This week, Walgreens Boots Alliance Inc has posted their third quarter earnings report, which was better than many had expected. The strong third quarter puts the company on track, though, to satisfy their full-year profit guidance, ultimately beating Wall Street forecasts.
As a matter of fact, the company said their GAAP earnings for the last three months (ending in May), came in at $1.47 per share. This is 8.9 percent higher than the same period—their third fiscal quarter—from last year. In terms of group revenues, Walgreens revealed a 0.7 percent bump. That is equivalent to roughly $34.6 billion. This also beat the $34.334 billion estimates, though more narrowly. Finally, Walgreens filled nearly 291 million prescriptions to grow 2 percent, contributing to 6 percent growth in its biggest revenue-generator, comparable sales.
In addition, Walgreens reinforces its full-year EPS growth guidance should be between 7 and 12 percent, compared to last year. And they will continue to launch more strategic goals for cutting costs.
In a statement, Walgreens Boots Alliance CEO Stefano Pessina noted that the second quarter was difficult but progress in the third quarter has been impressive, particularly in US comparable growth weighed against the first quarter.
“We will continue our aggressive response to rapidly shifting trends, and have already seen improved US retail sales and prescription growth and are making good progress in implementing our Transformational Cost Management Program,” he adds. “Together, this gives us the confidence to reiterate the fiscal 2019 guidance we previously provided.”
All that considered, Walgreens shares opened the trading day up more than 3 percent—after the earnings release announcement—at a price of $54.20. While this is an improvement, price is still down 21 percent on the year.
Pessina further responds that some pressures the company has faced in the past will continue to impact the business. Furthermore, he said, “We still have a lot to do to develop the transformation and data to get ahead of the market trends again and return our company to strong and consistent growth.”
One such pressure Walgreens has been facing is lower pharmacy margins. Actually WBA Chief Financial Officer James Kehoe advises that this was probably the reason for the decrease in profits this year.