CVS Pharmacy will hold its second annual Supplier Diversity & Minority Owned Summit April 5-8, in partnership with ECRM and RangeMe.
For its fourth-quarter results ended Dec. 31, 2021, CVS Health Corp. reported that its total revenues increased to $76.6 billion, up 10.1% from the prior year, driven by growth across all segments. Operating income declined 11.7%, however, primarily because of a Q4 store impairment charge of about $1.4 billion related to the write-down of operating lease right-of-use assets and property and equipment in connection with planned retail store closures over the next three years, as well as the absence of pre-tax income of $307 million.
Adjusted operating income increased 40.8%, mainly due to higher prescription and front-store volume and the administration of COVID-19 vaccinations in the company’s retail/long-term care (LTC) segment, improved purchasing economics, and growth in specialty pharmacy in the pharmacy services segment, as well as gains from antitrust legal settlements. This increase was also driven by lower COVID-19-related investments versus the prior year in the health care benefits segment.
GAAP diluted earnings per share (EPS) from continuing operations were 98 cents for the quarter, and adjusted EPS was $1.98.
For the year ended Dec. 31, 2021, total revenues grew 8.7% from the prior year to $292.1 billion, while operating income dropped 5.2%, for the reasons given above, along with a $431 million goodwill impairment charge associated with the LTC business during third quarter of 2021. The operating income decreases for both fourth quarter and the year were partly offset by increases in adjusted operating income and lower acquisition-related integration costs compared with the prior year.
Adjusted operating income for the year rose 8.1% for the same reasons given for the Q4 adjusted operating income increase. This increase was also spurred by the administration of COVID-19 diagnostic testing in the retail/LTC segment, but partly offset by higher COVID-19-related costs in the health care benefits segment, including the effect of the deferral of elective procedures and other discretionary use in response to the COVID-19 pandemic during the year ended Dec. 31, 2020.
GAAP diluted EPS from continuing operations was $5.95 for the year, and adjusted EPS was $8.40.
Additionally, for the year ended Dec. 31, 2021, generated cash flow from operations came to $18.3 billion and there were net repayments of long-term debt of $8.8 billion.
“We’re engaging millions of customers across our businesses and in our community health destinations, becoming an even bigger part of their everyday health,” noted Karen S. Lynch, CVS Health president and CEO. "That’s clearly reflected in our performance, but more importantly in our potential.”
CVS gave full-year 2022 guidance of $7.04 to $7.24 for confirmed GAAP diluted EPS from continuing operations, $8.10 to $8.30 for confirmed adjusted EPS, and $12.0 billion to $13.0 billion for revised cash flow from operations, from $12.5 billion to $13.0 billion.
In other company news, CVS Pharmacy revealed that it would hold its second annual Supplier Diversity & Minority Owned Summit April 5-8, in partnership with ECRM and RangeMe. The virtual event is part of CVS Pharmacy’s continuing efforts to bring a wider assortment of products from diverse suppliers and brands to customers, and work with those suppliers and brands to ensure mutual success via customized support and resources. CVS’ 2022 summit will focus on products across the beauty, grocery, personal care, health, wellness, household and general merchandise categories. Vendors can find out more and apply to join the event by visiting www.rangeme.com/cvsdiversity through Feb. 14.
The company has introduced new tools and processes to ensure higher diverse spend and a more inclusive supplier and product landscape, among them:
- CVS Merchandising, in partnership with the CVS Health Enterprise Procurement Supplier Diversity team, has held a Supplier Diversity in Merchandising program annually for the past four years to identify new diverse suppliers and help eliminate barriers to starting in retail.
- CVS Health’s Supplier Diversity program hosts an annual Executive Learning Series, which trains attendees in pitching products and securing their expanded retail distribution, including the opportunity to take part in individualized executive coaching.
- CVS Pharmacy merchandisers go to supplier diversity advocacy conferences, such as National Minority Supplier Development Council and Women’s Business Enterprise National Council, to meet with diverse suppliers.
- CVS Pharmacy strives to reinforce the diversity of both product assortment and suppliers throughout its planogram process to deliver relevant offerings to the communities it serves.
CVS Pharmacy currently offers 100-plus diverse-owned brands across front store categories and is committed to increasing its selection with enhanced merchandising protocols for diverse suppliers.
With its CVS Pharmacy subsidiary operating almost 10,000 locations nationwide, Woonsocket, R.I.-based CVS Health is No. 7 on The PG 100, Progressive Grocer’s 2021 list of the top food and consumables retailers in North America.