Walgreens Boots Alliance Inc on Thursday raised its 2021 adjusted profit growth forecast, buoyed by strength in drug sales and COVID-19 vaccine administrations.
The company, one of the largest US pharmacies, had been relying on gains from administering COVID-19 vaccines to tide over losses from low prescription volumes and a weak flu season that has hampered over-the-counter sales of health and wellness products in recent quarters.
However, prescription volumes improved in the third quarter amid a drop in COVID-19 cases in the United States and easing of social-distancing protocols and lockdowns.
Walgreens said it had administered more than 25 million COVID-19 vaccinations to date out of the 326.5 million shots given in the United States as of 30 June.
Same-store sales at its US pharmacies rose 6.4% in the third quarter as it filled 312.1 million prescriptions.
Walgreens raised its 2021 adjusted earnings per share forecast from mid-to-high single digit growth to around 10 percent growth.
Net income attributable to the company was $1.2 billion, or $1.38 per share, for the quarter ended 31 May, compared with a net loss of $1.71 billion, or $1.95 per share, a year earlier.
During the quarter, Walgreens Boots Alliance completed the divestiture of the Alliance Healthcare businesses to AmerisourceBergen for a total consideration of $6.5 billion.
The company added that it has used a portion of the proceeds to eliminate $3.3 billion in debt from its balance sheet and will invest the remainder to accelerate growth in its core retail pharmacy and healthcare businesses.
'A Strong Position'
Commenting on the company's performance, chief executive officer, Rosalind Brewer, said, "This quarter’s results demonstrate continued momentum, and while challenges lie ahead, we are in a strong position to grow and innovate our core retail and pharmacy businesses for the future.
"We are accelerating our investments to advance our operational excellence, including technology innovations that support mass personalisation, pharmacy of the future and the next phase of growth in tech-enabled healthcare."
The company's international division reported third-quarter sales of $5.3 billion, up 75.8% compared to the same period last year.
Sales increased 58.7% on a constant currency basis, driven by the company's wholesale joint venture in Germany, which was consolidated as of November 2020.
Excluding incremental sales from the joint venture, sales in the division on a constant currency basis increased 12.1%, reflecting a partial recovery in the UK market following the lifting of COVID-19 restrictions.
Boots UK saw comparable pharmacy sales increase 3.7% year-on-year, on the back of stronger pharmacy services and favorable timing of NHS reimbursement, partially offset by lower prescription volume.
Boots UK comparable retail sales increased 38.7% compared with the same period last year.
Footfall on the high street showed early signs of recovery amid a partial easing of strict lockdown measures, though travel locations in airports and train stations continued to face challenges, the company said.