Jean Coutu Group Inc. says its profits rose to $46.4-million in the fourth quarter, beating analyst expectations, as the company boost its dividend.
The drug store chain said Thursday that it would increase its quarterly dividend by 9.1 per cent to six cents per share.
The company experienced higher revenue in both its front of store and pharmacy divisions, which pushed earnings per share to 20 cents, above average expectations of 19 cents according to Thomson Reuters.
That compares to $42.8-million in profit or 18 cents per share a year ago.
Revenues increased to $655.6-million from $637-million, but below analyst predictions of $663-million.
Quebec's largest pharmacy retailer faced tepid growth in the quarter as a result of generic drug reform introduced by the provincial government.
The company had conceded that the new policy would hurt its results since generic drugs account for 20 per cent of the dollar value of its drug sales and 40 per cent of sales based on volume.
The province reduced how much pharmacists can receive in professional allowances from generic drugmakers to 16.5 per cent of the drug's price, down from 20 per cent. The allowances fall to 15 per cent in April 2012.
Distribution fees from the drug manufacturers will also be modestly reduced and the price of generic drugs will also be reduced to 25 per cent of the equivalent branded prescriptions, beginning in April 2012, from the current 50 per cent.