Archive for September, 2010

Walgreen results beat expectations

Tuesday, September 28th, 2010 | Finance News


CHICAGO (Reuters) – Walgreen Co (WAG.N) reported higher-than-expected quarterly earnings on Tuesday, helped by strong prescription drug sales, sending its shares up nearly 8 percent in premarket trading.

The biggest U.S. drug store chain said prescription sales at stores open more than a year rose 1.6 percent despite difficult comparisons to last year, when a swine flu pandemic boosted demand for medicines, tissues and other products.

Walgreen, which acquired New York chain Duane Reade earlier in the year, said gross profit margins increased, helped by stronger prices for general merchandise and a plan to cut costs.

Net earnings for the fourth quarter ended August 31 rose to $470 million, or 49 cents per share, compared to $436 million, or 44 cents per share, for the same quarter in 2009.

Analysts on average expected earnings of 44 cents per share, according to Thomson Reuters I/B/E/S.

Walgreen, which operates about 7,500 stores in the United States, said revenue increased 7.4 percent to $16.87 billion. Analysts were expecting $16.84 billion.

Sales at stores open at least a year rose 1.5 percent.

The company, along with competitors CVS Caremark Corp (CVS.N) and Rite Aid Corp (RAD.N), initiated a flu shot push late in the quarter to draw customers into stores well before the flu season peaks. Walgreen hopes to deliver as many as 15 million shots during this flu season.

Walgreen shares rose to $32.71 in premarket trading, up 7.8 percent from a close of $30.35 on Monday.

(Reporting by Emily Stephenson; editing by John Wallace)


July home prices dip but seen stabilizing

Tuesday, September 28th, 2010 | Finance News


NEW YORK (Reuters) – Single-family home prices dipped in July, and are seen stabilizing near the lows without the homebuyer tax credit that ended in April, Standard & Poor's/Case-Shiller home price indexes showed on Tuesday.

The S&P/Case Shiller composite index of 20 metropolitan areas declined 0.1 percent in July from June on a seasonally adjusted basis, as expected in a Reuters poll. The dip followed a 0.2 percent June rise, which was revised down from a 0.3 percent increase.

Unadjusted, the 20-city index gained 0.6 percent after June's 1 percent gain. A 0.4 percent rise was expected.

S&P, which publishes the indexes, also said home prices in the 20 cities index rose 3.2 percent from July 2009, a slower annual pace than the 4.2 percent increased in June.

Ten of the cities had annual gains and only Las Vegas set a new low, as the impact of the homebuyer tax credit faded away, S&P said. But the year-over-year growth rates slowed in 16 of the cities and both the 10- and 20-city composite indexes in July from the prior month.

"While we could still see some residual support from the homebuyers' tax credit, which covers purchases closing through September 30th, anyone looking for home prices to return to the lofty 2005-2006 levels might be disappointed," David M. Blitzer, Chairman of the Index Committee at S&P, said in a press release.

"Housing starts, sales and inventory data reported for August do not show signs of a robust market, and foreclosures continue," he said, adding "stable prices seem more likely."

The 20-city index showed home prices remain 27.9 percent below the peaks set in mid-2006.

(Reporting by Lynn Adler; Editing by James Dalgleish)


Gallup: 25 percent hike in depression along Gulf

Tuesday, September 28th, 2010 | Finance News


ORANGE BEACH, Ala. – Before the BP oil spill, the Gulf Coast was a place of abundant shrimping, tourist-filled beaches and a happy if humble lifestyle. Now, it's home to depression, worry and sadness for many.

A Gallup survey released Tuesday of almost 2,600 coastal residents showed that depression cases are up more than 25 percent since an explosion killed 11 people and unleashed a three-month gusher of crude into the Gulf in April that ruined many livelihoods. The conclusions were consistent with trends seen in smaller studies and witnessed by mental health workers.

People just aren't as happy as they used to be despite palm trees and warm weather. A "well-being index" included in the Gallup study said many coastal residents are stressed out, worried and sad more often than people living inland, an indication that the spill's emotional toll lingers even if most of the oil has vanished from view.

Margaret Carruth is among those fighting to hang on.

Her hairstyling business dried up after tourists stopped coming to the beach and locals cut back on nonessentials like haircuts. All but broke and unable to afford rent, Carruth packed her belongings into her truck and a storage shed and now depends on friends for shelter.

"I'm a strong person and always have been, but I'm almost to the breaking point," says Carruth.

