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Aug 31, 2020
Walgreens Q4 2020 Earnings Report
Walgreens reported results at the high end of expectations, adapting to changing customer needs amidst the COVID-19 pandemic.
Key Takeaways
Walgreens Boots Alliance reported a 2.3% increase in sales to $34.7 billion for the fourth quarter of fiscal year 2020. However, operating income decreased by 26.0% to $650 million, and EPS decreased by 42.8% to $0.43, impacted by COVID-19. The company introduced fiscal 2021 guidance of low single-digit growth in adjusted EPS at constant currency rates.
Sales increased 2.3 percent to $34.7 billion, up 2.3 percent on a constant currency basis.
Operating income decreased 26.0 percent to $650 million; Adjusted operating income decreased 27.7 percent to $1.1 billion, down 27.4 percent on a constant currency basis.
EPS decreased 42.8 percent to $0.43; Adjusted EPS decreased 28.2 percent to $1.02, down 27.9 percent on a constant currency basis; reflecting an estimated adverse COVID-19 impact of approximately $0.46.
Company introduced fiscal 2021 guidance of low single-digit growth in adjusted EPS at constant currency rates
Revenue by Segment
Forward Guidance
The company introduced fiscal 2021 guidance of low single-digit growth in adjusted earnings per share at constant currency rates.
Positive Outlook
- Anticipates a gradual reduction in COVID-19 impacts.
- Expects strong adjusted EPS growth in the second half of fiscal 2021 as recovery plans take hold.
- Significant investments in fiscal 2021 are expected to accelerate the company’s customer-centric approach.
- Focus on transforming omnichannel capabilities and offerings across retail and healthcare.
- Investments are expected to contribute to the second-half growth profile.
Challenges Ahead
- First half results will continue to be negatively impacted when compared with the pre-COVID-19 first half of fiscal 2020.
- The evolution of the pandemic remains uncertain.
- COVID-19 could present both incremental risks
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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