As it engages in a turnaround effort, Walgreens Boots Alliance posted lower earnings and lower retail comparable sales but still beat Wall Street estimates.
Earnings per adjusted share topped a Zacks Investment Research analyst consensus estimate of 37 cents and a revenue forecast of 6.4%.
Net sales were $39.46 billion versus $36.71 billion in the year-prior quarter. Operating loss was $245 million versus $39 million in the year-earlier period, while adjusted operating income was $593 million versus $687 million.
U.S. Retail Pharmacy segment sales were $30.87 billion, up 6.6% from the year-past quarter, as comparable sales increased by 8.5%. Retail sales decreased 6.2 % from the year-past period as comps declined 4.6,% reflecting a weaker cough cold flu season and lower sales in discretionary categories.
In a conference call, Walgreens CEO Tim Wentworth said the cornerstone of the company’s turnaround initiative is stabilizing the U.S. retail pharmacy business. He noted that Walgreens is pleased with its footprint optimization program as it has operated it so far. The company has closed about 2,000 stores over the past decade and has stepped up store shuttering plans for the next three years, targeting 450 locations for closure. In stores, Walgreens will continue to operate, and comparable front-end sales, including in retail merchandise such as housewares, are outpacing those at stores slated to close this year by about 250 basis points, he said.
Wentworth said in announcing the first quarter results, “Our first quarter results reflect our disciplined execution against our 2025 priorities: stabilizing the retail pharmacy by optimizing our footprint, controlling operating costs, improving cash flow and continuing to address reimbursement models. While our turnaround will take time, our early progress reinforces our belief in a sustainable, retail pharmacy-led operating model.”
