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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Walgreens Boots Alliance Inc | NASDAQ:WBA | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.45 | -2.73% | 16.02 | 16.02 | 16.04 | 16.40 | 15.89 | 16.40 | 16,012,314 | 00:59:14 |
|
☑
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
WALGREENS BOOTS ALLIANCE, INC.
|
||
(Exact name of registrant as specified in its charter)
|
||
Delaware
|
|
47-1758322
|
(State of incorporation)
|
|
(I.R.S. Employer Identification No.)
|
108 Wilmot Road, Deerfield, Illinois
|
|
60015
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $0.01 par value
|
WBA
|
The Nasdaq Stock Market LLC
|
2.875% Walgreens Boots Alliance, Inc. notes due 2020
|
WBA20
|
The Nasdaq Stock Market LLC
|
3.600% Walgreens Boots Alliance, Inc. notes due 2025
|
WBA25
|
The Nasdaq Stock Market LLC
|
2.125% Walgreens Boots Alliance, Inc. notes due 2026
|
WBA26
|
The Nasdaq Stock Market LLC
|
|
Large accelerated filer ☑
|
Accelerated filer ☐
|
|
Non-accelerated filer ☐
|
Smaller reporting company ☐
|
|
|
Emerging growth company ☐
|
|
Part I
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Page
|
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
||
|
||
Part II
|
||
|
||
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
|
||
|
||
Part III
|
||
|
||
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
|
||
|
||
Part IV
|
||
|
||
Item 15.
|
||
Item 16.
|
||
|
1
|
As of August 31, 2019, using publicly available information for AmerisourceBergen.
|
2
|
Over 12 - month period ending August 31, 2019, using publicly available information for AmerisourceBergen.
|
•
|
Retail Pharmacy USA;
|
•
|
Retail Pharmacy International; and
|
•
|
Pharmaceutical Wholesale.
|
|
|
Fiscal 2019
|
|
Fiscal 2018
|
|
Fiscal 2017
|
|||
Pharmacy
|
|
74
|
%
|
|
72
|
%
|
|
69
|
%
|
Retail
|
|
26
|
%
|
|
28
|
%
|
|
31
|
%
|
Total
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
Fiscal 2019
|
|
Fiscal 2018
|
|
Fiscal 2017
|
|||
Pharmacy
|
|
36
|
%
|
|
35
|
%
|
|
35
|
%
|
Retail
|
|
64
|
%
|
|
65
|
%
|
|
65
|
%
|
Total
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
•
|
compliance with a wide variety of foreign laws and regulations, including retail and wholesale pharmacy, licensing, tax, foreign trade, intellectual property, privacy and data protection, immigration, currency, political and other business restrictions and requirements and local laws and regulations, whose interpretation and enforcement vary significantly among jurisdictions and can change significantly over time;
|
•
|
additional U.S. and other regulation of non-domestic operations, including regulation under the Foreign Corrupt Practices Act, the UK Bribery Act and other anti-corruption laws;
|
•
|
potential difficulties in managing foreign operations, mitigating credit risks in foreign markets, enforcing agreements and collecting receivables through foreign legal systems;
|
•
|
price controls imposed by foreign countries, tariffs, duties or other restrictions on foreign currencies or trade sanctions and other trade barriers imposed by foreign countries that restrict or prohibit business transactions in certain markets, or fluctuations in currency rates;
|
•
|
impact of recessions and economic slowdowns in economies outside the United States, including foreign currency devaluation, higher interest rates, inflation, and increased government regulation or ownership of traditional private businesses;
|
•
|
the instability of foreign economies, governments and currencies and unexpected regulatory, economic or political changes in foreign markets; and
|
•
|
developing and emerging markets may be especially vulnerable to periods of instability and unexpected changes, and consumers in those markets may have relatively limited resources to spend on products and services.
|
•
|
Our Retail Pharmacy International and Pharmaceutical Wholesale divisions have substantial operations in the United Kingdom and other member countries of the European Union. In June 2016, voters in the United Kingdom approved an advisory referendum to withdraw from the European Union, which proposed exit (and the political, economic and other uncertainties it has raised), commonly referred to as “Brexit,” has exacerbated and may further exacerbate many of the risks and uncertainties described above. An original exit date was set for March 29, 2019, but following the UK parliament’s rejection of a negotiated outcome, the leaders of the member countries of the European Union have agreed to multiple extensions of the deadline for Brexit. Given the complexity and uncertainty surrounding the potential withdrawal and negotiations, including with respect to terms of trade and customs, there can be no assurance regarding the terms, timing or consummation of any such arrangements, and whether there will be an orderly withdrawal from the European Union or a so-called “hard Brexit” with no continuing UK participation in the EU’s Single Market or the EU Customs Union. The proposed withdrawal could, among other potential outcomes, adversely affect the tax, tax treaty, currency, operational, legal and regulatory regimes to which our businesses in the region are subject. The withdrawal could also, among other potential outcomes, disrupt the free movement of goods, services and people between the United Kingdom and the European Union and significantly disrupt trade between the United Kingdom and the European Union and other parties. Further, uncertainty around and developments regarding these and related issues has contributed to deteriorating market conditions and could further adversely impact consumer and investor confidence and the economy of the United Kingdom and the economies of other countries in which we operate and cause significant volatility in currency exchange rates. In the event of a “hard Brexit,” the related risks and uncertainties could be further exacerbated; and
|
•
|
Many of the products we sell are manufactured in whole or in part outside of the United States. In some cases, these products are imported by others and sold to us. In the United States, the Presidential Administration has discussed, and in some cases implemented, changes with respect to certain tax and trade policies, tariffs and other government regulations affecting trade between the United States and other countries. For example, concerns regarding trade relations between the United States and China have escalated during fiscal 2019 and discussions have continued through the date of this report, as both countries imposed significant tariffs on the importation of certain product categories. As a significant portion of our retail products are sourced from China, the imposition on the United States of these and any additional new tariffs on certain goods imported from China have adversely affected costs and could impact the profitability of retail product sales in our Retail Pharmacy USA division. While it is not possible to predict whether or when any additional changes will occur or what form they may take, significant changes in tax or trade policies, tariffs or trade relations between the United States and other countries could result in significant increases in our costs, restrict our access to certain suppliers and adversely impact economic activity. In addition, other countries may change their business and trade policies in anticipation of or in response to increased import tariffs and other changes in United States’ trade policy and regulations.
|
•
|
requiring us to dedicate significant cash flow from operations to the payment of principal, interest and other amounts payable on our debt, which would reduce the funds we have available for other purposes, such as working capital, capital expenditures, acquisitions, share repurchases and dividends;
|
•
|
making it more difficult or expensive for us to obtain any necessary future financing for working capital, capital expenditures, debt service requirements, debt refinancing, acquisitions or other purposes;
|
•
|
reducing our flexibility in planning for or reacting to changes in our industry and market conditions and making us more vulnerable in the event of a downturn in our business operations; and
|
•
|
exposing us to interest rate risk given that a portion of our debt obligations is at variable interest rates.
|
•
|
actual or anticipated variations in quarterly operating results and the results of competitors;
|
•
|
changes in financial estimates by us or by any securities analysts that might cover us;
|
•
|
conditions or trends in the industry, including regulatory changes or changes in the securities marketplace;
|
•
|
announcements by us or our competitors of significant acquisitions, strategic partnerships or divestitures;
|
•
|
announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us;
|
•
|
additions or departures of key personnel;
|
•
|
issuances or sales of our common stock (or the exercise of related registration rights), including sales of shares by our directors and officers or key investors, including the SP Investors and certain other former Alliance Boots stockholders, subject to restrictions in the case of shares held by persons deemed to be our affiliates and to certain obligations pursuant to a shareholders agreement (as amended, the “Company Shareholders Agreement”) with certain of the SP Investors; and
|
•
|
various other market factors or perceived market factors, including rumors or speculation, whether or not correct, involving or affecting us or our industries, vendors, customers, strategic partners or competitors.
|
•
|
our ability to establish effective advertising, marketing and promotional programs;
|
•
|
inflation, new or increased taxes, adverse fluctuations in foreign currency exchange rates, changes in market conditions or otherwise;
|
•
|
natural disasters, civil unrest, severe weather conditions, terrorist activities, global political and economic developments, war, health epidemics or pandemics or the prospect of these events;
|
•
|
liabilities or expense relating to the protection of the environment, related health and safety matters, environmental remediation or compliance with environmental laws and regulations, including those governing exposure to, and the management and disposal of, hazardous substances;
|
•
|
the long-term effects of climate change on general economic conditions and the pharmacy industry in particular, along with changes in the supply, demand or available sources of energy and the regulatory and other costs associated with energy production and delivery;
|
•
|
adverse publicity and potential losses, liabilities and reputational harm stemming from any public incident (whether occurring online, in social media, in our stores or other company facilities, or elsewhere) involving our company, our personnel or our brands, including any such public incident involving our customers, products, services, stores or other property, or those of any of our vendors or other parties with which we do business; and
|
•
|
negative publicity, even if unwarranted, related to safety or quality, human and workplace rights, or other issues damaging our brand image and corporate reputation, or that of any of our vendors or strategic allies.
|
|
Retail stores
|
|
Retail Pharmacy USA:
|
|
|
United States
|
9,168
|
|
Puerto Rico
|
108
|
|
U.S. Virgin Islands
|
1
|
|
|
9,277
|
|
|
|
|
Retail Pharmacy International:
|
|
|
United Kingdom
|
2,465
|
|
Mexico
|
1,174
|
|
Chile
|
341
|
|
Thailand
|
293
|
|
Norway
|
159
|
|
The Republic of Ireland
|
87
|
|
The Netherlands
|
59
|
|
Lithuania
|
27
|
|
|
4,605
|
|
Walgreens Boots Alliance total
|
13,882
|
|
Name
|
|
Age
|
|
Office(s) held
|
James A. Skinner
|
|
74
|
|
Executive Chairman of the Board
|
Stefano Pessina
|
|
78
|
|
Executive Vice Chairman and Chief Executive Officer
|
Ornella Barra
|
|
65
|
|
Co-Chief Operating Officer
|
Alexander W. Gourlay
|
|
59
|
|
Co-Chief Operating Officer
|
James Kehoe
|
|
56
|
|
Executive Vice President and Global Chief Financial Officer
|
Marco Pagni
|
|
57
|
|
Executive Vice President, Global Chief Administrative Officer and General Counsel
|
Kathleen Wilson-Thompson
|
|
62
|
|
Executive Vice President and Global Chief Human Resources Officer
|
Heather Dixon
|
|
47
|
|
Senior Vice President, Global Controller and Chief Accounting Officer
|
|
|
Issuer purchases of equity securities
|
||||||||||||
Period
|
|
Total number of shares purchased
|
|
Average price paid per share
|
|
Total number of shares purchased as part of publicly announced repurchase programs1
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs1
|
||||||
6/1/19 - 6/30/19
|
|
2,384,600
|
|
|
$
|
51.94
|
|
|
2,384,600
|
|
|
$
|
3,753,404,394
|
|
7/1/19 - 7/31/19
|
|
2,348,488
|
|
|
55.02
|
|
|
2,348,488
|
|
|
3,624,165,659
|
|
||
8/1/19 - 8/31/19
|
|
3,498,400
|
|
|
51.97
|
|
|
2,598,400
|
|
|
3,489,712,386
|
|
||
|
|
8,231,488
|
|
|
$
|
52.83
|
|
|
7,331,488
|
|
|
$
|
3,489,712,386
|
|
1
|
In June 2018, Walgreens Boots Alliance authorized a stock repurchase program, which authorized the repurchase of up to $10.0 billion of Walgreens Boots Alliance common stock. This program has no specified expiration date.
|
Fiscal year
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
20156
|
||||||||||
Sales
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
|
$
|
117,351
|
|
|
$
|
103,444
|
|
Cost of sales
|
106,790
|
|
|
100,745
|
|
|
89,052
|
|
|
87,477
|
|
|
76,691
|
|
|||||
Gross profit
|
30,076
|
|
|
30,792
|
|
|
29,162
|
|
|
29,874
|
|
|
26,753
|
|
|||||
Selling, general and administrative expenses1
|
25,242
|
|
|
24,694
|
|
|
23,813
|
|
|
23,841
|
|
|
22,349
|
|
|||||
Equity earnings in AmerisourceBergen2
|
164
|
|
|
191
|
|
|
135
|
|
|
37
|
|
|
—
|
|
|||||
Equity earnings in Alliance Boots3
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
315
|
|
|||||
Operating income
|
4,998
|
|
|
6,289
|
|
|
5,484
|
|
|
6,070
|
|
|
4,719
|
|
|||||
Gain on previously held equity interest4
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
563
|
|
|||||
Other income (expense)1, 5
|
233
|
|
|
302
|
|
|
62
|
|
|
(330
|
)
|
|
634
|
|
|||||
Earnings before interest and income tax provision
|
5,231
|
|
|
6,591
|
|
|
5,546
|
|
|
5,740
|
|
|
5,916
|
|
|||||
Interest expense, net
|
704
|
|
|
616
|
|
|
693
|
|
|
596
|
|
|
605
|
|
|||||
Earnings before income tax provision
|
4,527
|
|
|
5,975
|
|
|
4,853
|
|
|
5,144
|
|
|
5,311
|
|
|||||
Income tax provision
|
588
|
|
|
998
|
|
|
760
|
|
|
997
|
|
|
1,056
|
|
|||||
Post tax earnings from other equity method investments
|
23
|
|
|
54
|
|
|
8
|
|
|
44
|
|
|
24
|
|
|||||
Net earnings
|
3,962
|
|
|
5,031
|
|
|
4,101
|
|
|
4,191
|
|
|
4,279
|
|
|||||
Net earnings attributable to noncontrolling interests
|
(20
|
)
|
|
7
|
|
|
23
|
|
|
18
|
|
|
59
|
|
|||||
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
$
|
3,982
|
|
|
$
|
5,024
|
|
|
$
|
4,078
|
|
|
$
|
4,173
|
|
|
$
|
4,220
|
|
Per Common Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
$
|
4.32
|
|
|
$
|
5.07
|
|
|
$
|
3.80
|
|
|
$
|
3.85
|
|
|
$
|
4.05
|
|
Diluted
|
4.31
|
|
|
5.05
|
|
|
3.78
|
|
|
3.82
|
|
|
4.00
|
|
|||||
Dividends declared
|
1.778
|
|
|
1.640
|
|
|
1.525
|
|
|
1.455
|
|
|
1.373
|
|
|||||
Balance Sheet
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total assets
|
$
|
67,598
|
|
|
$
|
68,124
|
|
|
$
|
66,009
|
|
|
$
|
72,688
|
|
|
$
|
68,782
|
|
Long-term debt
|
11,098
|
|
|
12,431
|
|
|
12,684
|
|
|
18,705
|
|
|
13,315
|
|
|||||
Total Walgreens Boots Alliance, Inc. shareholders’ equity
|
23,512
|
|
|
26,007
|
|
|
27,466
|
|
|
29,880
|
|
|
30,861
|
|
|||||
Noncontrolling interests
|
641
|
|
|
682
|
|
|
808
|
|
|
401
|
|
|
439
|
|
|||||
Total equity
|
$
|
24,152
|
|
|
$
|
26,689
|
|
|
$
|
28,274
|
|
|
$
|
30,281
|
|
|
$
|
31,300
|
|
1
|
The Company adopted ASU 2017-07, Compensation - Retirement Benefits (Topic 715) as of September 1, 2018 (fiscal 2019) on a retrospective basis. The impact on our previously reported net periodic costs as a result of the retrospective adoption of this standard results in a reclassification from selling, general and administrative expenses to other income (expense) of $125 million, $73 million, $(69) million and $(51) million for the fiscal years ended August 31, 2018, 2017, 2016 and 2015, respectively.
|
2
|
Effective March 18, 2016, the Company began accounting for its investment in AmerisourceBergen using the equity method of accounting, subject to a two-month reporting lag. Due to the March 18, 2016 effective date and the two-month reporting lag, the Company’s results for the 12 month period ended August 31, 2016 include approximately three and a half months of equity method income relating to its investment in AmerisourceBergen. Similarly, results for the 12 month period ended August 31, 2017 include approximately ten and a half months of equity income reflecting the Company’s increased ownership following the exercise on August 25, 2016 of the second tranche of warrants.
