By Tess Stynes
Express Scripts Holding Co. said second-quarter earnings fell
5.1% on higher expenses related to acqusitions and transactions,
other one-time items and a revenue decline.
The company's share price rose 1.1% to $68 in recent after-hours
trading, as adjusted earnings topped the midpoint of the company's
guidance. The pharmacy-benefits manager also projected
third-quarter earnings mostly above analysts' expectations.
For the current quarter, the company forecast per-share earnings
of $1.27-$1.31. Analysts polled by Thomson Reuters have expected
$1.28. For the year, Express Scripts narrowed its per-share
earnings estimate to $4.84-$4.92 from its previously lowered
estimate of $4.82-$4.94.
Express Scripts also said integration of its April 2012
acquisition of Medco Health Solutions "resulted in isolated
challenges for some clients."
The St. Louis-based company, which manages drug-benefit programs
for health plans and corporate customers, said "certain
account-management teams experienced turnover; often these
relationships are key to retaining clients."
Citing market dynamics, Express Scripts expects its retention
rate to be 92%-93% next year, contributing to an expected decline
in claims volume of 1.5%.
Express Scripts reported a second-quarter profit of $515.2
million, down from $543 million a year earlier. Per-share, earnings
increased to 67 cents from 66 cents, amid fewer shares outstanding.
Excluding acquisition and integration-related costs, accounting
adjustments and other items, adjusted earnings from continuing
operations rose to $1.23 from $1.12. The company had projected
$1.20-$1.24. Revenue decreased 4.8% to $25.11 billion.
Express Scripts reported adjusted claims--a measure that takes
into account monthly prescriptions filled in retail pharmacies and
90-day fills through the company's mail-order business--fell 12% to
$324.5 million. Excluding impacts from the roll-off of UnitedHealth
Group Inc. (UNH) claims, the decline was 5%.
Write to Tess Stynes at tess.stynes@wsj.com
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