Walgreen ( WAG) shares jumped early Monday after the drugstore chain reported a 30% increase in first-quarter profit, helped by digital photo processing sales. The Illinois-based company said net income for the period ended Nov. 30 rose 30.5% to $332.7 million, or 32 cents a share, vs. $254.9 million, or 25 cents a share, a year ago. Excluding a pretax gain from a legal settlement of a penny a share, net income was $323.2 million, or 31 cents a share. The consensus estimate was 29 cents a share, according to Thomson First Call. Shares were up $1.58, or 4.1%, to $39.95 in premarket trading. Revenue increased 13.4% to a record $9.9 billion. Same-store sales were up 9.4% in the quarter. Prescription sales climbed 14.4% overall and 11.3% on a same-store basis. "We're incurring significant costs with our conversion to digital labs," the company said, "but those are far outweighed by improved customer satisfaction and better gross profit." Walgreen opened 111 new stores in the quarter and plans to open approximately 450 new ones during fiscal 2005.