|
3
|
On August 2, 2012, the Company completed the acquisition of 45% of the issued and outstanding share capital of Alliance Boots in exchange for cash and Company shares. The Company accounted for this investment under the equity method until it completed the acquisition of the remaining 55% of Alliance Boots on December 31, 2014. As a result, fiscal 2015 includes the results of Alliance Boots for eight months (January through August 2015) on a fully consolidated basis and four months (September through December 2014) as equity earnings in Alliance Boots reflecting Walgreens’ pre-merger 45% interest.
|
4
|
In fiscal 2015, as a result of acquiring the remaining 55% interest in Alliance Boots, the Company’s previously held 45% interest was remeasured to fair value, resulting in a gain of $563 million.
|
5
|
Fiscal 2019 primarily reflects gain recognition resulting from the termination of the option granted to Rite Aid to become a member of the Company’s group purchasing organization. Fiscal 2018 includes the gain on sale of the Company’s equity interest in Premise Health Holding Corp., partially offset by the impairment of the Company’s equity method investment in Guangzhou Pharmaceuticals Corporation. In fiscal 2016 and 2015, the Company recorded other income (expense) of $(517) million and $779 million, respectively, from fair value adjustments of the AmerisourceBergen warrants and the amortization of the deferred credit associated with the initial value of the warrants. Fiscal 2016 also includes income of $268 million related to the change in accounting method for the Company’s investment in AmerisourceBergen. Fiscal 2015 also includes a $94 million loss on derivative contracts that were not designated as accounting hedges.
|
6
|
To improve comparability, certain classification changes were made to prior period sales, cost of sales and selling, general and administrative expenses. These changes had no impact on operating income. The reclassifications were made in the fourth quarter of fiscal 2016.
|
•
|
Retail Pharmacy USA;
|
•
|
Retail Pharmacy International; and
|
•
|
Pharmaceutical Wholesale
|
Twelve Months Ended August 31, 2019
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Walgreens Boots Alliance, Inc.
|
||||||||
Lease obligations and other real estate costs
|
$
|
5
|
|
|
$
|
19
|
|
|
$
|
1
|
|
|
$
|
25
|
|
Asset impairments1
|
95
|
|
|
67
|
|
|
98
|
|
|
260
|
|
||||
Employee severance and business transition costs
|
42
|
|
|
34
|
|
|
49
|
|
|
125
|
|
||||
Information technology transformation and other exit costs
|
5
|
|
|
10
|
|
|
7
|
|
|
22
|
|
||||
Total pre-tax exit and disposal charges
|
$
|
147
|
|
|
$
|
130
|
|
|
$
|
154
|
|
|
$
|
432
|
|
Other IT transformation costs
|
42
|
|
|
3
|
|
|
1
|
|
|
45
|
|
||||
Total pre-tax charges
|
$
|
189
|
|
|
$
|
133
|
|
|
$
|
155
|
|
|
$
|
477
|
|
|
|
(in millions, except per share amounts)
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
Gross profit
|
|
30,076
|
|
|
30,792
|
|
|
29,162
|
|
|||
Selling, general and administrative expenses1
|
|
25,242
|
|
|
24,694
|
|
|
23,813
|
|
|||
Equity earnings in AmerisourceBergen
|
|
164
|
|
|
191
|
|
|
135
|
|
|||
Operating income1
|
|
4,998
|
|
|
6,289
|
|
|
5,484
|
|
|||
Adjusted operating income (Non-GAAP measure)2
|
|
6,942
|
|
|
7,679
|
|
|
7,467
|
|
|||
Earnings before interest and income tax provision
|
|
5,231
|
|
|
6,591
|
|
|
5,546
|
|
|||
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
|
3,982
|
|
|
5,024
|
|
|
4,078
|
|
|||
Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. (Non-GAAP measure)2
|
|
5,529
|
|
|
5,985
|
|
|
5,503
|
|
|||
Net earnings per common share – diluted
|
|
4.31
|
|
|
5.05
|
|
|
3.78
|
|
|||
Adjusted net earnings per common share – diluted (Non-GAAP measure)2
|
|
5.99
|
|
|
6.02
|
|
|
5.10
|
|
|
|
Percentage increases (decreases)
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Sales
|
|
4.1
|
|
11.3
|
|
0.7
|
Gross profit
|
|
(2.3)
|
|
5.6
|
|
(2.4)
|
Selling, general and administrative expenses1
|
|
2.2
|
|
3.7
|
|
(0.1)
|
Operating income1
|
|
(20.5)
|
|
14.7
|
|
(9.7)
|
Adjusted operating income (Non-GAAP measure)2
|
|
(9.6)
|
|
2.8
|
|
2.6
|
Earnings before interest and income tax provision
|
|
(20.6)
|
|
18.8
|
|
(3.4)
|
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
|
(20.7)
|
|
23.2
|
|
(2.3)
|
Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. (Non-GAAP measure)2
|
|
(7.6)
|
|
8.8
|
|
9.9
|
Net earnings per common share – diluted
|
|
(14.6)
|
|
33.6
|
|
(1.0)
|
Adjusted net earnings per common share – diluted (Non-GAAP measure)2
|
|
(0.5)
|
|
18.0
|
|
11.1
|
|
|
Percent to sales
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Gross margin
|
|
22.0
|
|
23.4
|
|
24.7
|
Selling, general and administrative expenses1
|
|
18.4
|
|
18.8
|
|
20.1
|
1
|
The Company adopted ASU 2017-07, Compensation - Retirement Benefits (Topic 715) as of September 1, 2018 (fiscal 2019) on a retrospective basis. The impact on our previously reported net periodic costs as a result of the retrospective adoption of this standard results in a reclassification from selling, general and administrative expenses to other income of $125 million and $73 million, for the fiscal years ended August 31, 2018 and 2017, respectively. See note 1, summary of major accounting policies, for additional information.
|
2
|
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP and related disclosures.
|
|
|
(in millions, except location amounts)
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
|
$
|
104,532
|
|
|
$
|
98,392
|
|
|
$
|
87,302
|
|
Gross profit
|
|
23,511
|
|
|
23,758
|
|
|
22,450
|
|
|||
Selling, general and administrative expenses1
|
|
19,424
|
|
|
18,971
|
|
|
18,356
|
|
|||
Operating income1
|
|
4,088
|
|
|
4,787
|
|
|
4,094
|
|
|||
Adjusted operating income (Non-GAAP measure)1,2
|
|
5,255
|
|
|
5,814
|
|
|
5,606
|
|
|||
|
|
|
|
|
|
|
||||||
Number of prescriptions3
|
|
843.7
|
|
|
823.1
|
|
|
764.4
|
|
|||
30-day equivalent prescriptions3,4
|
|
1,150.1
|
|
|
1,094.4
|
|
|
989.7
|
|
|||
Number of locations at period end
|
|
9,285
|
|
|
9,569
|
|
|
8,109
|
|
|
|
Percentage increases (decreases)
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Sales
|
|
6.2
|
|
12.7
|
|
4.2
|
Gross profit
|
|
(1.0)
|
|
5.8
|
|
0.6
|
Selling, general and administrative expenses1
|
|
2.4
|
|
3.4
|
|
2.5
|
Operating income1
|
|
(14.6)
|
|
16.9
|
|
(7.3)
|
Adjusted operating income (Non-GAAP measure)1,2
|
|
(9.6)
|
|
3.7
|
|
4.4
|
Comparable store sales5
|
|
2.0
|
|
1.5
|
|
2.8
|
Pharmacy sales
|
|
8.6
|
|
17.2
|
|
7.3
|
Comparable pharmacy sales5
|
|
4.0
|
|
3.4
|
|
4.7
|
Retail sales
|
|
—
|
|
2.4
|
|
(2.4)
|
Comparable retail sales5
|
|
(2.4)
|
|
(2.4)
|
|
(1.0)
|
Comparable number of prescriptions4,5
|
|
(0.1)
|
|
0.8
|
|
4.0
|
Comparable 30-day equivalent prescriptions3,4,5
|
|
3.0
|
|
3.5
|
|
7.1
|
|
|
Percent to sales
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Gross margin
|
|
22.5
|
|
24.1
|
|
25.7
|
Selling, general and administrative expenses1
|
|
18.6
|
|
19.3
|
|
21.0
|
1
|
The Company adopted ASU 2017-07 Topic 715 as of September 1, 2018 (fiscal 2019) on a retrospective basis. The impact for Retail Pharmacy USA on our previously reported net periodic costs as a result of the retrospective adoption of this standard results in a reclassification from selling, general and administrative expenses to other income (expense) of $109 million and $101 million, for the fiscal years ended August 31, 2018 and 2017, respectively. See note 1, summary of major accounting policies, for additional information.
|
2
|
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP and related disclosures.
|
3
|
Includes immunizations.
|
4
|
Includes the adjustment to convert prescriptions greater than 84 days to the equivalent of three 30-day prescriptions. This adjustment reflects that these prescriptions include approximately three times the amount of product days supplied compared to a normal prescription.
|
5
|
Comparable stores are defined as those that have been open for at least twelve consecutive months without closure for seven or more consecutive days and without a major remodel or being subject to a natural disaster in the past twelve months. Relocated stores are not included as comparable stores for the first twelve months after the relocation. Acquired stores are not included as comparable stores for the first twelve months after acquisition or conversion, when applicable, whichever is later. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods.
|
|
|
(in millions, except location amounts)
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
|
$
|
11,462
|
|
|
$
|
12,281
|
|
|
$
|
11,813
|
|
Gross profit
|
|
4,522
|
|
|
4,958
|
|
|
4,753
|
|
|||
Selling, general and administrative expenses1
|
|
4,084
|
|
|
4,134
|
|
|
3,982
|
|
|||
Operating income1
|
|
438
|
|
|
824
|
|
|
771
|
|
|||
Adjusted operating income (Non-GAAP measure)1,2
|
|
747
|
|
|
929
|
|
|
939
|
|
|||
Number of locations at period end
|
|
4,605
|
|
|
4,767
|
|
|
4,722
|
|
|
|
Percentage increases (decreases)
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Sales
|
|
(6.7)
|
|
4.0
|
|
(10.9)
|
Gross profit
|
|
(8.8)
|
|
4.3
|
|
(12.5)
|
Selling, general and administrative expenses1
|
|
(1.2)
|
|
3.8
|
|
(8.4)
|
Operating income1
|
|
(46.8)
|
|
6.9
|
|
(29.1)
|
Adjusted operating income (Non-GAAP measure)1,2
|
|
(19.6)
|
|
(1.1)
|
|
(22.6)
|
Comparable store sales3
|
|
(6.4)
|
|
4.7
|
|
(10.6)
|
Comparable store sales in constant currency3,4
|
|
(1.7)
|
|
(1.4)
|
|
(0.2)
|
Pharmacy sales
|
|
(6.4)
|
|
4.3
|
|
(10.5)
|
Comparable pharmacy sales3
|
|
(5.7)
|
|
4.7
|
|
(10.7)
|
Comparable pharmacy sales in constant currency3,4
|
|
(0.9)
|
|
(1.2)
|
|
(1.0)
|
Retail sales
|
|
(6.8)
|
|
3.8
|
|
(11.1)
|
Comparable retail sales3
|
|
(6.8)
|
|
4.7
|
|
(10.6)
|
Comparable retail sales in constant currency3,4
|
|
(2.2)
|
|
(1.5)
|
|
0.2
|
|
|
Percent to sales
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Gross margin
|
|
39.5
|
|
40.4
|
|
40.2
|
Selling, general and administrative expenses1
|
|
35.6
|
|
33.7
|
|
33.7
|
1
|
The Company adopted ASU 2017-07, Compensation - Retirement Benefits (Topic 715) as of September 1, 2018 (fiscal 2019) on a retrospective basis. The impact for Retail Pharmacy International on our previously reported net periodic costs as a result of the retrospective adoption of this standard results in a reclassification from selling, general and administrative expenses to other income (expense) of $18 million and $(30) million, for the fiscal years ended August 31, 2018 and 2017, respectively. See note 1, summary of major accounting policies, for additional information.
|
2
|
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP and related disclosures.
|
3
|
Comparable stores are defined as those that have been open for at least twelve consecutive months without closure for seven or more consecutive days and without a major remodel or being subject to a natural disaster in the past twelve months. Relocated stores are not included as comparable stores for the first twelve months after the relocation. Acquired stores are not included as comparable stores for the first twelve months after acquisition or conversion, when applicable, whichever is later. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods.
|
4
|
The Company presents certain information related to current period operating results in “constant currency,” which is a non-GAAP financial measure. These amounts are calculated by translating current period results at the foreign currency exchange rates used in the comparable period in the prior year. The Company presents such constant currency financial information because it has significant operations outside of the United States reporting in currencies other than the U.S. dollar and this presentation provides a framework to assess how its business performed excluding the impact of foreign currency exchange rate fluctuations. See “--Non-GAAP Measures” below.
|
|
|
(in millions)
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
|
$
|
23,053
|
|
|
$
|
23,006
|
|
|
$
|
21,188
|
|
Gross profit
|
|
2,041
|
|
|
2,081
|
|
|
1,965
|
|
|||
Selling, general and administrative expenses1
|
|
1,734
|
|
|
1,594
|
|
|
1,481
|
|
|||
Equity earnings from AmerisourceBergen
|
|
164
|
|
|
191
|
|
|
135
|
|
|||
Operating income1
|
|
471
|
|
|
678
|
|
|
619
|
|
|||
Adjusted operating income (Non-GAAP measure)1,2
|
|
939
|
|
|
936
|
|
|
922
|
|
|
|
Percentage increases (decreases)
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Sales
|
|
0.2
|
|
8.6
|
|
(6.1)
|
Gross profit
|
|
(1.9)
|
|
5.9
|
|
(7.8)
|
Selling, general and administrative expenses1
|
|
8.8
|
|
7.6
|
|
(6.7)
|
Equity earnings from AmerisourceBergen
|
|
(14.2)
|
|
41.5
|
|
264.9
|
Operating income1
|
|
(30.4)
|
|
9.5
|
|
6.7
|
Adjusted operating income (Non-GAAP measure)1,2
|
|
0.4
|
|
1.5
|
|
30.0
|
Comparable sales3
|
|
0.2
|
|
8.6
|
|
(3.9)
|
Comparable sales in constant currency3,4
|
|
8.0
|
|
4.2
|
|
4.7
|
|
|
Percent to sales
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Gross margin
|
|
8.9
|
|
9.0
|
|
9.3
|
Selling, general and administrative expenses1
|
|
7.5
|
|
6.9
|
|
7.0
|
1
|
The Company adopted ASU 2017-07, Compensation - Retirement Benefits (Topic 715) as of September 1, 2018 (fiscal 2019) on a retrospective basis. The impact for Pharmaceutical Wholesale on our previously reported net periodic costs as a result of the retrospective adoption of this standard results in a reclassification from selling, general and administrative expenses to other income (expense) of $(2) million and $2 million, for the fiscal years ended August 31, 2018 and 2017, respectively. See note 1, summary of major accounting policies, for additional information.
|
2
|
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP and related disclosures.
|
3
|
Comparable Sales are defined as sales excluding acquisitions and dispositions.
|
4
|
The Company presents certain information related to current period operating results in “constant currency,” which is a non-GAAP financial measure. These amounts are calculated by translating current period results at the foreign currency exchange rates used in the comparable period in the prior year. The Company presents such constant currency financial information because it has significant operations outside of the United States reporting in currencies other than the U.S. dollar and this presentation provides a framework to assess how its business performed excluding the impact of foreign currency exchange rate fluctuations. See “--Non-GAAP Measures” below.
|
|
|
(in millions)
|
||||||||||||||||||
|
|
Twelve months ended August 31, 2018
|
||||||||||||||||||
|
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Eliminations
|
|
Walgreens Boots Alliance, Inc.
