Tuesday, October 27, 2020

Walgreens Sees Rebound Despite $520 Million Covid-19 Hit

Bruce Japsen Senior Contributor Oct 15, 2020,09:17am EDT

People wear protective face masks outside[+]

GETTY IMAGES

Walgreens Boots Alliance reported a $520 million “adverse Covid-19 impact” in its fourth quarter as the global drugstore chain begins a slow rebound during the pandemic.

Walgreens, which owns more than 21,000 stores around the world in more than 25 countries, said net income fell nearly 45% to $373 million in its fiscal 2020 fourth quarter ended Aug. 31 due to the surge of cases of Covid-19 that caused customers to shelter in their homes and slow the global economy. Fourth quarter sales increased 2% to $34.7 billion.

“The company estimates adverse Covid-19 impact of approximately $520 million, or 34 percentage points of growth,” Walgreens said Thursday in its fiscal 2020 fourth quarter and annual earnings report.

Though retail pharmacy sales in the U.S. were up in the quarter, Walgreens saw a double-digit percentage drop in its retail pharmacy international operation which has been a drag on earnings. Walgreens said U.S. retail pharmacy sales rose 3.6% to $27 billion while international pharmacy sales decreased nearly 15% to $2.3 billion.

“Despite uncertainty amid the global COVID-19 pandemic, we are seeing gradual improvement in key U.S. and UK markets and continued strong performance in our wholesale business,” Pessina said.

Still, Walgreens exceeded analysts’ earnings expectations in the fourth quarter and the company said it expects a major comeback in fiscal 2021. Walgreens projected “low single-digit growth in adjusted earnings per share” in releasing its fiscal 2021 guidance.

“We are on our way to putting it behind us,” Pessina told analysts on 70-minute call Thursday morning to discuss earnings. “We expect the first half of the year to be challenging. But we are optimistic for a recovery in the second half.”

https://www-forbes-com.cdn.ampproject.org/c/s/www.forbes.com/sites/brucejapsen/2020/10/15/walgreens-sees-store-rebound-despite-520-million-covid-19-hit/amp/

No comments:

Post a Comment