Walgreens indicates slowdown in 2Q growth as COVID impact wanes
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Walgreens Boots Alliance (NASDAQ:WBA) is trading lower in the pre-market Thursday despite better than expected revenue and earnings posted by the pharmacy retail chain with its 2Q FY22 financials.
The growth in sales from continuing operations slowed to ~3% YoY compared to ~8% YoY rise in 1Q FY22, and ~13% YoY growth in 4Q FY21.
During the quarter, Walgreens Boots (WBA) had administered over 11.8M COVID-19 vaccinations and performed 6.6M COVID-19 tests, indicating slowdown in pandemic-related benefits in 1Q FY22 when vaccinations and COVID-19 tests stood at 15.6M and 6.5M, respectively.
Despite the seventh consecutive quarterly beat, non-GAAP EPS exceeded expectations by only $0.19 compared to $0.34 in the prior quarter. EPS from continuing operations dropped to $1.02 from $1.06 in 2Q FY21.
The biggest revenue generator, U.S., reported ~15% growth in retail comparable while Boots UK retail comparable sales climbed ~22%.
For fiscal 2022, Walgreens (WBA) maintained its adjusted EPS guidance of low-single digit growth
"Second quarter results demonstrated broad-based execution, driving strong comparable sales and robust earnings growth,â Chief Executive Rosalind Brewer noted ahead of the conference call scheduled for Thursday at 8:30 a.m. EST.
âThe strategic review of our Boots business is progressing, and our transformational actions are accelerating sustainable value creation," she added.
Read: Last week, Sky News reported that Apollo Global was in talks with several banks to help finance a Â£6B bid for Walgreens U.K. Boots chain.