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By Sharon Terlep and Micah Maidenberg 

Walgreens Boots Alliance Inc. says money made from administering Covid-19 vaccines should begin to offset pandemic-related losses as more people get shots and the U.S. government pays a higher reimbursement rate.

The company said Wednesday it has administered more than eight million vaccines to date, including four million in March. Executives now expect the company to administer 26 million to 34 million shots during its fiscal year, which ends Aug. 31. The higher number in part led the company to lift its profit forecast.

Covid so far has hurt Walgreens more than it has helped, the company said.

Store sales are down amid pandemic-related lockdowns, prescription volumes dropped as people put off medical care, and sales of cold-and-flu products tanked as Covid precautions prevented many people from getting sick from other bugs. Meantime, the company is spending more to keep workers and customers safe and stores stocked.

The U.S. Centers for Medicare and Medicaid Services announced earlier this month that it would increase the payment rate for vaccines to $40 for each dose, up from $28 for a single dose and $45 for two doses.

The U.S. said the increase, "reflects new information about the costs involved in administering the vaccine for different types of providers and suppliers, and the additional resources necessary to ensure the vaccine is administered safely and appropriately."

It isn't clear if all insurers will match the government's $40 rate, Walgreens Finance Chief James Kehoe said, though the company's increased profit forecast is based on that reimbursement rate.

The company reported a stronger profit for its latest quarter, a performance that comes as it looks to make itself a cornerstone in the distribution of Covid-19 vaccines under new Chief Executive Rosalind Brewer.

Vaccinations have been ramping up around the country, with states expanding eligibility to more adults. Rivals including CVS Health Corp., as well as supermarket chain Kroger Co. and Walmart Inc., are also pushing to get consumers to visit their locations to receive vaccines.

"Our team will move swiftly and decisively to best serve the needs of our patients, customers and communities around the world, at this critical time and beyond," said Ms. Brewer, who took the helm at Walgreens earlier in March.

Walgreens on Wednesday reported $32.8 billion in sales from continuing operations for its quarter that ended Feb. 28, up almost 5% from the year-earlier period.

Comparable sales in the U.S. were up 2%, including a 4.5% gain in pharmacy items. Demand for other retail products was lower, amid a weaker cough, cold and flu season, the company said.

Profit rose to $1.03 billion, or $1.19 a share, from $946 million, or $1.07 a share, for the year-earlier period. After adjustments, Walgreens reported earnings of $1.40 a share, ahead of what analysts expected for that metric.

In January, the company said it had hired Ms. Brewer to serve as CEO. She took over the top role from Stefano Pessina, who now is executive chairman of its board. Ms. Brewer is a former CEO of Sam's Club and chief operating officer at Starbucks Corp.

Walgreens shares were up more than 6% in morning trading.

Write to Sharon Terlep at sharon.terlep@wsj.com and Micah Maidenberg at micah.maidenberg@wsj.com

(END) Dow Jones Newswires

March 31, 2021 11:47 ET (15:47 GMT)

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