Walgreens Profit Falls, Sales Pick Up

By Aisha Al-Muslim 

Walgreens Boots Alliance Inc.'s profit fell in the latest quarter even as sales increased.

The drugstore chain, based in Deerfield, Ill., said it improved U.S. retail sales, U.S. same-store sales, and prescription growth in the most recent quarter.

For the third quarter ended May 31, profit fell 23.6%, partly driven by its gross profit falling. Gross profit decreased in the quarter about 4.2% as the company faced reimbursement pressure in pharmacy, as well as a lower pharmacy margin and retail sales at Boots UK.

Net income slipped to $1.03 billion, or $1.13 a share, down from $1.34 billion, or $1.35 a share, a year earlier. Adjusted earnings came in at $1.47 a share, higher than the $1.43 a share that analysts polled by Refinitiv expected.

Walgreens said sales rose 0.7% to $34.6 billion, primarily due to growth in its U.S. retail pharmacy and pharmaceutical wholesale divisions. Analysts expected Walgreens to report sales of $34.46 billion.

In the quarter, U.S. retail pharmacy sales rose 2.3% to $26.5 billion, reflecting higher brand inflation and prescription volume.

Same-store pharmacy sales increased 6%, while comparable retail sales were down 1.1% primarily due to the continued de-emphasis of tobacco.

The stock rose 1.2% to $53 in pre-market trading Thursday. Shares are down 21% in the last year.

For fiscal 2019, Walgreens maintained its adjusted earnings per share at constant currency rates to be roughly flat.

(END) Dow Jones Newswires

June 27, 2019 08:26 ET (12:26 GMT)

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