Walgreens Grows Q1 Sales, Earnings

Walgreen Co. has announced results for its first quarter of fiscal year 2015, ended November 30. First quarter sales increased 6.7% compared with the prior-year quarter to a record $19.6 billion, with total sales in comparable stores increasing 5.7%. Front-end comps increased 1.5% in the first quarter compared with last year’s first quarter. While customer traffic in comparable stores decreased 2.7%, basket size increased 4.2%, noted the retailer.

GAAP net earnings for the fiscal 2015 first quarter were $809 million, a 16.4% increase from $695 million in the year-ago quarter. Net earnings per diluted share for the quarter increased 18.1% to 85 cents, compared with 72 cents per diluted share in the year-ago quarter.

Adjusted fiscal 2015 first quarter net earnings were $773 million, a 12.4% increase from $688 million in the same quarter a year ago. Adjusted net earnings per diluted share for the quarter increased 12.5% to 81 cents, compared with 72 cents per diluted share in the year-ago quarter. This year’s first quarter earnings adjustments had a net negative impact of $36 million or 4 cents per diluted share.

“This quarter we had solid performance across both our pharmacy and retail products businesses,” said Walgreens president and CEO Greg Wasson. “We also completed our financing to close the Alliance Boots transaction as we move toward our shareholder vote on December 29 to finalize the merger, ahead of our original goal. This truly is an extraordinary time for Walgreens as we achieve our vision of becoming a pharmacy-led, global enterprise for health and wellbeing with Alliance Boots.”

Alliance Boots contributed 11 cents per diluted share to Walgreens first quarter 2015 adjusted EPS. The combined synergies for Walgreens and Alliance Boots in the first quarter were approximately $140 million and remain on track to reach at least $650 million in fiscal 2015, according to Walgreens.

Walgreens operates 8,230 drugstores with a presence in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands as well as Walgreens.com, drugstore.com, Beauty.com, SkinStore.com and VisionDirect.com.