Walgreens Boots Alliance (WBA) Fourth Quarter 2021 Profits Beat

Alliance of Walgreens boots Thursday beat Wall Street expectations for fiscal fourth quarter profits, as company saw increased demand for Covid-19 vaccines amid a growing number of employer mandates.

The shares were trading up about 1% on Thursday, as investors discussed the drugstore chain’s ambitious plans to transform into a healthcare-focused company. This announced it is investing an additional $ 5.2 billion in VillageMD, a primary care company that opens clinics in Walgreens stores.

Walgreens administered 13.5 million vaccines in the fourth quarter – nearly double the roughly $ 7 million he had planned within the three month period. He is ready for another round of vaccinations as people receive booster doses and young children should soon qualify for the shots.

“Mandates play a role,” CEO Roz Brewer said in an interview with CNBC’s Bertha coombs. “There are a lot of companies and organizations, cities and municipalities that impose and I think that forces people to say, ‘I have to go to work. So I have to get the vaccine.’ So that creates an increase. And we see it in our stores. “

Plus, she said, people fear having Covid – especially with the delta variant.

Along with the lifting of vaccinations, Walgreens said it saw increased sales thanks to at-home Covid testing and a rebound in demand for over-the-counter cold, cough and flu medications.

The company met its goal of reducing annual operating costs by $ 2 billion a year ahead of schedule. CFO James Kehoe has said he will increase his savings target to $ 3.3 billion by fiscal 2024.

He said the company expects stable growth in adjusted earnings per share in fiscal 2022 at constant exchange rates.

Brewer also told CNBC that the pharmacy will focus more on healthcare at the front of the store and in its drugstores. She said the company take a critical look at tobacco, which he kept on the shelves despite his rival CVS Health drop the products.

Here’s what Walgreens reported compared to what analysts expected for the fourth quarter ended Aug.31. based on Refinitiv data:

  • Earnings per share: $ 1.17 adjusted vs. $ 1.02 expected
  • Returned: 34.26 billion dollars against 33.30 billion dollars expected

In the quarter, net income reached $ 627 million, or 72 cents per share, versus $ 373 million, or 43 cents per share, a year earlier. Walgreens earned $ 358 million, or 41 cents per share, from continuing operations in the last quarter.

However, excluding items, the company gained $ 1.17 per share, exceeding the $ 1.02 expected by analysts polled by Refinitiv.

Sales reached $ 34.26 billion against $ 30.37 billion a year earlier, higher than the $ 33.30 billion expected by analysts.

Sales online and at Walgreens stores in the United States open at least a year ago increased 8.1% year-over-year as consumers were vaccinated against Covid-19 and filled more prescriptions . Sales of health and wellness products jumped 14% year-over-year, with consumers buying more at-home Covid tests, vitamins and over-the-counter cough, cold and influenza.

Brewer said the Covid vaccines have had a “halo effect” with store sales. As people walked to the drugstore for a jab or waited 15 minutes after the hit, she said some were buying other types of merchandise, from beauty items to allergy medication. She said Walgreens wants to increase the number of other types of vaccines it administers, for hepatitis B and more.

Its international segment – which includes UK chain Boots – is rebounding after the Covid-19 restrictions were lifted in July. Sales online and in Boots UK stores that have been open for at least a year were up 11.4% in pharmacy services and 15% in retail compared to the previous year quarter.

Foot traffic in Boots stores on main streets, such as nearby offices and suburban centers, is recovering but remains below pre-pandemic levels, the company said.

The pharmacy chain said it has administered more than 40 million Covid vaccines to date. His vaccinations peaked in the third trimester, when he administered 17 million vaccines.

As of Wednesday’s close, shares of Walgreens Boots Alliance have risen about 19% this year. The company’s market valuation is $ 40.88 billion. The shares closed Wednesday down less than 1% at $ 47.26.

Read the company’s press release here.

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