Shoppers Drug Mart reports lower quarterly net income

TORONTO Tue Nov 12, 2013 9:14am EST

TORONTO Nov 12 (Reuters) - Shoppers Drug Mart Corp, Canada's largest pharmacy chain, on Tuesday reported slightly lower quarterly net income due in part to charges from its pending acquisition by Loblaw Co Ltd.

The company said third-quarter net income fell to C$165.8 million ($158.33 million), or 83 Canadian cents per share, from C$167.7 million, or 81 Canadian cents per share, a year earlier, when there was more outstanding stock.

Excluding special items, earnings per share were 88 Canadian cents, up from 85 Canadian cents a year earlier.

Analysts on average expected earnings of 81 Canadian cents per share, according to Thomson Reuters I/B/E/S.

Sales rose 2.4 percent to C$3.29 billion, meeting analysts' estimates. Sales at established stores, a key measure for retailers, were 2.2 percent higher.

But the average prescription value declined a further 2.7 percent during the quarter. Pharmacies have been hit by ongoing regulation changes in Canada that put a cap on generic drug prices.

Results also included C$14 million in costs from the Loblaw deal.

In September, shareholders voted overwhelmingly in favor of the C$12.4 billion sale to Canada's largest food retailer. The transaction will probably be finalized before the end of the first quarter after Canadian competition regulators give their approval.