Walgreens shares rise after its earnings top estimates, fueled by higher drug sales

People put on protecting face masks exterior Walgreens pharmacy in Union Square as town continues Phase four of re-opening following restrictions imposed to gradual the unfold of coronavirus on September 24, 2020 in New York City.

Noam Galai | Getty Images

Walgreens Boots Alliance reported Thursday fiscal first-quarter earnings that exceeded Wall Street’s expectations, helped by stronger-than-expected pharmacy sales.

Walgreens shares had been up about 3% in premarket buying and selling.

Here’s what Walgreens reported in contrast with what analysts had been anticipating for the primary quarter ended Nov. 30, based mostly on Refinitiv information:

  • Earnings per share: $1.22 cents, adjusted vs. $1.03 anticipated
  • Revenue: $36.31 billion vs. $34.95 billion anticipated

In the primary quarter, Walgreens posted web lack of $308 million, or 36 cents per share, in contrast with a web revenue of $845 million, or 95 cents per share, a yr earlier.

Excluding a cost from its AmerisourceBergen funding, it earned $1.22 per share, higher than the $1.03 anticipated by analysts surveyed by Refinitiv.

Sales rose to $36.31 billion from $34.34 billion a yr earlier, outpacing the $34.95 billion that analysts anticipated.

Walgreens stated its pharmacy sales picked up within the U.S. because it stuffed extra prescriptions. Comparable pharmacy sales rose 5% in contrast with a yr earlier. The higher sales got here regardless of much less foot site visitors, decrease sales of cough, chilly and flu drugs and fewer new prescriptions as individuals skipped the physician’s workplace and socially distanced throughout the pandemic.

In the United Kingdom, Walgreen’s comparable pharmacy sales rose 2.5% p.c in contrast with a yr in the past, largely resulting from a reimbursement from the National Health System. Boots UK shops have been significantly hard-hit by restrictions throughout the pandemic. The NHS cost helped offset a drop in prescription quantity.

Walgreens reiterated its outlook for low single-digit development in adjusted earnings per share this yr. Yet the corporate cautioned it’s going to face headwinds because the U.Okay. has one other lockdown and clients proceed to restrict journeys to the shop.

The firm has sought development alternatives as the pharmacy trade faces disruption and the pandemic adjustments purchasing patterns. It’s responded by including extra health-care providers and increasing its digital choices. It unveiled a brand new cellular app and added curbside pickup at its U.S. shops, which might have on-line purchases prepared for purchasers in as little as 30 minutes.

It introduced plans in July to open tons of of major care clinics at its shops staffed and operated by VillageMD. It stated Wednesday it might speed up the timetable for that and expects to have 600 to 700 clinics open throughout the subsequent 4 years.

On Wednesday, it additionally stated it might divest its drug distribution enterprise in Europe by promoting it to U.S. drug wholesaler AmerisourceBergen for $6.5 billion. The sale will permit Walgreens to give attention to its pharmacy and retail companies.

Walgreens began administering Covid vaccines in mid-December to workers and residents at nursing houses and different long-term care services. It plans to supply the pictures to most people at its drugstores, as soon as they’re out there.

Walgreens shares have fallen about 28% over the previous one yr, carry its market worth to $37.2 billion.

Read the corporate’s full press launch right here.

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Written by Business Boy


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