|
||||||||||
Operating income (GAAP)1
|
|
$
|
4,787
|
|
|
$
|
824
|
|
|
$
|
678
|
|
|
$
|
—
|
|
|
$
|
6,289
|
|
Acquisition-related amortization
|
|
260
|
|
|
105
|
|
|
83
|
|
|
—
|
|
|
448
|
|
|||||
Acquisition-related costs
|
|
231
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
231
|
|
|||||
Adjustments to equity earnings in AmerisourceBergen
|
|
—
|
|
|
—
|
|
|
175
|
|
|
—
|
|
|
175
|
|
|||||
Store optimization
|
|
100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100
|
|
|||||
LIFO provision
|
|
84
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
84
|
|
|||||
Certain legal and regulatory accruals and settlements3
|
|
284
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
284
|
|
|||||
Asset recovery
|
|
(15
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|||||
Hurricane-related costs
|
|
83
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
83
|
|
|||||
Adjusted operating income (Non-GAAP measure)1
|
|
$
|
5,814
|
|
|
$
|
929
|
|
|
$
|
936
|
|
|
$
|
—
|
|
|
$
|
7,679
|
|
|
|
(in millions)
|
||||||||||||||||||
|
|
Twelve months ended August 31, 2017
|
||||||||||||||||||
|
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Eliminations
|
|
Walgreens Boots Alliance, Inc.
|
||||||||||
Operating income (GAAP)1
|
|
$
|
4,094
|
|
|
$
|
771
|
|
|
$
|
619
|
|
|
$
|
—
|
|
|
$
|
5,484
|
|
Acquisition-related amortization
|
|
152
|
|
|
101
|
|
|
79
|
|
|
—
|
|
|
332
|
|
|||||
Acquisition-related costs
|
|
474
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
474
|
|
|||||
Adjustments to equity earnings in AmerisourceBergen
|
|
—
|
|
|
—
|
|
|
187
|
|
|
—
|
|
|
187
|
|
|||||
LIFO provision
|
|
166
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
166
|
|
|||||
Asset recovery
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|||||
Cost transformation
|
|
731
|
|
|
67
|
|
|
37
|
|
|
—
|
|
|
835
|
|
|||||
Adjusted operating income (Non-GAAP measure)1
|
|
$
|
5,606
|
|
|
$
|
939
|
|
|
$
|
922
|
|
|
$
|
—
|
|
|
$
|
7,467
|
|
1
|
The Company adopted new accounting guidance in Accounting Standards Update 2017-07 as of September 1, 2018 (fiscal 2019) on a retrospective basis for the Consolidated Statements of Earnings presentation. This change resulted in reclassification of all the other net cost components (excluding service cost component) of net pension cost and net postretirement benefit cost from selling, general and administrative expenses to other income (expense) with no impact on the Company’s net earnings.
|
2
|
Includes impairment of $73 million for indefinite-lived pharmacy licenses intangible asset recorded during the three months ended August 31, 2019, in the Boots reporting unit within the Retail Pharmacy International segment.
|
3
|
Beginning in the quarter ended August 31, 2018, management reviewed and refined its practice to include all charges related to the matters included in certain legal and regulatory accruals and settlements. This non-GAAP measure is presented on a consistent basis for fiscal year 2019.
|
|
|
(in millions)
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net earnings attributable to Walgreens Boots Alliance, Inc. (GAAP)
|
|
$
|
3,982
|
|
|
$
|
5,024
|
|
|
$
|
4,078
|
|
|
|
|
|
|
|
|
||||||
Adjustments to operating income:
|
|
|
|
|
|
|
||||||
Acquisition-related amortization and impairment1
|
|
567
|
|
|
448
|
|
|
332
|
|
|||
Transformational cost management
|
|
477
|
|
|
—
|
|
|
—
|
|
|||
Acquisition-related costs
|
|
303
|
|
|
231
|
|
|
474
|
|
|||
Adjustments to equity earnings in AmerisourceBergen
|
|
233
|
|
|
175
|
|
|
187
|
|
|||
Store optimization
|
|
196
|
|
|
100
|
|
|
—
|
|
|||
LIFO provision
|
|
136
|
|
|
84
|
|
|
166
|
|
|||
Certain legal and regulatory accruals and settlements2
|
|
31
|
|
|
284
|
|
|
—
|
|
|||
Asset recovery
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|||
Hurricane-related costs
|
|
—
|
|
|
83
|
|
|
(11
|
)
|
|||
Cost Transformation
|
|
—
|
|
|
—
|
|
|
835
|
|
|||
Total adjustments to operating income
|
|
1,944
|
|
|
1,390
|
|
|
1,983
|
|
|||
|
|
|
|
|
|
|
||||||
Adjustments to other income (expense):
|
|
|
|
|
|
|
|
|
||||
Net investment hedging loss (gain)
|
|
18
|
|
|
(21
|
)
|
|
48
|
|
|||
Gain on sale of equity method investment
|
|
—
|
|
|
(322
|
)
|
|
—
|
|
|||
Impairment of equity method investment
|
|
—
|
|
|
178
|
|
|
—
|
|
|||
Termination of option granted to Rite Aid
|
|
(173
|
)
|
|
—
|
|
|
—
|
|
|||
Total adjustments to other income (expense)
|
|
(155
|
)
|
|
(165
|
)
|
|
48
|
|
|||
|
|
|
|
|
|
|
||||||
Adjustments to interest expense, net:
|
|
|
|
|
|
|
|
|
||||
Prefunded acquisition financing costs
|
|
—
|
|
|
29
|
|
|
203
|
|
|||
Total adjustments to interest expense, net
|
|
—
|
|
|
29
|
|
|
203
|
|
|||
|
|
|
|
|
|
|
||||||
Adjustments to income tax provision:
|
|
|
|
|
|
|
|
|
||||
Equity method non-cash tax
|
|
18
|
|
|
25
|
|
|
23
|
|
|||
U.S. tax law changes3
|
|
(8
|
)
|
|
(125
|
)
|
|
—
|
|
|||
Tax impact of adjustments4
|
|
(291
|
)
|
|
(193
|
)
|
|
(755
|
)
|
|||
UK tax rate change3
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
|||
Total adjustments to income tax provision
|
|
(281
|
)
|
|
(293
|
)
|
|
(809
|
)
|
|||
|
|
|
|
|
|
|
||||||
Adjustments to post tax equity earnings from other equity method investments:
|
|
|
|
|
|
|
||||||
Adjustments to equity earnings in other equity method investments5
|
|
40
|
|
|
—
|
|
|
—
|
|
|||
Total adjustments to post tax equity earnings from other equity method investments
|
|
40
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. (Non-GAAP measure)
|
|
$
|
5,529
|
|
|
$
|
5,985
|
|
|
$
|
5,503
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Diluted net earnings per common share (GAAP)
|
|
$
|
4.31
|
|
|
$
|
5.05
|
|
|
$
|
3.78
|
|
|
|
|
|
|
|
|
||||||
Adjustments to operating income
|
|
2.10
|
|
|
1.40
|
|
|
1.84
|
|
|||
Adjustments to other income (expense)
|
|
(0.17
|
)
|
|
(0.17
|
)
|
|
0.04
|
|
|||
Adjustments to interest expense, net
|
|
—
|
|
|
0.03
|
|
|
0.19
|
|
|||
Adjustments to income tax provision
|
|
(0.30
|
)
|
|
(0.29
|
)
|
|
(0.75
|
)
|
|||
Adjustments to post tax equity earnings from other equity method investments
|
|
0.04
|
|
|
—
|
|
|
—
|
|
|||
Adjusted diluted net earnings per common share (Non-GAAP measure)
|
|
$
|
5.99
|
|
|
$
|
6.02
|
|
|
$
|
5.10
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding, diluted
|
|
923.5
|
|
|
995.0
|
|
|
1,078.5
|
|
1
|
Includes impairment of $73 million for indefinite-lived pharmacy licenses intangible asset recorded during the three months ended August 31, 2019, in the Boots reporting unit within the Retail Pharmacy International segment.
|
2
|
Beginning in the quarter ended August 31, 2018, management reviewed and refined its practice to include all charges related to the matters included in certain legal and regulatory accruals and settlements. This non-GAAP measure is presented on a consistent basis for fiscal year 2019.
|
3
|
Discrete tax-only items.
|
4
|
Represents the adjustment to the GAAP basis tax provision commensurate with non-GAAP adjustments.
|
5
|
Beginning in the quarter ended May 31, 2019, management reviewed and refined its practice to reflect the proportionate share of certain equity method investees’ non-cash items or unusual or infrequent items consistent with the Company’s non-GAAP measures in order to provide investors with a comparable view of performance across periods. These adjustments include acquisition-related amortization and acquisition-related costs and were immaterial for the prior periods presented. Although the Company may have shareholder rights and board representation commensurate with its ownership interests in these equity method investees, adjustments relating to equity method investments are not intended to imply that the Company has direct control over their operations and resulting revenue and expenses. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all revenue and expenses of these equity method investees.
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Retail Pharmacy USA
|
|
$
|
1,323
|
|
|
$
|
1,022
|
|
|
$
|
860
|
|
Retail Pharmacy International
|
|
275
|
|
|
241
|
|
|
384
|
|
|||
Pharmaceutical Wholesale
|
|
104
|
|
|
104
|
|
|
107
|
|
|||
Total
|
|
$
|
1,702
|
|
|
$
|
1,367
|
|
|
$
|
1,351
|
|
Rating Agency
|
Long-Term Debt Rating
|
Commercial
Paper Rating
|
Outlook
|
Fitch
|
BBB
|
F2
|
Negative
|
Moody’s
|
Baa2
|
P-2
|
Stable
|
Standard & Poor’s
|
BBB
|
A-2
|
Stable
|
|
|
Payments due by period
|
||||||||||||||||||
|
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
Over 5 years
|
||||||||||
Operating leases1
|
|
$
|
32,268
|
|
|
$
|
3,484
|
|
|
$
|
6,447
|
|
|
$
|
5,714
|
|
|
$
|
16,623
|
|
Purchase obligations:
|
|
3,231
|
|
|
2,359
|
|
|
224
|
|
|
100
|
|
|
548
|
|
|||||
Open inventory purchase orders
|
|
1,708
|
|
|
1,707
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Real estate development
|
|
179
|
|
|
179
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other obligations
|
|
1,344
|
|
|
474
|
|
|
223
|
|
|
100
|
|
|
548
|
|
|||||
Short-term debt and long-term debt*
|
|
16,916
|
|
|
5,752
|
|
|
1,741
|
|
|
1,200
|
|
|
8,223
|
|
|||||
Interest payment on short-term debt and long-term debt
|
|
4,704
|
|
|
430
|
|
|
761
|
|
|
635
|
|
|
2,878
|
|
|||||
Retirement benefit obligations
|
|
695
|
|
|
42
|
|
|
81
|
|
|
83
|
|
|
489
|
|
|||||
Closed location obligations1
|
|
1,613
|
|
|
211
|
|
|
359
|
|
|
286
|
|
|
757
|
|
|||||
Capital lease obligations*1
|
|
1,093
|
|
|
59
|
|
|
118
|
|
|
115
|
|
|
801
|
|
|||||
Finance lease obligations
|
|
311
|
|
|
21
|
|
|
41
|
|
|
40
|
|
|
209
|
|
|||||
Other liabilities reflected on the balance sheet*2
|
|
1,216
|
|
|
122
|
|
|
529
|
|
|
185
|
|
|
380
|
|
|||||
Total
|
|
$
|
62,047
|
|
|
$
|
12,480
|
|
|
$
|
10,302
|
|
|
$
|
8,358
|
|
|
$
|
30,908
|
|
*
|
Recorded on balance sheet.
|
1
|
Amounts do not include certain operating expenses under these leases such as common area maintenance, insurance and real estate taxes, where appropriate. These expenses were $569 million for the fiscal year ended August 31, 2019.
|
2
|
Includes $502 million ($88 million in less than 1 year, $385 million in 1-3 years and $29 million in 3-5 years) of unrecognized tax benefits recorded under Accounting Standards Codification Topic 740, Income Taxes. Includes $352 million ($67 million in 1-3 years, $96 million in 3-5 years and $189 million in over 5 years) of noncurrent income taxes payable as a result of the U.S tax law changes enacted in December 2017.
|
|
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,023
|
|
|
$
|
785
|
|
Accounts receivable, net
|
|
7,226
|
|
|
6,573
|
|
||
Inventories
|
|
9,333
|
|
|
9,565
|
|
||
Other current assets
|
|
1,118
|
|
|
923
|
|
||
Total current assets
|
|
18,700
|
|
|
17,846
|
|
||
Non-current assets:
|
|
|
|
|
|
|
||
Property, plant and equipment, net
|
|
13,478
|
|
|
13,911
|
|
||
Goodwill
|
|
16,560
|
|
|
16,914
|
|
||
Intangible assets, net
|
|
10,876
|
|
|
11,783
|
|
||
Equity method investments (see note 5)
|
|
6,851
|
|
|
6,610
|
|
||
Other non-current assets
|
|
1,133
|
|
|
1,060
|
|
||
Total non-current assets
|
|
48,899
|
|
|
50,278
|
|
||
Total assets
|
|
$
|
67,598
|
|
|
$
|
68,124
|
|
|
|
|
|
|
||||
Liabilities and equity
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Short-term debt
|
|
$
|
5,738
|
|
|
$
|
1,966
|
|
Trade accounts payable (see note 18)
|
|
14,341
|
|
|
13,566
|
|
||
Accrued expenses and other liabilities
|
|
5,474
|
|
|
5,862
|
|
||
Income taxes
|
|
216
|
|
|
273
|
|
||
Total current liabilities
|
|
25,769
|
|
|
21,667
|
|
||
Non-current liabilities:
|
|
|
|
|
|
|
||
Long-term debt
|
|
11,098
|
|
|
12,431
|
|
||
Deferred income taxes
|
|
1,785
|
|
|
1,815
|
|
||
Other non-current liabilities
|
|
4,795
|
|
|
5,522
|
|
||
Total non-current liabilities
|
|
17,678
|
|
|
19,768
|
|
||
Commitments and contingencies (see note 10)
|
|
|
|
|
|
|
||
Equity:
|
|
|
|
|
|
|
||
Preferred stock $.01 par value; authorized 32 million shares, none issued
|
|
—
|
|
|
—
|
|
||
Common stock $.01 par value; authorized 3.2 billion shares; issued 1,172,513,618 at August 31, 2019 and 2018
|
|
12
|
|
|
12
|
|
||
Paid-in capital
|
|
10,639
|
|
|
10,493
|
|
||
Retained earnings
|
|
35,815
|
|
|
33,551
|
|
||
Accumulated other comprehensive loss
|
|
(3,897
|
)
|
|
(3,002
|
)
|
||
Treasury stock, at cost; 277,126,116 shares at August 31, 2019 and 220,380,200 shares at August 31, 2018
|
|
(19,057
|
)
|
|
(15,047
|
)
|
||
Total Walgreens Boots Alliance, Inc. shareholders’ equity
|
|
23,512
|
|
|
26,007
|
|
||
Noncontrolling interests
|
|
641
|
|
|
682
|
|
||
Total equity
|
|
24,152
|
|
|
26,689
|
|
||
Total liabilities and equity
|
|
$
|
67,598
|
|
|
$
|
68,124
|
|
|
Equity attributable to Walgreens Boots Alliance, Inc.
