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Aug 31, 2022
Walgreens Q4 2022 Earnings Report
Walgreens' Q4 2022 earnings exceeded expectations, with long-term targets raised for the U.S. Healthcare segment.
Key Takeaways
Walgreens Boots Alliance reported Q4 sales of $32.4 billion, a 5.3% decrease year-over-year. The company's loss per share was $0.48, while adjusted EPS decreased by 31.8% to $0.80. Despite these declines, Walgreens is raising its U.S. Healthcare fiscal 2025 sales target and expects low-teens adjusted EPS growth in fiscal year 2025 and beyond.
Q4 sales decreased by 5.3% year-over-year to $32.4 billion.
Loss per share from continuing operations was $0.48, a decrease of $0.89 from the year-ago quarter.
Adjusted EPS decreased 31.8% to $0.80, down 30.0% on a constant currency basis.
Raising U.S. Healthcare fiscal 2025 sales target to $11 billion to $12 billion, with the segment expected to achieve positive adjusted EBITDA by fiscal year 2024.
Walgreens
Walgreens
Walgreens Revenue by Segment
Walgreens Revenue by Geographic Location
Revenue by Segment
U.S. Healthcare Revenue
CapyFin.comRevenue by Geographic Location
International Revenue
CapyFin.com Forward Guidance
Walgreens Boots Alliance expects an adjusted EPS of $4.45 to $4.65 for the full fiscal year 2023. The company is also raising the U.S. Healthcare fiscal year 2025 sales target to $11 billion to $12 billion.
Positive Outlook
- Healthy core business growth of 8 to 10 percent in constant currency
- Raising U.S. Healthcare fiscal year 2025 sales target to $11 billion to $12 billion
- The U.S. Healthcare segment is expected to achieve positive adjusted EBITDA by fiscal year 2024.
- Reconfirmed expectation to achieve low-teens adjusted EPS growth in fiscal year 2025.
- Management will provide additional details during the earnings call presentation.
Challenges Ahead
- Adverse currency movements of approximately 2 percent
- Headwind of 15 to 17 percent from lower COVID-19 vaccination volumes.
- Operating loss in the quarter reflects a $783 million non-cash impairment charge related to intangible assets in Boots UK.
- Operating loss in the quarter reflects higher costs related to the Transformational Cost Management Program.
- Adjusted operating income from continuing operations was $744 million, a decrease of 38.2 percent on a constant currency basis, reflecting lower U.S. pharmacy operating results as it lapped higher volumes of prior year COVID-19 vaccinations, and growth investments in U.S. Healthcare