Walgreen Posts Loss In Q4, Adj. EPS Meets View

(RTTNews) - Drugstore chain Walgreen Co. (WAG) Tuesday reported a loss for the fourth quarter, compared to profit last year, hit by a hefty non-cash loss. Adjusted earnings met Wall Street expectations, and so were revenues.

Walgreens President and CEO Greg Wasson said, "Our fourth quarter performance was in line with our expectation, recognizing we have much more to do... we maintained solid expense control in the fourth quarter and are moving forward with the implementation of our previously announced cost-reduction initiative to achieve $1 billion in savings by the end of fiscal 2017."

Net loss attributable to the company was $239 million or $0.25 per share, compared to a profit of $657 million or $0.69 per share last year. The latest results included a $0.90 per share non-cash loss related to its strategic partner Alliance Boots call option amended and exercised during the quarter.

Adjusted net earnings per share was $0.74, while it totaled $0.73 in the year-ago quarter. On average, 22 analysts polled by Thomson Reuters expected earnings of $0.74 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue advanced to $19.057 billion from $17.941 billion last year, as total sales in comparable stores increased 5.4 percent. Analysts expected revenues of $19.02 billion.

Front-end comparable store sales grew 1.3 percent in the fourth quarter. Customer traffic in comparable stores decreased 2.2 percent and basket size increased 3.5 percent.

Prescription sales, which accounted for 65.7 percent of sales in the quarter, increased 9.3 percent, while prescription sales in comparable stores increased 7.8 percent.

The company filled 211 million prescriptions in the quarter, up 4.2 percent from last year. Prescriptions filled in comparable stores increased 3.9 percent.

The company opened or acquired 46 new drugstores in the fourth quarter compared with 33 in the year-ago quarter.

At August 31, Walgreens operated 8,309 locations with a presence in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands.

WAG, which closed down around 1 percent on Monday at $59.60, advanced 2.5 percent in pre-market trading.