Drugstore chain Walgreens Boots Alliance Inc posted a 76% fall in quarterly profit, hurt by its opioid settlement with Florida and a decrease in US pharmacy sales on waning demand for COVID-19 vaccinations.
Walgreens had been relying on gains from administering COVID-19 vaccines to tide over losses from low prescription volumes and over-the-counter sales of health and wellness products in recent quarters due to the pandemic.
However, after an Omicron-led surge in COVID-19 cases helped boost demand for vaccines and testing demand has tapered off since January.
Walgreens has forecast 30 million COVID vaccinations this year at its sites. In the third quarter, it administered about 4.7 million doses of vaccines and sold 3.9 million tests.
It administered 11.8 million doses of vaccines and sold 6.6 million tests in the preceding quarter.
Quarterly Performance
The company's net income attributable to Walgreens plunged to $289 million, or 33 cents per share, in the third quarter ended 31 May, from $1.2 billion, or $1.38 per share, a year earlier.
In May, the US pharmacy chain reached a $683 million settlement with Florida over claims that it had exacerbated the opioid crisis in the state.
Chief executive officer of Walgreens Boots Alliance Rosalind Brewer said, "WBA delivered strong execution across operating segments and against very robust growth last year. Third quarter results were broadly in line with our expectations, demonstrating the resilience of our business through our deep community connections and relevance to consumers [...].
"With our decision to conclude the Boots strategic review, I firmly believe that our strategic actions are working to deliver long-term shareholder value."
Earlier this week, the company announced that it scrapped its plan to sell its UK high street pharmacy chain, Boots, saying no third party was able to make an adequate offer due to the turmoil in the global financial markets.
News by Reuters, additional reporting by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.