|
|
|
|||||||||||||||||||||||
|
Common stock
shares
|
Common
stock
amount
|
Treasury
stock
amount
|
Paid-in
capital
|
Employee
stock
loan
receivable
|
Accumulated
other
comprehensive
income (loss)
|
Retained
earnings
|
Noncontrolling
interests
|
Total
equity
|
|||||||||||||||||
August 31, 2016
|
1,082,986,591
|
|
$
|
12
|
|
$
|
(4,934
|
)
|
$
|
10,111
|
|
$
|
(1
|
)
|
$
|
(2,992
|
)
|
$
|
27,684
|
|
$
|
401
|
|
$
|
30,281
|
|
Net earnings
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4,078
|
|
23
|
|
4,101
|
|
||||||||
Other comprehensive income (loss), net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(59
|
)
|
—
|
|
(36
|
)
|
(95
|
)
|
||||||||
Dividends declared and distributions
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,625
|
)
|
(98
|
)
|
(1,723
|
)
|
||||||||
Treasury stock purchases
|
(64,589,677
|
)
|
—
|
|
(5,220
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,220
|
)
|
||||||||
Employee stock purchase and option plans
|
5,452,156
|
|
—
|
|
183
|
|
34
|
|
1
|
|
—
|
|
—
|
|
—
|
|
218
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
91
|
|
—
|
|
—
|
|
—
|
|
—
|
|
91
|
|
|||||||||
Noncontrolling interests acquired and arising on business combinations
|
—
|
|
—
|
|
—
|
|
103
|
|
—
|
|
—
|
|
—
|
|
518
|
|
621
|
|
||||||||
August 31, 2017
|
1,023,849,070
|
|
$
|
12
|
|
$
|
(9,971
|
)
|
$
|
10,339
|
|
$
|
—
|
|
$
|
(3,051
|
)
|
$
|
30,137
|
|
$
|
808
|
|
$
|
28,274
|
|
Net earnings
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5,024
|
|
7
|
|
5,031
|
|
||||||||
Other comprehensive income (loss), net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
49
|
|
—
|
|
1
|
|
50
|
|
||||||||
Dividends declared and distributions
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,610
|
)
|
(138
|
)
|
(1,748
|
)
|
||||||||
Treasury stock purchases
|
(76,069,557
|
)
|
—
|
|
(5,228
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5,228
|
)
|
||||||||
Employee stock purchase and option plans
|
4,353,905
|
|
—
|
|
152
|
|
22
|
|
—
|
|
—
|
|
—
|
|
—
|
|
174
|
|
||||||||
Stock-based compensation
|
—
|
|
—
|
|
—
|
|
130
|
|
—
|
|
—
|
|
—
|
|
—
|
|
130
|
|
||||||||
Noncontrolling interests contribution and other
|
—
|
|
—
|
|
—
|
|
2
|
|
—
|
|
—
|
|
—
|
|
4
|
|
6
|
|
||||||||
August 31, 2018
|
952,133,418
|
|
$
|
12
|
|
$
|
(15,047
|
)
|
$
|
10,493
|
|
$
|
—
|
|
$
|
(3,002
|
)
|
$
|
33,551
|
|
$
|
682
|
|
$
|
26,689
|
|
Net earnings
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,982
|
|
(20
|
)
|
3,962
|
|
||||||||
Other comprehensive income (loss), net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(896
|
)
|
—
|
|
(13
|
)
|
(909
|
)
|
||||||||
Dividends declared and distributions
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,629
|
)
|
(3
|
)
|
(1,632
|
)
|
||||||||
Treasury stock purchases
|
(61,723,456
|
)
|
—
|
|
(4,160
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(4,160
|
)
|
||||||||
Employee stock purchase and option plans
|
4,977,540
|
|
—
|
|
150
|
|
24
|
|
—
|
|
—
|
|
—
|
|
—
|
|
174
|
|
||||||||
Stock-based compensation
|
—
|
|
—
|
|
—
|
|
119
|
|
—
|
|
—
|
|
—
|
|
—
|
|
119
|
|
||||||||
Adoption of new accounting standards
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(88
|
)
|
—
|
|
(88
|
)
|
||||||||
Noncontrolling interests contribution and other
|
—
|
|
—
|
|
—
|
|
3
|
|
—
|
|
—
|
|
(1
|
)
|
(5
|
)
|
(3
|
)
|
||||||||
August 31, 2019
|
895,387,502
|
|
$
|
12
|
|
$
|
(19,057
|
)
|
$
|
10,639
|
|
$
|
—
|
|
$
|
(3,897
|
)
|
$
|
35,815
|
|
$
|
641
|
|
$
|
24,152
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
Cost of sales
|
|
106,790
|
|
|
100,745
|
|
|
89,052
|
|
|||
Gross profit
|
|
30,076
|
|
|
30,792
|
|
|
29,162
|
|
|||
|
|
|
|
|
|
|
||||||
Selling, general and administrative expenses
|
|
25,242
|
|
|
24,694
|
|
|
23,813
|
|
|||
Equity earnings in AmerisourceBergen
|
|
164
|
|
|
191
|
|
|
135
|
|
|||
Operating income
|
|
4,998
|
|
|
6,289
|
|
|
5,484
|
|
|||
|
|
|
|
|
|
|
||||||
Other income
|
|
233
|
|
|
302
|
|
|
62
|
|
|||
Earnings before interest and income tax provision
|
|
5,231
|
|
|
6,591
|
|
|
5,546
|
|
|||
|
|
|
|
|
|
|
||||||
Interest expense, net
|
|
704
|
|
|
616
|
|
|
693
|
|
|||
Earnings before income tax provision
|
|
4,527
|
|
|
5,975
|
|
|
4,853
|
|
|||
Income tax provision
|
|
588
|
|
|
998
|
|
|
760
|
|
|||
Post tax earnings from other equity method investments
|
|
23
|
|
|
54
|
|
|
8
|
|
|||
Net earnings
|
|
3,962
|
|
|
5,031
|
|
|
4,101
|
|
|||
Net (loss) earnings attributable to noncontrolling interests
|
|
(20
|
)
|
|
7
|
|
|
23
|
|
|||
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
|
$
|
3,982
|
|
|
$
|
5,024
|
|
|
$
|
4,078
|
|
|
|
|
|
|
|
|
||||||
Net earnings per common share:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
$
|
4.32
|
|
|
$
|
5.07
|
|
|
$
|
3.80
|
|
Diluted
|
|
$
|
4.31
|
|
|
$
|
5.05
|
|
|
$
|
3.78
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
921.5
|
|
|
991.0
|
|
|
1,073.5
|
|
|||
Diluted
|
|
923.5
|
|
|
995.0
|
|
|
1,078.5
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Comprehensive income:
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
3,962
|
|
|
$
|
5,031
|
|
|
$
|
4,101
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
||||||
Pension/postretirement obligations
|
|
(149
|
)
|
|
240
|
|
|
73
|
|
|||
Unrealized gain on cash flow hedges
|
|
60
|
|
|
3
|
|
|
4
|
|
|||
Unrecognized (loss) on available-for-sale investments
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||
Share of other comprehensive income (loss) of equity method investments
|
|
(1
|
)
|
|
5
|
|
|
(1
|
)
|
|||
Currency translation adjustments
|
|
(820
|
)
|
|
(198
|
)
|
|
(169
|
)
|
|||
Total other comprehensive income (loss)
|
|
(909
|
)
|
|
50
|
|
|
(95
|
)
|
|||
Total comprehensive income
|
|
3,053
|
|
|
5,081
|
|
|
4,006
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income (loss) attributable to noncontrolling interests
|
|
(33
|
)
|
|
8
|
|
|
(13
|
)
|
|||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
|
$
|
3,086
|
|
|
$
|
5,073
|
|
|
$
|
4,019
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
3,962
|
|
|
$
|
5,031
|
|
|
$
|
4,101
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
2,038
|
|
|
1,770
|
|
|
1,654
|
|
|||
Gain on previously held equity interest
|
|
—
|
|
|
(337
|
)
|
|
—
|
|
|||
Deferred income taxes
|
|
100
|
|
|
(322
|
)
|
|
(434
|
)
|
|||
Stock compensation expense
|
|
119
|
|
|
130
|
|
|
91
|
|
|||
Equity earnings from equity method investments
|
|
(187
|
)
|
|
(244
|
)
|
|
(143
|
)
|
|||
Other
|
|
302
|
|
|
296
|
|
|
364
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable, net
|
|
(789
|
)
|
|
(391
|
)
|
|
(153
|
)
|
|||
Inventories
|
|
141
|
|
|
331
|
|
|
98
|
|
|||
Other current assets
|
|
(112
|
)
|
|
(22
|
)
|
|
—
|
|
|||
Trade accounts payable
|
|
954
|
|
|
1,352
|
|
|
1,684
|
|
|||
Accrued expenses and other liabilities
|
|
(374
|
)
|
|
287
|
|
|
(128
|
)
|
|||
Income taxes
|
|
(406
|
)
|
|
694
|
|
|
44
|
|
|||
Other non-current assets and liabilities
|
|
(154
|
)
|
|
(311
|
)
|
|
77
|
|
|||
Net cash provided by operating activities
|
|
5,594
|
|
|
8,263
|
|
|
7,255
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Additions to property, plant and equipment
|
|
(1,702
|
)
|
|
(1,367
|
)
|
|
(1,351
|
)
|
|||
Proceeds from sale leaseback transactions
|
|
3
|
|
|
—
|
|
|
444
|
|
|||
Proceeds from sale of other assets
|
|
117
|
|
|
655
|
|
|
59
|
|
|||
Business, investment and asset acquisitions, net of cash acquired
|
|
(741
|
)
|
|
(4,793
|
)
|
|
(88
|
)
|
|||
Other
|
|
16
|
|
|
4
|
|
|
93
|
|
|||
Net cash used for investing activities
|
|
(2,307
|
)
|
|
(5,501
|
)
|
|
(843
|
)
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Net change in short-term debt with maturities of 3 months or less
|
|
536
|
|
|
586
|
|
|
33
|
|
|||
Proceeds from debt
|
|
12,433
|
|
|
5,900
|
|
|
—
|
|
|||
Payments of debt
|
|
(10,461
|
)
|
|
(4,890
|
)
|
|
(6,196
|
)
|
|||
Stock purchases
|
|
(4,160
|
)
|
|
(5,228
|
)
|
|
(5,220
|
)
|
|||
Proceeds related to employee stock plans
|
|
174
|
|
|
174
|
|
|
217
|
|
|||
Cash dividends paid
|
|
(1,643
|
)
|
|
(1,739
|
)
|
|
(1,723
|
)
|
|||
Other
|
|
75
|
|
|
(98
|
)
|
|
(45
|
)
|
|||
Net cash used for financing activities
|
|
(3,047
|
)
|
|
(5,295
|
)
|
|
(12,934
|
)
|
|||
|
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
(9
|
)
|
|
11
|
|
|
26
|
|
|||
Changes in cash, cash equivalents and restricted cash
|
|
|
|
|
|
|
|
|
|
|||
Net increase (decrease) in cash, cash equivalents, and restricted cash
|
|
232
|
|
|
(2,522
|
)
|
|
(6,496
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
975
|
|
|
3,496
|
|
|
9,992
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
1,207
|
|
|
$
|
975
|
|
|
$
|
3,496
|
|
|
|
Estimated useful life
|
|
2019
|
|
2018
|
||||
Land and land improvements
|
|
20
|
|
$
|
3,507
|
|
|
$
|
3,593
|
|
Buildings and building improvements
|
|
3 to 50
|
|
8,023
|
|
|
7,874
|
|
||
Fixtures and equipment
|
|
3 to 20
|
|
9,786
|
|
|
9,750
|
|
||
Capitalized system development costs and software
|
|
3 to 8
|
|
2,770
|
|
|
2,464
|
|
||
Capital lease properties
|
|
|
|
703
|
|
|
743
|
|
||
|
|
|
|
24,789
|
|
|
24,424
|
|
||
Less: accumulated depreciation and amortization
|
|
|
|
11,310
|
|
|
10,513
|
|
||
Balance at end of year
|
|
|
|
$
|
13,478
|
|
|
$
|
13,911
|
|
•
|
Changes in the fair value of a derivative designated as a fair value hedge, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in the Consolidated Statements of Earnings in the same line item, generally interest expense, net.
|
•
|
Changes in the fair value of a derivative designated as a cash flow hedge are recorded in accumulated other comprehensive income (loss) in the Consolidated Statements of Comprehensive Income and reclassified into earnings in the period or periods during which the hedged item affects earnings and is presented in the same line item as the earnings effect of the hedged item.
|
•
|
Changes in the fair value of a derivative designated as a hedge of a net investment in a foreign operation are recorded in cumulative translation adjustments within accumulated other comprehensive income (loss) in the Consolidated Statements of Comprehensive Income. Recognition in earnings of amounts previously recorded in cumulative translation adjustments is limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged investments in foreign operations.
|
•
|
Changes in the fair value of a derivative not designated in a hedging relationship are recognized in the Consolidated Statements of Earnings.
|
|
As reported
|
|
Adjustments
|
|
As revised
|
||||||
Twelve months ended August 31, 2018
|
|
|
|
|
|
|
|
|
|||
Selling, general and administrative expenses
|
$
|
24,569
|
|
|
$
|
125
|
|
|
$
|
24,694
|
|
Operating income
|
6,414
|
|
|
(125
|
)
|
|
6,289
|
|
|||
Other income (expense)
|
177
|
|
|
125
|
|
|
302
|
|
|||
Twelve months ended August 31, 2017
|
|
|
|
|
|
||||||
Selling, general and administrative expenses
|
$
|
23,740
|
|
|
$
|
73
|
|
|
$
|
23,813
|
|
Operating income
|
5,557
|
|
|
(73
|
)
|
|
5,484
|
|
|||
Other income (expense)
|
(11
|
)
|
|
73
|
|
|
62
|
|
|
As reported
|
|
Adjustments
|
|
As revised
|
||||||
Twelve months ended August 31, 2018
|
|
|
|
|
|
|
|
|
|||
Trade accounts payable
|
$
|
1,323
|
|
|
$
|
29
|
|
|
$
|
1,352
|
|
Accrued expenses and other liabilities
|
281
|
|
|
6
|
|
|
287
|
|
|||
Other non-current assets and liabilities
|
(275
|
)
|
|
(36
|
)
|
|
(311
|
)
|
|||
Net cash provided by operating activities
|
8,265
|
|
|
(2
|
)
|
|
8,263
|
|
|||
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
15
|
|
|
(4
|
)
|
|
11
|
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(2,516
|
)
|
|
(6
|
)
|
|
(2,522
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
3,301
|
|
|
195
|
|
|
3,496
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
785
|
|
|
$
|
190
|
|
|
$
|
975
|
|
|
As reported
|
|
Adjustments
|
|
As revised
|
||||||
Twelve months ended August 31, 2017
|
|
|
|
|
|
|
|
|
|||
Trade accounts payable
|
$
|
1,690
|
|
|
$
|
(6
|
)
|
|
$
|
1,684
|
|
Accrued expenses and other liabilities
|
(128
|
)
|
|
—
|
|
|
(128
|
)
|
|||
Other non-current assets and liabilities
|
67
|
|
|
10
|
|
|
77
|
|
|||
Net cash provided by operating activities
|
7,251
|
|
|
4
|
|
|
7,255
|
|
|||
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
20
|
|
|
6
|
|
|
26
|
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(6,506
|
)
|
|
10
|
|
|
(6,496
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
9,807
|
|
|
185
|
|
|
9,992
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
3,301
|
|
|
$
|
195
|
|
|
$
|
3,496
|
|
Consideration
|
$
|
4,330
|
|
|
|
||
Identifiable assets acquired and liabilities assumed
|
|
||
Inventories
|
$
|
1,171
|
|
Property, plant and equipment
|
490
|
|
|
Intangible assets
|
2,039
|
|
|
Accrued expenses and other liabilities
|
(55
|
)
|
|
Deferred income taxes
|
291
|
|
|
Other non-current liabilities
|
(937
|
)
|
|
Total identifiable net assets
|
$
|
2,999
|
|
Goodwill
|
$
|
1,331
|
|
Definite-lived intangible assets
|
Weighted-average useful life (in years)
|
Amount (in millions)
|
||
Customer relationships
|
12
|
$
|
1,800
|
|
Favorable lease interests
|
10
|
219
|
|
|
Trade names
|
2
|
20
|
|
|
Total
|
|
$
|
2,039
|
|
(in millions)
|
20181
|
|
2017
|
||||
Sales
|
$
|
135,503
|
|
|
$
|
127,893
|
|
1
|
Impacted by store closures due to the Store Optimization Program.
|
(in millions)
|
2018
|
||
Sales
|
$
|
5,112
|
|
Total consideration
|
$
|
720
|
|
|
|
||
Identifiable assets acquired and liabilities assumed
|
|
||
Accounts receivable
|
$
|
217
|
|
Inventories
|
149
|
|
|
Property, plant and equipment
|
11
|
|
|
Intangible assets
|
331
|
|
|
Trade accounts payable
|
(90
|
)
|
|
Accrued expenses and other liabilities
|
(1
|
)
|
|
Total identifiable net assets
|
617
|
|
|
Goodwill
|
$
|
103
|
|
Twelve Months Ended August 31, 2019
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Walgreens Boots Alliance, Inc.
