Walgreens Boots Alliance Inc’s (NASDAQ: WBA) second quarter fiscal year 2024 sales increased 6.3% Y/Y to $37.1 billion, up 5.7% on a constant currency basis, beating the consensus of $35.86 billion.
Adjusted operating income was $900 million, a decrease of 26.5% on a constant currency basis, reflecting lower sale-leaseback gains and softer U.S. retail performance, partly offset by improved profitability in the U.S. Healthcare segment.
Adjusted EPS increased 3.4% to $1.20, up 2.8% on a constant currency basis, reflecting a lower adjusted effective tax rate and improved profitability in U.S. Healthcare, beating the consensus of $0.82, according to data from Benzinga Pro.
During the quarter, the company took a $5.8 billion impairment charge related to its VillageMD business. Walgreens increased its stake in VillageMD in 2021 to 63% from 30% by investing $5.2 billion in the company.
The U.S. Retail Pharmacy segment had second-quarter sales of $28.9 billion, an increase of 4.7% from the year-ago quarter. Comparable sales increased 4.8% from the year-ago quarter.
Pharmacy sales increased 8.2% Y/Y. Comparable pharmacy sales increased 8.7%, benefiting from higher branded drug inflation and strong execution in pharmacy services.
Comparable prescriptions filled in the second quarter increased 2.7%, while comparable prescriptions excluding immunizations increased 2.9%.
Total prescriptions filled in the quarter, including immunizations, was 305.7 million, up 2.6%.
Retail sales decreased by 4.5%, and comparable retail sales decreased by 4.3%, reflecting a challenging retail environment, channel shift, and a weaker respiratory season.
Guidance: Walgreens Boots Alliance narrowed the fiscal year 2024 adjusted EPS guidance to $3.20-$3.35 versus prior guidance of $3.20-$3.50 and consensus of $3.24.
The company maintains U.S. Healthcare adjusted EBITDA to be breakeven at the midpoint of the guidance range of ($50) to $50 million.
Price Action: WBA shares are down 2.69% at $20.46 during the premarket session on the last check Thursday.
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