quebec, New Brunswick and Ontario under the banners of PJC Jean Coutu, PJC Clinique, PJC Sante and PJC Sante Beaute.