The Gallup survey was conducted in 25 Gulf-front counties from Texas east to Florida over eight months before and after the spill, ending Aug. 6. People reported 25.6 percent more depression diagnoses after then spill than before it, although the study didn't conclude the additional cases were tied directly to the oil.

The survey said people along the Gulf reported feeling sad, worried and stressed after the spill, while people living inland reported less over the same period. More than 40 percent of people in coastal areas reported feeling stress after the BP geyser blew, a 15 percent increase from before.

The oil spill followed waves of hard luck for the Gulf region, including hurricanes and recession. Experts say it's impossible to determine how much of the current mental health downturn could have roots in problems other than crude washing into marshes and beaches, damaging the seafood and tourist industries.

But an earlier study conducted in 13 counties and parishes with a total population of 1.9 million showed that 13 percent of coastal adults from Louisiana to Florida suffered probable serious mental illnesses after the spill.

The level of mental illness was similar to that seen six months after Hurricane Katrina decimated the coast five years ago, and experts aren't yet seeing any improvement in mental health five months after the oil crisis began. Before Katrina, a study by the National Institute of Mental Health said only 6 percent of area residents had likely mental illnesses.

"From the types of patients we are seeing in our emergency departments, clinics and hospitals, the problems are persisting," said William Pinsky of the New Orleans-based Ochsner Health System, which conducted the random telephone survey of 406 people in four states during the summer.

Sleeplessness, anxiety, depression, anger, substance abuse and domestic violence are among the most common problems reported by mental health agencies.

BP has provided $52 million for mental health care in the Gulf region, with $15 million going to the Louisiana Department of Health and Hospitals; $12 million each to the states of Alabama and Mississippi; $3 million to Florida; and $10 million to the federal Substance Abuse and Mental Health Services Administration.

Even though the oil stopped flowing in July and the BP well was finally killed this month, some officials say the toll on mental health may get worse as the financial strains of summer persist into the fall.

"It's like a virus that's spreading," said Tonya Fistein, one of four counselors hired by AltaPointe Health Systems specifically to help people deal emotionally with the spill in Bayou La Batre, a tiny Alabama fishing community hard hit by the disaster.

AltaPointe's clinic is seeing twice as many new patients as in 2009, an increase it blames on the spill. In Gulfport, Miss., 42 percent of the patients surveyed at the Gulf Coast Mental Health Center said they were sad or depressed because of the spill.

Steve Barrileaux, a psychologist at the Gulfport center, said some of the problems leading to mental health issues are obvious, like the loss of work by a person who rented chairs on the beach. Others are more subtle.

Many people are deeply worried about the environment, for instance, or lament the lost moments they would have spent fishing recreationally with loved ones. Others are still afraid to eat seafood, even on the coast where livelihoods depend on it.

"What's scary is the long-term damage that can be done, and we just don't know about that," Barrileaux said.

Chanthy Prak frets constantly about how to make ends meet in the post-spill world.

Prak worked in crab houses around Bayou La Batre before the oil hit. She and her husband, another seafood worker displaced by the spill, have received only $5,000 in claims payments since May to support them and their seven children.

"I worry. There's money going out but no money coming in," said the Cambodia native.

In some areas, higher rates of mental problems appear to have little to do with the oil.

At Lakeview Center, which provides mental health services in Pensacola, Fla., calls have increased to a crisis intervention line compared to 2009, but relatively few people have mentioned the oil spill as the reason they need help, said spokeswoman Karen Smith. Psychologists believe the uptick is most likely linked to the recession, she said.

More oil came ashore just to the west of Pensacola in Baldwin County, Ala., however, and a survey conducted for the state by the Centers for Disease Control and Prevention found significant mental health problems that people blamed on the spill.

Twenty-three percent of households in the area reported having at least one person who blamed sleep troubles on the spill, and 11 percent had at least one person with appetite loss. Perhaps most tellingly, 32 percent reported a decrease in income linked to the oil spill, which could lead to additional strain, said Dr. Charles Woernle, the state epidemiologist with the Alabama Department of Public Health.

Officials along the Gulf Coast worry that many of the hardest-hit groups — shrimpers, Asian seafood workers and low-wage tourism employees — won't seek help for mental problems because of cultural taboos.

At AltaPointe, officials hope to use a share of the BP money to pay for additional oil-spill counselors.

Tejuania Nelson, who runs a day-care center in fishing-dependent Grand Bay, Ala., said preschoolers whose parents were left jobless because of the spill are lashing out in unsettling ways.

"They're throwing desks, kicking chairs," she said. "It's sad. With this, people do not have hope. They cannot see a better time."