Walgreens Posts Fall In Q3 Profit On Opioid Settlement, Lower Pharmacy Sales

  • Walgreens Boots Alliance Inc's WBA Q3 FY22 sales decreased 4.2% Y/Y to $32.6 billion, down 2.8% on a constant currency basis, beating the consensus of $32.06 billion.
  • Adjusted EPS reached $0.96, beating the consensus of $0.92, down 28.9% on a constant currency basis against 93.6% growth a year ago that reflected peak COVID-19 vaccine volumes.
  • The drugstore chain administered 4.7 million COVID vaccines and 3.9 million tests in the third quarter.
  • U.S. Retail comparable sales grew 2.4%, excluding tobacco, and Boots UK retail comparable sales grew 24%, with market share gains across all major categories
  • During the quarter, the company launched a clinical trials business, sold 6 million shares of AmerisourceBergen Corp ABC, with proceeds of $900 million, and completed Boots strategic review, deciding to retain the business.
  • Adjusted operating income reached $1 billion, a decrease of 33.5%.
  • Net earnings decreased 73.8% to $289 million, reflecting the opioid settlement with the State of Florida, a decrease in U.S. pharmacy operating results as it lapped the prior year's peak COVID-19 vaccinations. 
  • Net cash provided by operating activities was $1.6 billion in Q3, and free cash flow was $1.3 billion.
  • Guidance: Walgreens Boots Alliance maintains FY22 adjusted EPS guidance of low-single-digit growth.
  • Price Action: WBA shares are down 2.23% at $39.96 during the premarket session on the last check Thursday.
  • Photo Via Wikimedia Commons
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