CVS 1999 Annual Report Download - page 7

5
1999 Annual Report
We have already attained a leading position in the specialty pharmacy business with CVS ProCare.
We have good reason to be optimistic. CVS remains a powerful leader in a
vibrant industry. The pharmaceutical market is projected to grow by approximately
13 percent per year for the next several years. We hold the No. 1 share of this
growing market, and we are well-positioned to continue to capture more than
our fair share of that growth. We are the No. 1 provider in 30 of the nation’s top 100
drugstore markets, more than any other drugstore chain.
Yet there are still 48 of those top 100 markets where CVS
currently has no retail stores, presenting significant growth
potential. We opened a record 433 new or relocated CVS
stores and 12 ProCare apothecaries in 1999, and we expect
to open 400 to 450 new or relocated stores each year for the
foreseeable future.
We expect continued strong growth in our pharmacy
business, and healthy increases in our front store business
as we emphasize convenience and service. New stores and
relocations, as well as the rapid development of our new
strategic business units, will further accelerate our long-
term growth rate. All of these initiatives will help us achieve our long-term goal
of our return on invested capital to equal two times our weighted average cost
of capital.
Of course, it is the wise counsel of our distinguished board of directors and the
fervent commitment of our employees that enable us to capitalize on these
opportunities. We are fortunate to benefit from the wealth of leadership experience
in social service that Marian L. Heard brought to the CVS board of directors when
she joined in 1999. We want to express our sincere gratitude to our 100,000
employees for their dedication and commitment to our customers.
CVS enters the new millennium ideally positioned to build on its success. It is
with good reason that a special year-end issue of Fortune magazine selected CVS as
one of “10 Stocks for the Millennium,” noting our ability to combine the best of the
virtual and real worlds into our “clicks and mortar” retail format. We invite you to
visit us—On the Corner, On the Phone and On the Web—to see for yourself how we
continually enhance the delivery of total healthcare solutions for the way we live.
Sincerely,
Thomas M. Ryan
Chairman of the Board and Chief Executive Officer
Charles C. Conaway
President and Chief Operating Officer
CVS has created a new business
model in the fast-growing
specialty pharmacy field.
CVS ProCare provides specialty
pharmacy mail services and
plans to have more than 100
retail ProCare apothecaries,
which serve patients requiring
complex and expensive drug
therapies, in cities across the
nation.