Pharmacy Giant Walgreens Boots Alliance Sees Sales Down 2.4%
Total sales at Walgreens Boots Alliance fell 2.4%, to $29.4 billion, in the second quarter of the year, according to a financial statement issued by the group. Sales were up 0.9% on a constant-currency basis.
However, the group's international second-quarter sales were down 14.5% on the same period the previous year, mainly due to currency effects. The division, which includes UK high-street pharmacy chain Boots, posted sales of $3.1 billion, which was down 1.9% on a constant-currency basis.
On a constant-currency basis, comparable store sales in its international division decreased 0.9%, compared with the same period the previous year.
Its Retail Pharmacy USA division posted second-quarter sales of $21.8 billion, a 2.4% increase in comparable same-store sales.
"Our results this quarter were in line with our expectations, despite some challenging conditions we faced in a number of markets," said chief executive Stefano Pessina. "I am particularly pleased with the growth in pharmacy volume and market share in the Retail Pharmacy USA division."
Commenting on the group's performance, Neil Saunders, the managing director of GlobalData Retail, said, "In many ways, the challenges with overseas markets are unavoidable and are not a consequence of any real missteps on the part of Walgreens. The appreciation of the dollar since this time last year, and the accompanying depreciation of sterling, in particular, has had a dramatic impact on sales and profit.
"This is exacerbated by the fact that in most of its overseas markets, and in the UK, specifically, Walgreens operates mature businesses which produce steady uplifts, rather than spectacular growth that could mask some of the effects of currency change."
Saunders added, "[It is] notable and slightly disappointing that international sales declines on a constant-currency basis are sequentially worse than the prior quarter. This is, in large part, due to a much worse pharmacy performance from Boots in the UK, down to government cuts to community pharmacy funding."
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.