|
||||||||
Lease obligations and other real estate costs
|
$
|
5
|
|
|
$
|
19
|
|
|
$
|
1
|
|
|
$
|
25
|
|
Asset impairment1
|
95
|
|
|
67
|
|
|
98
|
|
|
260
|
|
||||
Employee severance and business transition costs
|
42
|
|
|
34
|
|
|
49
|
|
|
125
|
|
||||
Information technology transformation and other exit costs
|
5
|
|
|
10
|
|
|
7
|
|
|
22
|
|
||||
Total pre-tax exit and disposal charges
|
$
|
147
|
|
|
$
|
130
|
|
|
$
|
154
|
|
|
$
|
432
|
|
1
|
Primarily includes write down of leasehold improvements, certain software and inventory.
|
|
|
Employee severance and other exit costs
|
|
Asset Impairments
|
|
Lease obligations and other real estate costs
|
|
Information technology transformation and other exit costs
|
|
Total
|
||||||||||
Balance at August 31, 2018
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Costs
|
|
125
|
|
|
260
|
|
|
25
|
|
|
22
|
|
|
432
|
|
|||||
Payments
|
|
(69
|
)
|
|
—
|
|
|
(8
|
)
|
|
(13
|
)
|
|
(90
|
)
|
|||||
Other - non cash
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|
(6
|
)
|
|
(265
|
)
|
|||||
Currency translation adjustments
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Balance at August 31, 2019
|
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
4
|
|
|
$
|
78
|
|
|
2019
|
|
2018
|
||||
Lease obligations and other real estate costs
|
$
|
119
|
|
|
$
|
19
|
|
Employee severance and other exit costs
|
77
|
|
|
81
|
|
||
Total costs
|
$
|
196
|
|
|
$
|
100
|
|
|
Lease obligations and other real estate costs
|
|
Employee severance and other exit costs
|
|
Total
|
||||||
Balance at August 31, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Costs
|
19
|
|
|
81
|
|
|
100
|
|
|||
Payments
|
(18
|
)
|
|
(60
|
)
|
|
(78
|
)
|
|||
Other - non cash1
|
307
|
|
|
—
|
|
|
307
|
|
|||
Balance at August 31, 2018
|
$
|
308
|
|
|
$
|
21
|
|
|
$
|
329
|
|
Costs
|
119
|
|
|
77
|
|
|
196
|
|
|||
Payments
|
(171
|
)
|
|
(69
|
)
|
|
(240
|
)
|
|||
Other - non cash1
|
152
|
|
|
(7
|
)
|
|
144
|
|
|||
Balance at August 31, 2019
|
$
|
407
|
|
|
$
|
22
|
|
|
$
|
429
|
|
1
|
Primarily represents unfavorable lease liabilities from acquired Rite Aid stores.
|
|
Real estate costs
|
|
Severance and other business transition and exit costs
|
|
Total
|
||||||
Balance at August 31, 2017
|
$
|
521
|
|
|
$
|
79
|
|
|
$
|
600
|
|
Payments
|
(139
|
)
|
|
(68
|
)
|
|
(207
|
)
|
|||
Other - non cash
|
32
|
|
|
(3
|
)
|
|
29
|
|
|||
Currency translation adjustments
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Balance at August 31, 2018
|
$
|
414
|
|
|
$
|
7
|
|
|
$
|
421
|
|
Payments
|
(86
|
)
|
|
(4
|
)
|
|
(90
|
)
|
|||
Other - non cash
|
59
|
|
|
—
|
|
|
59
|
|
|||
Balance at August 31, 2019
|
$
|
387
|
|
|
$
|
3
|
|
|
$
|
390
|
|
Fiscal year ended 2017
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Walgreens Boots Alliance, Inc.
|
||||||||
Asset impairments
|
$
|
272
|
|
|
$
|
21
|
|
|
$
|
2
|
|
|
$
|
295
|
|
Real estate costs
|
372
|
|
|
—
|
|
|
—
|
|
|
372
|
|
||||
Severance and other business transition and exit costs
|
87
|
|
|
46
|
|
|
35
|
|
|
168
|
|
||||
Total costs
|
$
|
731
|
|
|
$
|
67
|
|
|
$
|
37
|
|
|
$
|
835
|
|
|
Finance lease obligation
|
|
Capital lease
|
|
Operating lease1
|
||||||
2020
|
$
|
21
|
|
|
$
|
59
|
|
|
$
|
3,484
|
|
2021
|
21
|
|
|
60
|
|
|
3,323
|
|
|||
2022
|
20
|
|
|
58
|
|
|
3,124
|
|
|||
2023
|
20
|
|
|
57
|
|
|
2,943
|
|
|||
2024
|
20
|
|
|
58
|
|
|
2,771
|
|
|||
Later
|
209
|
|
|
801
|
|
|
16,623
|
|
|||
Total minimum lease payments
|
$
|
311
|
|
|
$
|
1,093
|
|
|
$
|
32,268
|
|
1
|
Includes $1.6 billion of minimum rental commitments on closed locations
|
|
|
2019
|
|
2018
|
||||
Balance at beginning of period
|
|
$
|
964
|
|
|
$
|
718
|
|
Provision for present value of non-cancelable lease payments on closed facilities
|
|
90
|
|
|
52
|
|
||
Changes in assumptions
|
|
56
|
|
|
19
|
|
||
Accretion expense
|
|
39
|
|
|
58
|
|
||
Other - non cash1
|
|
160
|
|
|
338
|
|
||
Cash payments, net of sublease income
|
|
(316
|
)
|
|
(221
|
)
|
||
Balance at end of period
|
|
$
|
993
|
|
|
$
|
964
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Minimum rentals
|
|
$
|
3,622
|
|
|
$
|
3,447
|
|
|
$
|
3,259
|
|
Contingent rentals
|
|
74
|
|
|
68
|
|
|
59
|
|
|||
Less: sublease rental income
|
|
(66
|
)
|
|
(67
|
)
|
|
(55
|
)
|
|||
|
|
$
|
3,631
|
|
|
$
|
3,448
|
|
|
$
|
3,263
|
|
|
|
2019
|
|
2018
|
||||||||
|
|
Carrying value
|
|
Ownership percentage
|
|
Carrying value
|
|
Ownership percentage
|
||||
AmerisourceBergen
|
|
$
|
5,211
|
|
|
27%
|
|
$
|
5,138
|
|
|
26%
|
Others
|
|
1,640
|
|
|
8% - 50%
|
|
1,472
|
|
|
8% - 50%
|
||
Total
|
|
$
|
6,851
|
|
|
|
|
$
|
6,610
|
|
|
|
|
Year ended August 31,
|
||||||
|
2019
|
|
2018
|
||||
Current assets
|
$
|
36,523
|
|
|
$
|
34,493
|
|
Non-current assets
|
15,710
|
|
|
14,971
|
|
||
Current liabilities
|
35,857
|
|
|
34,055
|
|
||
Non-current liabilities
|
9,633
|
|
|
8,759
|
|
||
Shareholders’ equity1
|
6,743
|
|
|
6,650
|
|
|
Year ended August 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
$
|
197,237
|
|
|
$
|
179,887
|
|
|
$
|
164,844
|
|
Gross profit
|
7,516
|
|
|
6,875
|
|
|
5,958
|
|
|||
Net earnings
|
1,037
|
|
|
1,315
|
|
|
1,040
|
|
|||
Share of earnings from equity method investments
|
187
|
|
|
245
|
|
|
143
|
|
1
|
Shareholders’ equity at August 31, 2019 and 2018 includes $411 million and $445 million, respectively, related to noncontrolling interests.
|
|
|
Retail Pharmacy USA
|
|
Retail Pharmacy International
|
|
Pharmaceutical Wholesale
|
|
Walgreens Boots Alliance, Inc.
|
||||||||
August 31, 2017
|
|
$
|
9,139
|
|
|
$
|
3,392
|
|
|
$
|
3,101
|
|
|
$
|
15,632
|
|
Acquisitions
|
|
1,344
|
|
|
—
|
|
|
4
|
|
|
1,348
|
|
||||
Currency translation adjustments
|
|
—
|
|
|
(22
|
)
|
|
(44
|
)
|
|
(66
|
)
|
||||
August 31, 2018
|
|
$
|
10,483
|
|
|
$
|
3,370
|
|
|
$
|
3,061
|
|
|
$
|
16,914
|
|
Acquisitions
|
|
8
|
|
|
—
|
|
|
—
|
|
|
8
|
|
||||
Dispositions
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
||||
Currency translation adjustments
|
|
—
|
|
|
(182
|
)
|
|
(171
|
)
|
|
(353
|
)
|
||||
August 31, 2019
|
|
$
|
10,491
|
|
|
$
|
3,179
|
|
|
$
|
2,890
|
|
|
$
|
16,560
|
|
|
August 31, 2019
|
|
August 31, 2018
|
||||
Gross amortizable intangible assets
|
|
|
|
||||
Customer relationships and loyalty card holders1
|
$
|
4,290
|
|
|
$
|
4,235
|
|
Favorable lease interests and non-compete agreements
|
654
|
|
|
680
|
|
||
Trade names and trademarks
|
461
|
|
|
489
|
|
||
Purchasing and payer contracts
|
382
|
|
|
390
|
|
||
Total gross amortizable intangible assets
|
5,787
|
|
|
5,794
|
|
||
|
|
|
|
||||
Accumulated amortization
|
|
|
|
|
|
||
Customer relationships and loyalty card holders1
|
$
|
1,262
|
|
|
$
|
997
|
|
Favorable lease interests and non-compete agreements
|
410
|
|
|
359
|
|
||
Trade names and trademarks
|
250
|
|
|
206
|
|
||
Purchasing and payer contracts
|
99
|
|
|
78
|
|
||
Total accumulated amortization
|
2,021
|
|
|
1,640
|
|
||
Total amortizable intangible assets, net
|
$
|
3,766
|
|
|
$
|
4,154
|
|
|
|
|
|
||||
Indefinite-lived intangible assets
|
|
|
|
|
|
||
Trade names and trademarks
|
$
|
5,232
|
|
|
$
|
5,557
|
|
Pharmacy licenses
|
1,878
|
|
|
2,072
|
|
||
Total indefinite-lived intangible assets
|
$
|
7,110
|
|
|
$
|
7,629
|
|
|
|
|
|
||||
Total intangible assets, net
|
$
|
10,876
|
|
|
$
|
11,783
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
||||||||||
Estimated annual amortization expense
|
|
$
|
478
|
|
|
$
|
433
|
|
|
$
|
412
|
|
|
$
|
378
|
|
|
$
|
357
|
|
|
August 31, 2019
|
|
August 31, 2018
|
||||
Short-term debt 1
|
|
|
|
||||
Commercial paper
|
$
|
2,400
|
|
|
$
|
430
|
|
Credit facilities2
|
1,624
|
|
|
999
|
|
||
$8 billion note issuance3,4
|
|
|
|
||||
2.700% unsecured notes due 2019
|
1,250
|
|
|
—
|
|
||
$1 billion note issuance5
|
|
|
|
|
|
||
5.250% unsecured notes due 20196
|
—
|
|
|
249
|
|
||
Other7
|
464
|
|
|
288
|
|
||
Total short-term debt
|
$
|
5,738
|
|
|
$
|
1,966
|
|
Long-term debt 1
|
|
|
|
|
|
||
$6 billion note issuance3,4
|
|
|
|
||||
3.450% unsecured notes due 2026
|
$
|
1,890
|
|
|
$
|
1,888
|
|
4.650% unsecured notes due 2046
|
591
|
|
|
590
|
|
||
$8 billion note issuance3,4
|
|
|
|
||||
2.700% unsecured notes due 2019
|
—
|
|
|
1,248
|
|
||
3.300% unsecured notes due 2021
|
1,247
|
|
|
1,245
|
|
||
3.800% unsecured notes due 2024
|
1,992
|
|
|
1,990
|
|
||
4.500% unsecured notes due 2034
|
495
|
|
|
495
|
|
||
4.800% unsecured notes due 2044
|
1,492
|
|
|
1,492
|
|
||
£700 million note issuance3,4
|
|
|
|
||||
2.875% unsecured Pound sterling notes due 2020
|
488
|
|
|
517
|
|
||
3.600% unsecured Pound sterling notes due 2025
|
365
|
|
|
387
|
|
||
€750 million note issuance3,4
|
|
|
|
||||
2.125% unsecured Euro notes due 2026
|
824
|
|
|
868
|
|
||
$4 billion note issuance3,5
|
|
|
|
||||
3.100% unsecured notes due 2022
|
1,197
|
|
|
1,196
|
|
||
4.400% unsecured notes due 2042
|
493
|
|
|
492
|
|
||
Other8
|
25
|
|
|
23
|
|
||
Total long-term debt, less current portion
|
$
|
11,098
|
|
|
$
|
12,431
|
|
1
|
Carrying values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated debt has been translated using the spot rates at August 31, 2019 and 2018, respectively.
|
2
|
Credit facilities primarily include debt outstanding under the various credit facilities described in more detail below.
|
3
|
The $6 billion, $8 billion, £0.7 billion, €0.75 billion, and $4 billion note issuances as of August 31, 2019 had a fair value and carrying value of $2.6 billion and $2.5 billion, $6.8 billion and $6.5 billion, $0.9 billion and $0.9 billion, $0.9 billion and $0.8 billion, $1.7 billion and $1.7 billion, respectively. The fair values of the notes outstanding are Level 1 fair value
|
4
|
Notes are unsubordinated debt obligations of Walgreens Boots Alliance and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance from time to time outstanding.
|
5
|
Notes are senior debt obligations of Walgreen Co. and rank equally with all other unsecured and unsubordinated indebtedness of Walgreen Co. On December 31, 2014, Walgreens Boots Alliance fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of Walgreens Boots Alliance and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance.
|
6
|
Includes interest rate swap fair market value adjustments. See note 9, fair value measurements, for additional fair value disclosures.
|
7
|
Other short-term debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies.
|
8
|
Other long-term debt represents a mix of fixed and variable rate debt in various currencies with various maturities.
|
|
Amount
|
||
2020
|
$
|
5,752
|
|
2021
|
491
|
|
|
2022
|
1,250
|
|
|
2023
|
1,200
|
|
|
2024
|
—
|
|
|
Later
|
8,223
|
|
|
Total estimated future maturities
|
$
|
16,916
|
|
August 31, 2019
|
|
Notional
|
|
Fair value
|
|
Location in Consolidated Balance Sheets
|
||||
Derivatives designated as hedges:
|
|
|
|
|
|
|
||||
Cross currency interest rate swap
|
|
$
|
800
|
|
|
$
|
73
|
|
|
Other non-current assets
|
Foreign currency forwards
|
|
18
|
|
|
1
|
|
|
Other current assets
|
||
Derivatives not designated as hedges:
|
|
|
|
|
|
|
|
|
||
Foreign currency forwards
|
|
3,485
|
|
|
87
|
|
|
Other current assets
|
||
Foreign currency forwards
|
|
707
|
|
|
6
|
|
|
Other current liabilities
|
August 31, 2018
|
|
Notional
|
|
Fair value
|
|
Location in Consolidated Balance Sheets
|
||||
Derivatives designated as hedges:
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
$
|
250
|
|
|
$
|
1
|
|
|
Other non-current liabilities
|
Foreign currency forwards
|
|
$
|
15
|
|
|
—
|
|
|
Other current assets
|
|
Derivatives not designated as hedges:
|
|
|
|
|
|
|
|
|
||
Foreign currency forwards
|
|
3,273
|
|
|
52
|
|
|
Other current assets
|
||
Foreign currency forwards
|
|
825
|
|
|
4
|
|
|
Other current liabilities
|
|
|
Location in Consolidated Statements of Earnings
|
|
2019
|
|
2018
|
|
2017
|
||||||
Foreign currency forwards
|
|
Selling, general and administrative expense
|
|
$
|
139
|
|
|
$
|
17
|
|
|
$
|
11
|
|
Foreign currency forwards
|
|
Other income (expense)
|
|
(18
|
)
|
|
22
|
|
|
(48
|
)
|
Level 1 -
|
Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
|
Level 2 -
|
Observable inputs other than quoted prices in active markets.
|
Level 3 -
|
Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to Level 3 inputs.
|
|
|
August 31, 2019
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds1
|
|
$
|
217
|
|
|
$
|
217
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investments in equity securities2
|
|
5
|
|
|
5
|
|
|
—
|
|
|
—
|
|
||||
Foreign currency forwards3
|
|
88
|
|
|
—
|
|
|
88
|
|
|
—
|
|
||||
Cross Currency interest rate swaps4
|
|
73
|
|
|
—
|
|
|
73
|
|
|
—
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign currency forwards3
|
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
|
August 31, 2018
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds1
|
|
$
|
227
|
|
|
$
|
227
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Available-for-sale investments2
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Foreign currency forwards3
|
|
52
|
|
|
—
|
|
|
52
|
|
|
—
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps4
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Foreign currency forwards3
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
1
|
Money market funds are valued at the closing price reported by the fund sponsor.
|
2
|
Fair values of quoted investments are based on current bid prices as of August 31, 2019 and 2018.
|
3
|
The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates.
|
4
|
The fair value of interest rate swaps and cross currency interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See note 8, financial instruments, for additional information.
