For the second quarter ended February 28, Walgreen Co. posted net GAAP earnings of $754 million, or 78 cents per diluted share, versus $756 million, or 79 cents per diluted share, in the year-prior period. Adjusted earnings for the quarter, discounting one-time items, were $880 million, or 91 cents per diluted share, versus $915 million, or 96 cents per diluted share, for the period a year ago.
Walgreens earnings per share missed a Thomson Reuters average analyst estimate by two cents.
Second quarter sales increased 5.1%to $19.6 billion, the company announced. Front-end comparable store sales, including general merchandise such as housewares, gained 2% based on a 1.4% decrease in traffic but a 3.4% increase in basket size. Total comps increased 4.3% as prescription comps gaining 5.8%.
“Our second quarter performance, in spite of expected headwinds from slower generic drug introductions, comparisons with last year’s flu season and severe weather, was marked by solid top-line growth driven by record quarterly sales and record second-quarter prescriptions filled,” said Greg Wasson, Walgreen’s president and CEO, in announcing the financial results. “We also continued to gain prescription market share while we maintained a firm hold on our costs. We head into the second half of the year with nearly 80 million active members in our Balance Rewards loyalty program and with expectations that the generic drug headwind that affected the first half will ease and turn around by the end of the year. In addition, our joint synergy program with Alliance Boots is expected to exceed its second-year estimate, and we are bringing critical elements of the Well Experience to additional stores.”
In its 2014 second quarter, Walgreens opened or acquired 28 new locations compared with 29 in the year-ago period.
As if February 28, Walgreens operated 8,681 locations in all 50 of the United States, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands. The total included 8,210 drugstores, 138 more than a year earlier. The company also operates worksite health and wellness centers, infusion and respiratory services facilities, specialty pharmacies and mail service facilities. Its Take Care Health Systems subsidiary manages about 700 in-store convenient care clinics and worksite health and wellness centers.