Walgreens Boots Alliance (WBA) - Get Report posted stronger-than-expected fourth quarter earnings Monday while setting out near-term forecasts for profit growth and boosting its target for planned cost savings.
Walgreens said adjusted earnings for the three months ending in September, the drugstore chain's fiscal fourth quarter, came in at $1.43 per share, down 3.4% from the same period last year and two cents ahead of the Street consensus forecast. Group revenues, Walgreens said, rose 1.5% to $34 billion, topping analysts' forecasts of a $33.888 billion tally.
Looking into 2019, Walgreens said it sees flat adjusted earnings growth, with a range of plus or minus 3%, and boosted the estimate from its ongoing cost savings plan by 20%, to $1.8 billion, by 2022.
"We are making progress on our four strategic priorities, which we remain confident are positioning us to deliver long-term growth," said CEO Stefano Pessina. "While we still face headwinds, I am encouraged by the improvement in U.S. comparable sales performance in the second half of fiscal 2019 and our progress in managing costs in order to save to invest to grow."
"We are introducing guidance for fiscal 2020 adjusted earnings per share, which we expect will be roughly consistent with fiscal 2019 at constant currency rates - very much in line with our expectations," he added.
Walgreens Boots Alliance shares were marked 0.3% higher at the start of trading following the earnings release to change hands at $55.55 each, a move that would trim the stock's year-to-date decline of around 17.7%.
Walgreens said retail pharmacy international revenue fell 6.3%, thanks in part to a stronger U.S. dollar and notable underperformance from its UK division, known as Boots. Pharmaceuticals wholesale revenues, however, rose 3.1% from last year, and 7.9% on a currency-neutral basis, thanks in part to gains in emerging markets.