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
U.S.
|
|
$
|
1,898
|
|
|
$
|
3,292
|
|
|
$
|
1,953
|
|
Non–U.S.
|
|
2,629
|
|
|
2,683
|
|
|
2,900
|
|
|||
Total
|
|
$
|
4,527
|
|
|
$
|
5,975
|
|
|
$
|
4,853
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current provision
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
201
|
|
|
$
|
866
|
|
|
$
|
759
|
|
State
|
|
46
|
|
|
103
|
|
|
45
|
|
|||
Non–U.S.
|
|
241
|
|
|
353
|
|
|
390
|
|
|||
|
|
488
|
|
|
1,322
|
|
|
1,194
|
|
|||
Deferred provision
|
|
|
|
|
|
|
|
|
|
|||
Federal – tax law change
|
|
—
|
|
|
(648
|
)
|
|
—
|
|
|||
Federal – excluding tax law change
|
|
151
|
|
|
304
|
|
|
(306
|
)
|
|||
State
|
|
4
|
|
|
78
|
|
|
(24
|
)
|
|||
Non–U.S. – tax law change
|
|
—
|
|
|
—
|
|
|
(80
|
)
|
|||
Non–U.S. – excluding tax law change
|
|
(55
|
)
|
|
(58
|
)
|
|
(24
|
)
|
|||
|
|
100
|
|
|
(324
|
)
|
|
(434
|
)
|
|||
Income tax provision
|
|
$
|
588
|
|
|
$
|
998
|
|
|
$
|
760
|
|
|
|
2019
|
|
2018
|
|
2017
|
|||
Federal statutory rate
|
|
21.0
|
%
|
|
25.7
|
%
|
|
35.0
|
%
|
State income taxes, net of federal benefit
|
|
0.9
|
|
|
2.3
|
|
|
0.3
|
|
Foreign income taxed at non-U.S. rates
|
|
(2.1
|
)
|
|
(12.2
|
)
|
|
(11.8
|
)
|
Non-taxable income
|
|
(3.5
|
)
|
|
(5.2
|
)
|
|
(5.3
|
)
|
Non-deductible expenses
|
|
0.5
|
|
|
2.1
|
|
|
1.5
|
|
Transition tax
|
|
—
|
|
|
12.4
|
|
|
—
|
|
Tax law changes
|
|
(0.4
|
)
|
|
(10.9
|
)
|
|
(1.6
|
)
|
Change in valuation allowance1
|
|
1.9
|
|
|
8.7
|
|
|
0.7
|
|
Tax credits
|
|
(4.8
|
)
|
|
(6.9
|
)
|
|
(2.9
|
)
|
Other
|
|
(0.5
|
)
|
|
0.7
|
|
|
(0.2
|
)
|
Effective income tax rate
|
|
13.0
|
%
|
|
16.7
|
%
|
|
15.7
|
%
|
|
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Compensation and benefits
|
|
133
|
|
|
152
|
|
||
Insurance
|
|
90
|
|
|
74
|
|
||
Accrued rent
|
|
219
|
|
|
271
|
|
||
Allowance for doubtful accounts
|
|
13
|
|
|
27
|
|
||
Tax attributes
|
|
6,687
|
|
|
2,351
|
|
||
Stock compensation
|
|
45
|
|
|
44
|
|
||
Deferred income
|
|
115
|
|
|
110
|
|
||
Other
|
|
78
|
|
|
44
|
|
||
|
|
7,380
|
|
|
3,073
|
|
||
Less: valuation allowance
|
|
6,638
|
|
|
2,226
|
|
||
Total deferred tax assets
|
|
742
|
|
|
847
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
|
||
Accelerated depreciation
|
|
475
|
|
|
603
|
|
||
Inventory
|
|
394
|
|
|
301
|
|
||
Intangible assets
|
|
1,116
|
|
|
1,234
|
|
||
Equity method investment
|
|
481
|
|
|
459
|
|
||
|
|
2,466
|
|
|
2,597
|
|
||
Net deferred tax liabilities
|
|
$
|
1,724
|
|
|
$
|
1,750
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of year
|
|
$
|
456
|
|
|
$
|
409
|
|
|
$
|
269
|
|
Gross increases related to tax positions in a prior period
|
|
33
|
|
|
123
|
|
|
151
|
|
|||
Gross decreases related to tax positions in a prior period
|
|
(53
|
)
|
|
(15
|
)
|
|
(36
|
)
|
|||
Gross increases related to tax positions in the current period
|
|
26
|
|
|
29
|
|
|
33
|
|
|||
Settlements with taxing authorities
|
|
(2
|
)
|
|
(87
|
)
|
|
(2
|
)
|
|||
Currency
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||
Lapse of statute of limitations
|
|
(5
|
)
|
|
(3
|
)
|
|
(5
|
)
|
|||
Balance at end of year
|
|
$
|
455
|
|
|
$
|
456
|
|
|
$
|
409
|
|
|
|
August 31, 2019
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||
Equity securities1
|
|
$
|
1,006
|
|
|
$
|
—
|
|
|
$
|
1,005
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed interest government bonds2
|
|
489
|
|
|
148
|
|
|
341
|
|
|
—
|
|
||||
Index linked government bonds2
|
|
3,861
|
|
|
3,824
|
|
|
37
|
|
|
—
|
|
||||
Corporate bonds3
|
|
2,390
|
|
|
1
|
|
|
2,389
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
||||||
Real estate4
|
|
471
|
|
|
—
|
|
|
—
|
|
|
471
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other investments5
|
|
914
|
|
|
63
|
|
|
516
|
|
|
335
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Total
|
|
$
|
9,131
|
|
|
$
|
4,036
|
|
|
$
|
4,288
|
|
|
$
|
806
|
|
|
|
August 31, 2018
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||
Equity securities1
|
|
$
|
1,030
|
|
|
$
|
—
|
|
|
$
|
1,030
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed interest government bonds2
|
|
901
|
|
|
—
|
|
|
901
|
|
|
—
|
|
||||
Index linked government bonds2
|
|
2,880
|
|
|
—
|
|
|
2,880
|
|
|
—
|
|
||||
Corporate bonds3
|
|
2,542
|
|
|
—
|
|
|
2,536
|
|
|
6
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Real estate4
|
|
501
|
|
|
—
|
|
|
—
|
|
|
501
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other investments5
|
|
822
|
|
|
64
|
|
|
531
|
|
|
227
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Total
|
|
$
|
8,676
|
|
|
$
|
64
|
|
|
$
|
7,878
|
|
|
$
|
734
|
|
1
|
Equity securities, which mainly comprise investments in commingled funds, are valued based on quoted prices and are primarily exchange-traded. Securities for which official close or last trade pricing on an active exchange is available are classified as Level 1 investments. If closing prices are not available, or the investments are in a commingled fund,
|
2
|
Debt securities: government bonds comprise fixed interest and index linked bonds issued by central governments and are valued based on quotes received from independent pricing services or from dealers who make markets in such securities. Pricing services utilize pricing which considers readily available inputs such as the yield or price of bonds of comparable quality, coupon, maturity and type, as well as dealer-supplied prices. Certain government bonds which were categorized as Level 2 investments in fiscal 2018 were deemed to be classified as Level 1 in fiscal 2019.
|
3
|
Debt securities: corporate bonds comprise bonds issued by corporations in both segregated and commingled funds
|
4
|
Real estate comprises investments in certain property funds which are valued based on the underlying properties. These properties are valued using a number of standard industry techniques such as cost, discounted cash flows, independent appraisals and market based comparable data. Real estate investments are categorized as Level 3 investments. Changes in Level 3 investments during fiscal 2019 were driven by actual return on plan assets still held at August 31, 2019 and purchases during the year.
|
5
|
Other investments mainly comprise cash and cash equivalents, derivatives and direct private placements. Cash is categorized as a Level 1 investment and cash in commingled funds is categorized as Level 2 investments. Cash equivalents are valued using observable yield curves, discounting and interest rates and are categorized as Level 2 investments. Derivatives which are exchange-traded and for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market, or exchange on which they are traded, and are categorized as Level 1 investments. Over-the-counter derivatives typically are valued by independent pricing services and are categorized as Level 2 investments. Direct private placements are typically bonds valued by reference to comparable bonds and are categorized as Level 3 investments. Changes in Level 3 investments during fiscal 2019 were primarily driven by purchases during the year.
|
|
|
Boots and other pension plans
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Service costs
|
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
5
|
|
Interest costs
|
|
196
|
|
|
193
|
|
|
174
|
|
|||
Expected returns on plan assets/other
|
|
(246
|
)
|
|
(209
|
)
|
|
(146
|
)
|
|||
Total net periodic pension (income) cost
|
|
$
|
(46
|
)
|
|
$
|
(11
|
)
|
|
$
|
33
|
|
|
|
2019
|
|
2018
|
||||
Benefit obligation at beginning of year
|
|
$
|
8,293
|
|
|
$
|
8,880
|
|
Service costs
|
|
4
|
|
|
5
|
|
||
Interest costs
|
|
196
|
|
|
193
|
|
||
Amendments/other
|
|
22
|
|
|
(4
|
)
|
||
Net actuarial loss (gain)
|
|
1,212
|
|
|
(466
|
)
|
||
Benefits paid
|
|
(363
|
)
|
|
(398
|
)
|
||
Currency translation adjustments
|
|
(530
|
)
|
|
83
|
|
||
Benefit obligation at end of year
|
|
$
|
8,834
|
|
|
$
|
8,293
|
|
|
|
2019
|
|
2018
|
||||
Plan assets at fair value at beginning of year
|
|
$
|
8,676
|
|
|
$
|
8,980
|
|
Employer contributions
|
|
38
|
|
|
65
|
|
||
Benefits paid
|
|
(363
|
)
|
|
(398
|
)
|
||
Return on assets/other
|
|
1,333
|
|
|
(55
|
)
|
||
Currency translation adjustments
|
|
(552
|
)
|
|
84
|
|
||
Plan assets at fair value at end of year
|
|
$
|
9,131
|
|
|
$
|
8,676
|
|
|
|
2019
|
|
2018
|
||||
Other non-current assets
|
|
$
|
486
|
|
|
$
|
554
|
|
Accrued expenses and other liabilities
|
|
(6
|
)
|
|
(7
|
)
|
||
Other non-current liabilities
|
|
(183
|
)
|
|
(164
|
)
|
||
Net asset (liability) recognized at end of year
|
|
$
|
297
|
|
|
$
|
383
|
|
|
|
2019
|
|
2018
|
||||
Net actuarial (gain) loss
|
|
$
|
92
|
|
|
$
|
(27
|
)
|
Prior service cost
|
|
24
|
|
|
—
|
|
||
Total
|
|
116
|
|
|
(27
|
)
|
|
|
2019
|
|
2018
|
||||
Projected benefit obligation
|
|
$
|
8,834
|
|
|
$
|
8,293
|
|
Accumulated benefit obligation
|
|
8,823
|
|
|
8,285
|
|
||
Fair value of plan assets
|
|
9,131
|
|
|
8,676
|
|
|
|
2019
|
|
2018
|
||
Weighted-average assumptions used to determine benefit obligations
|
|
|
|
|
||
Discount rate
|
|
1.80
|
%
|
|
2.67
|
%
|
Rate of compensation increase
|
|
2.91
|
%
|
|
2.68
|
%
|
|
|
|
|
|
||
Weighted-average assumptions used to determine net periodic benefit cost
|
|
|
|
|
|
|
Discount rate
|
|
1.58
|
%
|
|
2.12
|
%
|
Expected long-term return on plan assets
|
|
3.10
|
%
|
|
2.27
|
%
|
Rate of compensation increase
|
|
2.68
|
%
|
|
2.64
|
%
|
|
Pension/post-retirement obligations
|
|
Unrecognized gain (loss) on available-for-sale investments
|
|
Unrealized gain (loss) on cash flow hedges
|
|
Share of OCI of equity method investments
|
|
Cumulative translation adjustments
|
|
Total
|
||||||||||||
Balance at August 31, 2016
|
$
|
(212
|
)
|
|
$
|
2
|
|
|
$
|
(37
|
)
|
|
$
|
(1
|
)
|
|
$
|
(2,744
|
)
|
|
$
|
(2,992
|
)
|
Other comprehensive income (loss) before reclassification adjustments
|
(34
|
)
|
|
(2
|
)
|
|
—
|
|
|
(1
|
)
|
|
(133
|
)
|
|
(170
|
)
|
||||||
Amounts reclassified from AOCI1
|
109
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
114
|
|
||||||
Tax benefit (provision)
|
(2
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||||
Net change in other comprehensive income (loss)
|
73
|
|
|
(2
|
)
|
|
4
|
|
|
(1
|
)
|
|
(133
|
)
|
|
(59
|
)
|
||||||
Balance at August 31, 2017
|
$
|
(139
|
)
|
|
$
|
—
|
|
|
$
|
(33
|
)
|
|
$
|
(2
|
)
|
|
$
|
(2,877
|
)
|
|
$
|
(3,051
|
)
|
Other comprehensive income (loss) before reclassification adjustments
|
417
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(207
|
)
|
|
206
|
|
||||||
Amounts reclassified from AOCI1
|
(120
|
)
|
|
—
|
|
|
4
|
|
|
11
|
|
|
8
|
|
|
(97
|
)
|
||||||
Tax benefit (provision)
|
(57
|
)
|
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|
—
|
|
|
(60
|
)
|
||||||
Net change in other comprehensive income (loss)
|
240
|
|
|
—
|
|
|
3
|
|
|
5
|
|
|
(199
|
)
|
|
49
|
|
||||||
Balance at August 31, 2018
|
$
|
101
|
|
|
$
|
—
|
|
|
$
|
(30
|
)
|
|
$
|
3
|
|
|
$
|
(3,076
|
)
|
|
$
|
(3,002
|
)
|
Other comprehensive income (loss) before reclassification adjustments
|
(162
|
)
|
|
—
|
|
|
74
|
|
|
(1
|
)
|
|
(801
|
)
|
|
(889
|
)
|
||||||
Amounts reclassified from AOCI
|
(17
|
)
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
(12
|
)
|
||||||
Tax benefit (provision)
|
30
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
(6
|
)
|
|
5
|
|
||||||
Net change in other comprehensive income (loss)
|
(149
|
)
|
|
—
|
|
|
60
|
|
|
(1
|
)
|
|
(807
|
)
|
|
(896
|
)
|
||||||
Balance at August 31, 2019
|
$
|
(48
|
)
|
|
$
|
—
|
|
|
$
|
31
|
|
|
$
|
3
|
|
|
$
|
(3,884
|
)
|
|
$
|
(3,897
|
)
|
1
|
Includes amendment to U.S. postretirement healthcare plan resulting in a curtailment gain. See note 13, retirement benefits.
|
|
For the years ending August 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Sales:
|
|
|
|
|
|
||||||
Retail Pharmacy USA
|
$
|
104,532
|
|
|
$
|
98,392
|
|
|
$
|
87,302
|
|
Retail Pharmacy International
|
11,462
|
|
|
12,281
|
|
|
11,813
|
|
|||
Pharmaceutical Wholesale
|
23,053
|
|
|
23,006
|
|
|
21,188
|
|
|||
Eliminations1
|
(2,180
|
)
|
|
(2,142
|
)
|
|
(2,089
|
)
|
|||
Walgreens Boots Alliance, Inc.
