Excluding a one-time charge, Medco posted a profit of 56 cents per share. Thomson Financial says analysts expected a profit of 54 cents per share on $12.59 billion in revenue.
The 5-cent-per-share charge is part of a gradual write-down of contracts from Medco's 2003 spinoff from drug maker Merck & Co. Revenue from retail sales grew 8 percent to $7.16 billion, while revenue from the mail-order business jumped 26 percent to $5.45 billion.
Revenue for the Accredo Health Group specialty pharmaceutical business grew 33 percent to almost $2 billion. Medco attributed that growth to clients it won in the first quarter, and the November 2007 buyout of infusion services provider Critical Care Systems Inc.
Prescriptions for the retail business grew 3 percent to 119.6 million. For the mail-order business, that total rose 12 percent to 26.3 million. Both units reported increased sales of low-cost generic drugs. In total, the dispensing rate for generic products rose to 63.7 percent of total prescriptions, up 4.8 percent from last year.
The company raised its 2008 earnings-per-share forecast to $2.30 to $2.33, from $2.27 to $2.31 previously. Analysts on average expect $2.30 per share.
During the quarter, Medco bought back 12.4 million shares, or 8.3 percent of its available shares at the start of the quarter, for $562.4 million. The company has $400 million left on a stock buyback plan that began in 2005.
