The newly-formed multinational pharmacy business Walgreens Boots Alliance has announced a surge in earnings for the period December 2014 to February 2015 compared with the same period in 2013–2014.
In its first financial report since Walgreens Boots Alliance was formed from the merger of US pharmacy giant Walgreens and European pharmacy chain Boots Alliance in December 2014, the company details its plan to close 200 pharmacies in the United States as part of a cost-cutting programme announced in August 2014.
In parallel to the merger, the company also embarked on a plan to save US$1bn over three years. With the closure of 200 pharmacies, savings are now projected to rise to US$1.5bn.
“We are restructuring our cost base, with a focus primarily in the United States, to create a more efficient cost model and become a more agile company,” says executive vice chairman and acting CEO Stefano Pessina.
Net earnings between December 2014 and February 2015 increased to US$2bn compared with US$0.7bn in the same period the previous year. However, the figures are not directly comparable because of the merger.
Sales jumped by 35.5% over the same period. However, when the comparison is restricted to the Retail Pharmacy USA division — principally formed of the Walgreens pharmacy brand — sales increased by 6.9% compared with the previous year.
In the company’s Retail Pharmacy International division (principally the Boots pharmacy brand) there was a 2.9% increase in store sales in January 2015 and February 2015 compared with the same period in 2014.
Sales within Walgreens’ newly acquired wholesale division, operating under the Alliance Healthcare brand, remained flat.