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
Adjusted Operating income:2
|
|
|
|
|
|
||||||
Retail Pharmacy USA
|
$
|
5,255
|
|
|
$
|
5,814
|
|
|
$
|
5,606
|
|
Retail Pharmacy International
|
747
|
|
|
929
|
|
|
939
|
|
|||
Pharmaceutical Wholesale
|
939
|
|
|
936
|
|
|
922
|
|
|||
Eliminations1
|
1
|
|
|
|
|
|
|||||
Walgreens Boots Alliance, Inc.
|
$
|
6,942
|
|
|
$
|
7,679
|
|
|
$
|
7,467
|
|
Depreciation and amortization:
|
|
|
|
|
|
||||||
Retail Pharmacy USA
|
$
|
1,459
|
|
|
$
|
1,196
|
|
|
$
|
1,090
|
|
Retail Pharmacy International
|
429
|
|
|
419
|
|
|
414
|
|
|||
Pharmaceutical Wholesale
|
150
|
|
|
155
|
|
|
150
|
|
|||
Walgreens Boots Alliance, Inc.
|
$
|
2,038
|
|
|
$
|
1,770
|
|
|
$
|
1,654
|
|
Capital expenditures:
|
|
|
|
|
|
||||||
Retail Pharmacy USA
|
$
|
1,323
|
|
|
$
|
1,022
|
|
|
$
|
860
|
|
Retail Pharmacy International
|
275
|
|
|
241
|
|
|
384
|
|
|||
Pharmaceutical Wholesale
|
104
|
|
|
104
|
|
|
107
|
|
|||
Walgreens Boots Alliance, Inc.
|
$
|
1,702
|
|
|
$
|
1,367
|
|
|
$
|
1,351
|
|
|
For the years ending August 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Adjusted operating income2
|
$
|
6,942
|
|
|
$
|
7,679
|
|
|
$
|
7,467
|
|
Acquisition-related amortization and impairment3
|
(567
|
)
|
|
(448
|
)
|
|
(332
|
)
|
|||
Transformational cost management
|
(477
|
)
|
|
—
|
|
|
—
|
|
|||
Acquisition-related costs
|
(303
|
)
|
|
(231
|
)
|
|
(474
|
)
|
|||
Adjustments to equity earnings in AmerisourceBergen
|
(233
|
)
|
|
(175
|
)
|
|
(187
|
)
|
|||
Store optimization
|
(196
|
)
|
|
(100
|
)
|
|
—
|
|
|||
LIFO provision
|
(136
|
)
|
|
(84
|
)
|
|
(166
|
)
|
|||
Certain legal and regulatory accruals and settlements4
|
(31
|
)
|
|
(284
|
)
|
|
—
|
|
|||
Asset recovery
|
—
|
|
|
15
|
|
|
11
|
|
|||
Hurricane-related costs
|
—
|
|
|
(83
|
)
|
|
—
|
|
|||
Cost Transformation
|
—
|
|
|
—
|
|
|
(835
|
)
|
|||
Operating income2
|
$
|
4,998
|
|
|
$
|
6,289
|
|
|
$
|
5,484
|
|
1
|
Eliminations relate to intersegment sales between the Pharmaceutical Wholesale and the Retail Pharmacy International segments.
|
2
|
The Company adopted new accounting guidance in Accounting Standards Update 2017-07 as of September 1, 2018 (fiscal 2019) on a retrospective basis for the Consolidated Statements of Earnings presentation. See note 1, summary of major accounting policies, for further information.
|
3
|
Includes impairment of $73 million for indefinite-lived pharmacy licenses intangible asset recorded during the three months ended August 31, 2019, in the Boots reporting unit within the Retail Pharmacy International segment.
|
4
|
Beginning in the quarter ended August 31, 2018, management reviewed and refined its practice to include all charges related to the matters included in certain legal and regulatory accruals and settlements. This non-GAAP measure is presented on a consistent basis for fiscal year 2019.
|
|
2019
|
|
2018
|
|
2017
|
||||||
United States
|
$
|
104,532
|
|
|
$
|
98,392
|
|
|
$
|
87,302
|
|
United Kingdom
|
12,729
|
|
|
13,297
|
|
|
12,552
|
|
|||
Europe (excluding the United Kingdom)
|
17,009
|
|
|
17,594
|
|
|
16,224
|
|
|||
Other
|
2,597
|
|
|
2,254
|
|
|
2,136
|
|
|||
Sales
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
|
2019
|
|
2018
|
||||
United States
|
$
|
10,598
|
|
|
$
|
10,678
|
|
United Kingdom
|
2,162
|
|
|
2,458
|
|
||
Europe (excluding the United Kingdom)
|
521
|
|
|
576
|
|
||
Other
|
197
|
|
|
199
|
|
||
Total long-lived assets
|
$
|
13,478
|
|
|
$
|
13,911
|
|
|
|
For the years ending August 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Retail Pharmacy USA
|
|
|
|
|
|
|
||||||
Pharmacy
|
|
$
|
77,192
|
|
|
$
|
71,055
|
|
|
$
|
60,608
|
|
Retail
|
|
27,340
|
|
|
27,337
|
|
|
26,695
|
|
|||
Total
|
|
104,532
|
|
|
98,392
|
|
|
87,302
|
|
|||
|
|
|
|
|
|
|
||||||
Retail Pharmacy International
|
|
|
|
|
|
|
||||||
Pharmacy
|
|
4,080
|
|
|
4,360
|
|
|
4,180
|
|
|||
Retail
|
|
7,382
|
|
|
7,921
|
|
|
7,633
|
|
|||
Total
|
|
11,462
|
|
|
12,281
|
|
|
11,813
|
|
|||
|
|
|
|
|
|
|
||||||
Pharmaceutical Wholesale
|
|
23,053
|
|
|
23,006
|
|
|
21,188
|
|
|||
|
|
|
|
|
|
|
||||||
Eliminations1
|
|
(2,180
|
)
|
|
(2,142
|
)
|
|
(2,089
|
)
|
|||
|
|
|
|
|
|
|
||||||
Walgreens Boots Alliance, Inc.
|
|
$
|
136,866
|
|
|
$
|
131,537
|
|
|
$
|
118,214
|
|
1
|
Eliminations relate to intersegment sales between the Pharmaceutical Wholesale and the Retail Pharmacy International segments.
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Purchases, net
|
|
$
|
57,429
|
|
|
$
|
53,161
|
|
|
$
|
43,571
|
|
|
|
|
|
|
|
|
||||||
Trade accounts payable, net
|
|
$
|
6,484
|
|
|
$
|
6,274
|
|
|
$
|
4,384
|
|
|
|
|
Quarter ended
|
|
|
||||||||||||||||
|
|
|
November
|
|
February
|
|
May
|
|
August
|
|
Fiscal year
|
||||||||||
Fiscal 2019
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Sales
|
|
$
|
33,793
|
|
|
$
|
34,528
|
|
|
$
|
34,591
|
|
|
$
|
33,954
|
|
|
$
|
136,866
|
|
|
Gross profit
|
|
7,641
|
|
|
7,754
|
|
|
7,453
|
|
|
7,228
|
|
|
30,076
|
|
||||||
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
|
1,123
|
|
|
1,156
|
|
|
1,025
|
|
|
677
|
|
|
3,982
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
|
$
|
1.18
|
|
|
$
|
1.25
|
|
|
$
|
1.13
|
|
|
$
|
0.75
|
|
|
$
|
4.32
|
|
|
Diluted
|
|
1.18
|
|
|
1.24
|
|
|
1.13
|
|
|
0.75
|
|
|
4.31
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Cash dividends declared per common share
|
|
$
|
0.440
|
|
|
$
|
0.440
|
|
|
$
|
0.440
|
|
|
$
|
0.458
|
|
|
$
|
1.778
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fiscal 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Sales
|
|
$
|
30,740
|
|
|
$
|
33,021
|
|
|
$
|
34,334
|
|
|
$
|
33,442
|
|
|
$
|
131,537
|
|
|
Gross profit
|
|
7,341
|
|
|
8,096
|
|
|
7,780
|
|
|
7,575
|
|
|
30,792
|
|
||||||
Net earnings attributable to Walgreens Boots Alliance, Inc.
|
|
821
|
|
|
1,349
|
|
|
1,342
|
|
|
1,512
|
|
|
5,024
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
0.82
|
|
|
$
|
1.36
|
|
|
$
|
1.35
|
|
|
$
|
1.55
|
|
|
$
|
5.07
|
|
|
Diluted
|
|
0.81
|
|
|
1.36
|
|
|
1.35
|
|
|
1.55
|
|
|
5.05
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Cash dividends declared per common share
|
|
$
|
0.400
|
|
|
$
|
0.400
|
|
|
$
|
0.400
|
|
|
$
|
0.440
|
|
|
$
|
1.640
|
|
/s/
|
Stefano Pessina
|
|
/s/
|
James Kehoe
|
|
|
Stefano Pessina
|
|
|
James Kehoe
|
|
|
Executive Vice Chairman and Chief
Executive Officer
|
|
|
Executive Vice President and Global Chief
Financial Officer
|
|
•
|
We tested the effectiveness of controls over the goodwill and intangible asset impairment analyses, including those over the development of forecasts of future revenues, EBITDA margins, and the selection of royalty rates, market multiples, and discount rates.
|
•
|
We evaluated management’s ability to accurately forecast future revenues and EBITDA margins by comparing actual results to management’s historical forecasts.
|
•
|
We evaluated the reasonableness of management’s forecasts of future revenues and EBITDA margins by performing certain procedures, including:
|
–
|
Comparing the forecasts to internal communications to management and the Board of Directors.
|
–
|
Comparing the forecasts to third-party economic research, including discussions with our economic and industry specialists.
|
•
|
We performed sensitivity analyses to evaluate the risk of impairment if key assumptions are changed.
|
•
|
We evaluated, with the assistance of our fair value specialists, the (1) valuation methodology used for the Boots Reporting Unit goodwill and the Boots indefinite-lived intangible assets and (2) the reasonableness of the related discount rates, by performing certain procedures, including:
|
–
|
Comparing the valuation methodologies used to generally accepted valuation practices for each asset type.
|
–
|
Evaluating the appropriateness of the Company’s selection of companies in its industry comparable group for comparability to the Boots Reporting Unit.
|
–
|
Testing the source information underlying the determination of the discount rate and the mathematical accuracy of the calculation.
|
–
|
Developing an independent discount rate and comparing it to the discount rate selected by management.
|
•
|
We tested the effectiveness of controls over income taxes, including those over identifying uncertain tax positions and measuring liabilities.
|
•
|
We evaluated, with the assistance of our tax specialists, a selection of underlying tax positions to evaluate the more likely than not principle as it applied to the specific underlying tax position.
|
•
|
We evaluated, with the assistance of our tax specialists, the Company’s unrecognized tax positions by performing the following:
|
–
|
Obtaining management and third-party opinions or memoranda regarding the analysis of uncertain tax positions and identifying the key judgments and evaluating whether the analysis was consistent with our interpretation of the relevant laws and regulations.
|
–
|
Evaluating the basis for certain intercompany transactions, such as transfer pricing, by comparison to economic studies performed by management and third-party data.
|
–
|
Evaluating the matters raised by tax authorities in former and ongoing tax audits and considering the implications of these matters on open tax years.
|
–
|
Assessing changes and interpretation of applicable tax law.
|
(a)
|
Documents filed as part of this report:
|
(1)
|
Financial statements. The following financial statements, supplementary data and reports of independent public accountants appear in part II, item 8 of this Form 10-K and are incorporated herein by reference.
|
(2)
|
Financial statement schedules and supplementary information
|
(3)
|
Exhibits. Exhibits 10.1 through 10.62 constitute management contracts or compensatory plans or arrangements required to be filed as exhibits pursuant to Item 15(b) of this Form 10-K.
|
•
|
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
•
|
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
(b)
|
Exhibits
|
Exhibit
No.
|
Description
|
|
SEC Document Reference
|
2.1*
|
Purchase and Option Agreement by and among Walgreen Co., Alliance Boots GmbH and AB Acquisitions Holdings Limited dated June 18, 2012 and related annexes.
|
|
Incorporated by reference to Annex B-1 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
2.2*
|
Amendment No. 1 to Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, dated August 5, 2014, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Walgreen Scotland Investments LP, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
|
Incorporated by reference to Annex B-2 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
Agreement and Plan of Merger, dated October 17, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
|
Incorporated by reference to Annex A to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
|
Amendment No. 1 to Agreement and Plan of Merger, dated December 23, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
|
Incorporated by reference to Exhibit 2.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on December 24, 2014.
|
|
Amendment No. 2 to Agreement and Plan of Merger, dated December 29, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
|
Incorporated by reference to Exhibit 2.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2014 (File No. 1-36759) filed with the SEC on December 30, 2014.
|
|
2.6*
|
Amended and Restated Asset Purchase Agreement, dated as of September 18, 2017, by and among Walgreens Boots Alliance, Inc., Walgreen Co. and Rite Aid Corporation
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on September 19, 2017.
|
Amended and Restated Certificate of Incorporation of Walgreens Boots Alliance, Inc.
|
|
Incorporated by reference to Exhibit 3.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
Amended and Restated By-laws of Walgreens Boots Alliance, Inc.
|
|
Incorporated by reference to Exhibit 3.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 10, 2016.
|
|
4.1**
|
Indenture, dated as of July 17, 2008, between Walgreen Co. and Wells Fargo Bank, National Association, as trustee.
|
|
Incorporated by reference to Exhibit 4.3 to Walgreen Co.’s registration statement on Form S-3ASR (File No. 333-152315) filed with the SEC on July 14, 2008.
|
Form of Walgreen Co. 3.100% Note due 2022.
|
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on September 13, 2012.
|
|
Form of Walgreen Co. 4.400% Note due 2042.
|
|
Incorporated by reference to Exhibit 4.5 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on September 13, 2012.
|
|
Form of Guarantee of Walgreens Boots Alliance, Inc.
|
|
Incorporated by reference to Exhibit 4.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
Indenture dated November 18, 2014 among Walgreens Boots Alliance, Inc. and Wells Fargo Bank, National Association, as trustee.
|
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
Form of 2.700% Notes due 2019.
|
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
Form of 3.300% Notes due 2021.
|
|
Incorporated by reference to Exhibit 4.5 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
Form of 3.800% Notes due 2024.
|
|
Incorporated by reference to Exhibit 4.6 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
Form of 4.500% Notes due 2034.
|
|
Incorporated by reference to Exhibit 4.7 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
Form of 4.800% Notes due 2044.
|
|
Incorporated by reference to Exhibit 4.8 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
Form of 2.875% Notes due 2020 (£).
|
|
Incorporated by reference to Exhibit 4.2 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
Form of 3.600% Notes due 2025 (£).
|
|
Incorporated by reference to Exhibit 4.3 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
Form of 2.125% Notes due 2026 (€).
|
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
Indenture, dated as of December 17, 2015, between Walgreens Boots Alliance, Inc. and Wells Fargo Bank, National Association, as trustee
|
|
Incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-3 (File No. 333-208587) filed with the SEC on December 17, 2015.
|
|
Form of 3.450% Notes due 2026
|
|
Incorporated by reference to Exhibit 4.5 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
Form of 4.650% Notes due 2046
|
|
Incorporated by reference to Exhibit 4.6 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.17
|
Walgreen Co. Shareholders Agreement, dated as of August 2, 2012, among Walgreen Co., Stefano Pessina, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Kohlberg Kravis Roberts & Co. L.P. and certain other investors party thereto.
|
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 6, 2012.
|
4.18
|
Amendment No. 1 to Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, dated August 5, 2014, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Walgreen Scotland Investments LP, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
|
Incorporated by reference to Annex B-2 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
Amendment No. 2 to Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, dated December 31, 2014, as Amended by Amendment No. 1, dated as of August 5, 2014, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Ontario Holdings WBS Limited, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
|
Incorporated by reference to Exhibit E to the Schedule 13D filed by Alliance Santé Participations S.A. (File No. 005-88481) filed with the SEC on December 31, 2014).
|
|
Description of Registered Securities.
|
|
Filed herewith.
|
|
Walgreens Boots Alliance, Inc. Management Incentive Plan (as amended and restated effective July 1, 2016).
|
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2016 (File No. 1-36759) filed with the SEC on October 20, 2016.
|
|
Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan (as amended and restated).
