DE4CC0DE-5FC3-4494-BCBF-4D50B00366B5
Retail

Walgreens Cuts Profit Forecast On Lower COVID-19 Vaccine Demand

By Reuters
Share this article
Walgreens Cuts Profit Forecast On Lower COVID-19 Vaccine Demand

Walgreens Boots Alliance (WBA) has cut its fiscal year profit forecast on lower demand for COVID-19 tests and vaccines and lower consumer spending.

The fourth quarter is expected to be negatively impacted by a higher effective tax rate, shifting US consumer spending and the impact of the flu season, the company said.

It now expects annual adjusted earnings per share of $4.00 to $4.05, from $4.45 to $4.65 previously.

Chief executive officer Rosalind Brewer said, "Our revised guidance takes an appropriately cautious forward view in light of consumer spending uncertainty, while still demonstrating clear drivers of a return to operating growth next fiscal year.

"We are raising our cost savings programme target to $4.1 billion (€3.8 billion) and taking immediate actions to optimise profitability for our US Healthcare segment. I am confident that our turnaround strategy positions WBA to drive sustainable core growth and deliver long-term shareholder value."

ADVERTISEMENT

Third-Quarter Performance

Excluding one-off items, the company reported earnings of $1 per share for the quarter ended 31 May, compared to analysts' average estimate of $1.07 per share, according to Refinitiv IBES data.

Rosalind Brewer added, "WBA achieved 8.9% constant currency sales growth in the third quarter despite a challenging operating environment. Consumers continue to appreciate the value, convenience, and range of services provided by Walgreens and Boots."

Divisional Performance

In the US, retail pharmacy segment saw sales worth $27.9 billion (€25.5 billion), up 4.4% year on year, while comparable sales increased 7.0% from the year-ago quarter.

The company's international segment generated sales worth $5.6 billion (€5.1 billion) in the latest quarter, registering a year-on-year increase of 5%.

ADVERTISEMENT

Sales increased 6.9% on a constant currency basis, with Boots UK seeing sales growth of 10.2%, and the Germany wholesale business growing 3.8%.

Boots UK comparable pharmacy sales increased 5.7% compared with the year-ago quarter, while Boots UK comparable retail sales increased 13.4%.

Boots.com reported 25% year-on-year growth in sales, accounting for over 14% of retail sales.

News by Reuters, additional reporting by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.