THE WHAT? Walgreens Boots Alliance Q4 results have beaten industry forecasts, with the company reporting a US$415 million loss in the quarter that ended August 31, with sales falling 5 percent to US$32.45 billion.
THE DETAILS Fourth quarter operating loss from continuing operations was US$822 million compared to operating income of US$910 million YOY.
According to the company, “Net loss from continuing operations in the fourth quarter was US$415 million compared to net income of US$358 million in the year-ago quarter, reflecting the decline in operating income, which was partly offset by the favorable impact of a lower tax rate, and a gain on the sale of a portion of the Company’s equity method investment in Option Care Health.”
THE WHY? The retailer was said to be hit by a drop in COVID-19 vaccinations, as well as a US$783 million non-cash impairment charge from its Boots UK business.
Chief Executive Officer Rosalind Brewer said: “WBA has delivered ahead of expectations in the first year of our transformation to a consumer-centric healthcare company. Our resilient business achieved growth while navigating macroeconomic headwinds. Fiscal 2023 will be a year of accelerating core growth and rapidly scaling our U.S. Healthcare business.
“Our execution to date provides us visibility and confidence to increase the long-term outlook for our next growth engine and reconfirm our path to low-teens adjusted EPS growth. Our strategic actions are unlocking sustainable shareholder value as we simplify the company and continue our journey to being a healthcare leader.”
Looking forward, WBA is expecting fiscal year 2023 adjusted EPS of US$4.45 to US$4.65 as ‘strong core business growth is more than offset by lapping fiscal year 2022 COVID-19 execution, and currency headwinds.’
It is also raising its U.S. Healthcare fiscal 2025 sales target to US$11 billion to US$12 billion, with the segment expected to achieve positive adjusted EBITDA by fiscal year 2024.