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on January 19, 2018.
|
|
Form of Performance Share Award agreement (effective October 2019).
|
|
Filed herewith
|
|
Form of Performance Share Award agreement (effective October 2018).
|
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
Form of Performance Share Award agreement (effective October 2017).
|
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2017 (File No. 1-36759) filed with the SEC on October 25, 2017.
|
|
Form of Stock Option Award agreement (effective October 2019).
|
|
Filed herewith.
|
|
Form of Stock Option Award agreement (effective October 2018).
|
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
|
Form of Stock Option Award agreement (effective October 2017).
|
|
Incorporated by reference to Exhibit 10.7 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2017 (File No. 1-36759) filed with the SEC on October 25, 2017.
|
|
Form of Stock Option Award agreement (effective July 2016).
|
|
Incorporated by reference to Exhibit 10.8 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2016 (File No. 1-36759) filed with the SEC on October 20, 2016.
|
|
Form of Performance Share Award agreement for CEO (November 2019).
|
|
Filed herewith.
|
|
Form of Performance Share Award agreement for CEO (November 2018).
|
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
|
Form of Performance Share Award agreement for CEO (November 2017).
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2017 (File No. 1-36759) filed with the SEC on January 4, 2018.
|
|
Form of Performance Share Award agreement for CEO (November 2016).
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2016 (File No. 1-36759) filed with the SEC on January 5, 2017.
|
|
Form of Stock Option Award agreement for CEO (November 2019).
|
|
Filed herewith.
|
|
Form of Stock Option Award agreement for CEO (November 2018).
|
|
Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
|
Form of Stock Option Award agreement for CEO (November 2017).
|
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2017 (File No. 1-36759) filed with the SEC on January 4, 2018.
|
|
Form of Stock Option Award agreement for CEO (November 2016).
|
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2016 (File No. 1-36759) filed with the SEC on January 5, 2017.
|
|
Form of Restricted Stock Unit Award agreement for CEO (November 2019).
|
|
Filed herewith.
|
|
Form of Restricted Stock Unit Award agreement for Executive Chairman (November 2019).
|
|
Filed herewith.
|
|
Form of Restricted Stock Unit agreement (effective October 2019)
|
|
Filed herewith.
|
|
Form of Restricted Stock Unit Award agreement for Executive Chairman (November 2018).
|
|
Incorporated by reference to Exhibit 10.7 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
|
Form of Restricted Stock Unit Award agreement for Executive Chairman (November 2017).
|
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2017 (File No. 1-36759) filed with the SEC on January 4, 2018.
|
Form of Restricted Stock Unit Award agreement for Executive Chairman (November 2016).
|
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2016 (File No. 1-36759) filed with the SEC on January 5, 2017.
|
|
Form of Restricted Stock Unit Award agreement (September 2019).
|
|
Filed herewith.
|
|
Form of Restricted Stock Unit Award agreement for James Kehoe (June 2018).
|
|
Incorporated by reference to Exhibit 10.18 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 11, 2018.
|
|
Form of Amendment to Stock Option Award agreements.
|
|
Incorporated by reference to Exhibit 10.11 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2014 (File No. 1-00604) filed with the SEC on October 20, 2014.
|
|
Amendments to certain Omnibus Plan Award agreements (October 2018).
|
|
Incorporated by reference to Exhibit 10.7 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on October 26, 2018.
|
|
UK Sub-Plan under the Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan.
|
|
Incorporated by reference to Exhibit 10.16 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
Form of Stock Option Award agreement under UK Sub-plan (effective October 2019).
|
|
Filed herewith.
|
|
Form of Stock Option Award agreement under UK Sub-plan (effective October 2018).
|
|
Incorporated by reference to Exhibit 10.4 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2018 (File No. 1-36759) filed with the SEC on December 20, 2018.
|
|
Form of Stock Option Award agreement under UK Sub-plan (effective October 2017).
|
|
Incorporated by reference to Exhibit 10.24 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2017 (File No. 1-36759) filed with the SEC on October 25, 2017.
|
|
Form of Stock Option Award agreement under UK Sub-plan (effective July 2016).
|
|
Incorporated by reference to Exhibit 10.23 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2016 (File No. 1-36759) filed with the SEC on October 20, 2016.
|
|
Walgreen Co. Long-Term Performance Incentive Plan (amendment and restatement of the Walgreen Co. Restricted Performance Share Plan).
|
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 11, 2007.
|
|
Walgreen Co. Long-Term Performance Incentive Plan Amendment No. 1 (effective January 10, 2007).
|
|
Incorporated by reference to Exhibit 10.2 to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2007 (File No. 1-00604).
|
|
Walgreen Co. Long-Term Performance Incentive Plan Amendment No. 2.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on April 14, 2011.
|
|
Form of Restricted Stock Unit Award agreement (August 15, 2011 grants).
|
|
Incorporated by reference to Exhibit 10.5 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2011 (File No. 1-00604).
|
|
Walgreen Co. Executive Stock Option Plan (as amended and restated effective January 13, 2010).
|
|
Incorporated by reference to Exhibit 99.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 20, 2010.
|
|
Walgreen Co. 2002 Executive Deferred Compensation/Capital Accumulation Plan.
|
|
Incorporated by reference to Exhibit 10(g) to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2002 (File No. 1-00604).
|
|
Amendment to the Walgreen Co. 2002 et. al. Executive Deferred Compensation/Capital Accumulation Plans.
|
|
Incorporated by reference to Exhibit 10.3 to Walgreen Co.’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 28, 2009 (File No. 1-00604).
|
Walgreen Co. 2006 Executive Deferred Compensation/Capital Accumulation Plan (effective January 1, 2006).
|
|
Incorporated by reference to Exhibit 10(b) to Walgreen Co.’s Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 2005
(File No. 1-00604).
|
|
Walgreen Co. 2011 Executive Deferred Compensation Plan.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 12, 2010.
|
|
Amendment No. 1 to the Walgreen Co. 2011 Executive Deferred Compensation Plan.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 19, 2011.
|
|
Walgreens Boots Alliance, Inc. Executive Retirement Savings Plan (as amended and restated effective January 1, 2020).
|
|
Filed herewith.
|
|
Share Walgreens Stock Purchase/Option Plan (effective October 1, 1992), as amended.
|
|
Incorporated by reference to Exhibit 10(d) to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2003 (File No. 1-00604).
|
|
Share Walgreens Stock Purchase/Option Plan Amendment No. 4 (effective July 15, 2005), as amended.
|
|
Incorporated by reference to Exhibit 10(h)(ii) to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2005 (File No. 1-00604).
|
|
Share Walgreens Stock Purchase/Option Plan Amendment No. 5 (effective October 11, 2006).
|
|
Incorporated by reference to Exhibit 10(b) to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2006 (File No. 1-00604).
|
|
Walgreens Boots Alliance, Inc. Executive Severance and Change in Control Plan (as amended and restated effective August 6, 2019).
|
|
Filed herewith.
|
|
Offer Letter agreement between Stefano Pessina and Walgreens Boots Alliance, Inc.
|
|
Incorporated by reference to Exhibit 10.29 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Offer letter agreement dated as of March 6, 2018 between James Kehoe and Walgreens Boots Alliance, Inc.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on March 8, 2018.
|
|
Service Agreement between Boots UK Limited and Alex Gourlay, dated January 29, 2009.
|
|
Incorporated by reference to Exhibit 10.18 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Letter Agreement between Alliance Boots Management Services Limited and Alex Gourlay, dated June 28, 2010.
|
|
Incorporated by reference to Exhibit 10.19 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Employment Agreement between Alliance UniChem Plc and Ornella Barra dated December 10, 2002.
|
|
Incorporated by reference to Exhibit 10.20 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Agreement among Alliance Boots plc, Alliance UniChem Plc and Ornella Barra, dated July 31, 2006.
|
|
Incorporated by reference to Exhibit 10.21 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Novation of Service Agreement among Alliance Boots Holdings Limited, Alliance Boots Management Services MC S.A.M and Ornella Barra, dated June 1, 2013.
|
|
Incorporated by reference to Exhibit 10.22 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
Walgreens Boots Alliance, Inc. Long-Term Global Assignment Relocation Policy
|
|
Incorporated by reference to Exhibit 10.68 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
Secondment Agreement dated September 27, 2013 between Alliance Boots Management Services Limited and Walgreen Co.
|
|
Incorporated by reference to Exhibit 10.52 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2013 (File No. 1-00604).
|
|
Assignment Letter dated September 27, 2013 between Alexander Gourlay and Alliance Boots Management Services Ltd.
|
|
Incorporated by reference to Exhibit 10.53 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2013 (File No. 1-00604).
|
|
Extension, dated January 27, 2016, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited (formerly Alliance Boots Management Services Ltd.).
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on February 1, 2016.
|
|
Extension, dated as of March 27, 2017, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited (formerly Alliance Boots Management Services Ltd.).
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Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2017 (File No. 1-36759) filed with the SEC on April 5, 2017.
|
|
Extension, dated as of July 13, 2017, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited (formerly Alliance Boots Management Services Ltd.).
|
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Incorporated by reference to Exhibit 10.62 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2017 (File No. 1-36759) filed with the SEC on October 25, 2017.
|
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Extension, dated as of August 1, 2018, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited.
|
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Incorporated by reference to Exhibit 10.8 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on October 26, 2018.
|
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Extension, effective as of October 22, 2019, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited.
|
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Filed herewith.
|
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Shareholders’ Agreement, dated as of August 2, 2012, by and among Alliance Boots GmbH, AB Acquisition Holdings Limited and Walgreen Co.
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Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 6, 2012.
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Framework Agreement, dated as of March 18, 2013, by and among Walgreen Co., Alliance Boots GmbH and AmerisourceBergen Corporation.
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Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on March 20, 2013.
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Shareholders Agreement, dated as of March 18, 2013, by and among Walgreen Co., Alliance Boots GmbH and AmerisourceBergen Corporation.
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Incorporated by reference to Exhibit 10.2 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on March 20, 2013.
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Revolving Credit Agreement, dated as of August 29, 2018, by and among Walgreens Boots Alliance, Inc., the lenders and letter of credit issuers from time to time party thereto, Wells Fargo Bank, National Association, as administrative agent, and the joint lead arrangers, joint bookrunners and co-syndication.
|
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Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on August 30, 2018.
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Credit Agreement, dated as of November 30, 2018, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Sumitomo Mitsui Banking Corporation, as sole lead arranger and administrative agent.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 6, 2018.
|
|
Term Loan Credit Agreement, dated as of December 5, 2018, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Wells Fargo Bank, National Association, as administrative agent.
|
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Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 6, 2018.
|
|
Revolving Credit Agreement, dated as of December 21, 2018, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Bank of America, N.A., as administrative agent.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 26, 2018.
|
|
364-Day Revolving Credit Agreement, dated as of January 18, 2019, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Mizuho Bank, Ltd., as administrative agent.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on January 22, 2019.
|
Amendment No. 1 to Credit Agreement, dated as of March 25, 2019, by and between Walgreens Boots Alliance, Inc. and Sumitomo Mitsui Banking Corporation, as sole lead arranger and administrative agent, amending that certain Credit Agreement, dated as of November 30, 2018, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto, and Sumitomo Mitsui Banking Corporation, as sole lead arranger and administrative agent.
|
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2019 (File No. 1-36759) filed with the SEC on April 2, 2019.
|
|
Amendment No. 1 to Term Loan Credit Agreement, dated as of August 9, 2019, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Wells Fargo Bank, National Association, as administrative agent, amending that certain Term Loan Credit Agreement, dated as of December 5, 2018, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Wells Fargo Bank, National Association, as administrative agent.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on August 12, 2019
|
|
Revolving Credit Agreement, dated as of August 30, 2019, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and HSBC Bank USA, N.A., as administrative agent, and HSBC Securities (USA), Inc., as sole lead arranger.
|
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on September 4, 2019.
|
|
Revolving Credit Agreement, dated as of August 30, 2019, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Citibank, N.A., as administrative agent and sole lead arranger.
|
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on September 4, 2019.
|
|
Revolving Credit Agreement, dated as of August 30, 2019, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and UniCredit Bank AG, New York Branch, as administrative agent.
|
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on September 4, 2019.
|
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Subsidiaries of the Registrant.
|
|
Filed herewith.
|
|
Consent of Deloitte & Touche LLP.
|
|
Filed herewith.
|
|
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed herewith.
|
|
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Filed herewith.
|
|
Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
|
Furnished herewith.
|
|
Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
|
Furnished herewith.
|
|
101.INS
|
XBRL Instance Document
|
|
Filed herewith.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
Filed herewith.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
Filed herewith.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
Filed herewith.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
Filed herewith.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Filed herewith.
|
*
|
Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Copies of any omitted schedule or exhibit will be furnished supplementally to the SEC upon request.
|
**
|
Other instruments defining the rights of holders of long-term debt of the registrant and its consolidated subsidiaries may be omitted from Exhibit 4 in accordance with Item 601(b)(4)(iii)(A) of Regulation S-K. Copies of any such agreements will be furnished supplementally to the SEC upon request.
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|
|
WALGREENS BOOTS ALLIANCE, INC.
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|
|
|
|
|
|
October 28, 2019
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By:
|
/s/ James Kehoe
|
|
|
James Kehoe
|
|
|
|
Executive Vice President and Global Chief Financial Officer
|
Name
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Stefano Pessina
|
|
Executive Vice Chairman and Chief
Executive Officer (Principal Executive Officer) and Director
|
|
October 28, 2019
|
Stefano Pessina
|
|
|
|
|
|
|
|
|
|
/s/ James Kehoe
|
|
Executive Vice President and Global
Chief Financial Officer (Principal Financial Officer)
|
|
October 28, 2019
|
James Kehoe
|
|
|
|
|
|
|
|
|
|
/s/ Heather Dixon
|
|
Senior Vice President, Global Controller
and Chief Accounting Officer (Principal Accounting Officer)
|
|
October 28, 2019
|
Heather Dixon
|
|
|
|
|
|
|
|
|
|
/s/ James A. Skinner
|
|
Executive Chairman
|
|
October 28, 2019
|
James A. Skinner
|
|
|
|
|
|
|
|
|
|
/s/ José E. Almeida
|
|
Director
|
|
October 28, 2019
|
José E. Almeida
|
|
|
|
|
|
|
|
|
|
/s/ Janice M. Babiak
|
|
Director
|
|
October 28, 2019
|
Janice M. Babiak
|
|
|
|
|
|
|
|
|
|
/s/ David J. Brailer
|
|
Director
|
|
October 28, 2019
|
David J. Brailer
|
|
|
|
|
|
|
|
|
|
/s/ William C. Foote
|
|
Director
|
|
October 28, 2019
|
William C. Foote
|
|
|
|
|
|
|
|
|
|
/s/ Ginger L. Graham
|
|
Director
|
|
October 28, 2019
|
Ginger L. Graham
|
|
|
|
|
|
|
|
|
|
/s/ John A. Lederer
|
|
Director
|
|
October 28, 2019
|
John A. Lederer
|
|
|
|
|
|
|
|
|
|
/s/ Dominic P. Murphy
|
|
Director
|
|
October 28, 2019
|
Dominic P. Murphy
|
|
|
|
|
|
|
|
|
|
/s/ Nancy M. Schlichting
|
|
Director
|
|
October 28, 2019
|
Nancy M. Schlichting
|
|
|
|
|
1 Year Walgreens Boots Alliance Chart |
1 Month Walgreens Boots Alliance Chart |
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