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Walgreens Boots Alliance reports above-forecast fourth quarter profit and revenue

The drugstores group - which is in the midst of the takeover of Rite Aid Corp – posted adjusted earnings per share for the quarter of US$1.31, above the consensus of estimate US$1.21

Walgreens store
Walgreens revenue rose to US$30.15bn, up from US$28.64bn a year earlier, also above consensus for US$29.93bn

Walgreens Boots Alliance Inc.(NASDAQ: WBA) saw its shares rise in pre-market trading after the drugstores operator reported above-forecast profit and revenue for the fourth quarter.

The group - which is in the midst of the  takeover of Rite Aid Corp. (NYSE:RAD) – posted adjusted earnings per share for the quarter of US$1.31, above the consensus of estimate US$1.21, as revenue rose to US$30.15bn, up from US$28.64bn a year earlier, also above consensus for US$29.93bn.

Overall fourth quarter earnings were US$802mln, or 76 US cents per share, down from US$1.03bn, or 95 US cents per share in the year-earlier period reflecting costs related to the Rite Aid deal.

Walgreens said that ownership of the Rite Aid stores is expected to transfer in phases, with a spring 2018 completion goal, and integration of the stores and other assets is expected to be completed within the next three years at a cost of about US$750mln.

The group said it expects to spend an additional about US$500mln on store conversions and related activities, but expects to save US$300mln in "annual synergies" such as procurement and cost savings within four years of the transaction closing.

Walgreens’ chief executive, Stefano Pessina said the firm has done well despite "ongoing prescription reimbursement pressure and competing in fast-changing retail environments."

The company said it expects its 2018 adjusted EPS to be in a range of US$5.40 to US$5.70, compared with consensus of US$5.40.

In pre-market trading, Walgreens’ shares were up 4.4% at US$70.25.

Quick facts: Walgreens Boots Alliance Inc

Price: 54.41 USD

NASDAQ:WBA
Market: NASDAQ
Market Cap: $48.2 billion
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