Walgreens stock jumps in fourth-quarter earnings, health care sales increase

Walgreens stock jumps in fourth-quarter earnings, health care sales increase

Updated at 10:20AM EST

Walgreens (WBA) Fourth-quarter earnings posted better-than-expected Thursday, while raising the healthcare sales target, sending shares in the drugstore chain up sharply in pre-market trading.

Walgreens Boots said adjusted earnings for the three months ending in August, the company’s fourth fiscal quarter, came in at 80 cents a share, down 31.6% from the same period last year but 3 cents ahead of Street consensus expectations. Walgreens said group revenue fell 5.3% from a year ago to $32.4 billion, again beating analyst expectations of $32.085 billion, as same-store sales in the United States rose 1.6%.

Looking at the current fiscal year, Walgreens said it sees adjusted earnings in the region of $4.45 to $4.65 per share, essentially meeting mid-street expectations, but noted that healthcare sales are likely to improve to between $11 billion and $12 billion. dollar.

“WBA has exceeded expectations in the first year of our transformation into a consumer-focused healthcare company,” said Rosalind Brewer, CEO of WBA. “Our resilient business has grown while surviving macroeconomic headwinds. Fiscal year 2023 will be the year of accelerating core growth and rapidly expanding the reach of the US healthcare business.”

“Our execution to date provides us with the vision and confidence to increase the long-term outlook for our next growth engine and reassert our path toward low teen-adjusted EPS growth,” she added. “Our strategic actions unlock sustainable shareholder value as we streamline the company and continue our journey to becoming a leading healthcare company.”

Shares of Walgreens, a component of Dow Jones, were up 3.1% in early trading after the earnings release to trade at $32.84 per share.

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Walgreens also noted that comparable sales at Boots, its UK division, were up 15.2% from a year ago, even amid a 6.9% decline in total pharmacy revenue.

Walgreens said earlier this week that it had a number of “productive discussions” in connection with the sale, but noted that “as a result of market instability severely affecting the availability of funding, no third party has been able to present an offer that adequately reflects the potentially high value Neither Boots nor No7 Beauty.

The 173-year-old Boots, which represents 2,200 staples on Britain’s high streets, was bought by Walgreens in 2014 for around £9 billion, but was effectively put on the block earlier this year when the group revealed plans To conduct a review of its business strategy in the UK.

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