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Walgreens Boots Alliance sees second-quarter sales and earnings miss market expectations, although US pharmacy sales picked up

The Nasdaq-listed group – formed at the end of 2014 by the merger of Walgreens with Alliance Boots - reported earnings of US$1.06bn, or 98 US cents a share for the quarter to February 28, compared with US$930mln, or 85 US cents a share a year earlier

Walgreen store
WBA’s second-quarter revenues fell by 2.4% to US$29.45bn, down from US$30.18bn a year earlier

Drug store chain Walgreens Boots Alliance Inc (NASDAQ:WBA) saw its second-quarter sales and earnings miss market expectations, although its pharmacy business sales picked up in the US with the highest quarterly prescription growth in years.

The  Nasdaq-listed group –  formed at the end of 2014 by the merger of Walgreens with Alliance Boots -  reported earnings of US$1.06bn, or 98 US cents a share for the quarter to February 28, compared with US$930mln, or 85 US cents a share in the same period a year earlier.

But its second-quarter adjusted earnings per share of US$1.36 was a touch below the consensus estimate of US$1.37 a share.

WBA’s second-quarter revenues fell by 2.4% to US$29.45bn, down from US$30.18bn a year earlier, also below the consensus forecast of US$30.26bn.

The group said its comparable pharmacy sales increased 4.2% on higher volumes as prescriptions filled in comparable US stores increased by 7.9% compared with the same quarter a year ago.

Retail challenging …

But WBA’s comparable retail sales fell 0.8% amid what the company called "a challenging market” notably for the consumables, general merchandise and personal care areas.

Weakness in those segments offset growth in health and wellness and beauty products.

WBA, which reaffirmed its fiscal 2017 forecast for adjusted earnings per share in a range of US$4.90 to US$5.08, also confirmed plans for a new US$1bn share buyback programme.

The company, however,  offered no new information regarding its much-eyed tie-up with Rite Aid Corp. (NYSE:RAD), only saying the deal was on-track to close by its extended deadline of the end of July.

Investors have grown increasingly uneasy that the deal, heavily scrutinised by regulators on anti-trust issues, could fall apart. The deal was originally unveiled in October 2015.

In premarket trading, WBA shares were 0.8% lower at US$81.81.

Quick facts: Walgreens Boots Alliance Inc

Price: 52.47 USD

NASDAQ:WBA
Market: NASDAQ
Market Cap: $46.45 billion
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