Walgreens' October sales grew 4.7% to US$6.13B as comparable store sales grew 2.6%; sales for first two months of fiscal 2012 were US$12.07B, up 5% from year ago
November 3, 2011
– Walgreens (NYSE:WAG - News)(NASDAQ:WAG - News) had October sales of $6.13 billion, an increase of 4.7 percent from $5.86 billion for the same month in fiscal 2011.
Total front-end sales increased 3.3 percent in October, while comparable store front-end sales increased 1.7 percent. Customer traffic in comparable stores decreased 0.9 percent and basket size increased 2.6 percent.
Prescriptions filled at comparable stores increased 2.5 percent in October. Calendar day shifts in October, which had one additional Monday and one fewer Friday compared with October 2010, positively impacted prescriptions filled in comparable stores by 0.7 percentage point. Lower incidence of flu negatively impacted comparable prescriptions filled by 0.5 percentage point. In addition, the estimated negative impact on comparable prescriptions filled from prescription transfers and other trend analysis of prescriptions managed by Express Scripts, Inc., was approximately 0.6 percentage point.
Based on the company’s current estimates, and the current assumption that it will not be in Express Scripts’ pharmacy networks beginning Jan. 1, 2012, including for clients such as Tricare and WellPoint, Walgreens expects to achieve 97 to 99 percent of its fiscal 2011 prescription volume in fiscal 2012. Because the Express Scripts/Medco merger remains under review, the company has made no assumption regarding the consummation, timing or impact of the merger related to its business for fiscal 2012.
October pharmacy sales increased 4.6 percent, while comparable pharmacy sales increased 3.1 percent. Calendar day shifts positively impacted pharmacy sales in comparable stores by 0.7 percentage point. Comparable pharmacy sales were negatively impacted by 1.8 percentage points due to generic drug introductions in the last 12 months and by 1.1 percentage points due to lower incidence of cough, cold and flu. Pharmacy sales accounted for 65.3 percent of total sales for the month.
Flu shots administered at pharmacies and clinics season-to-date were nearly 4.1 million versus approximately 4.5 million last year.
Sales in comparable stores (those open at least a year) increased 2.6 percent. The effect of calendar day shifts positively impacted total comparable sales by 0.5 percentage point.
Calendar year-to-date sales were $60.12 billion, an increase of 6.9 percent from $56.22 billion in 2011.
Fiscal 2012 year-to-date sales for the first two months were $12.07 billion, up 5.0 percent from $11.50 billion.
Walgreens opened 17 stores during October, including five relocations, acquired one store and closed six.
At Oct. 31, Walgreens operated 8,234 locations in all 50 states, the District of Columbia, Puerto Rico and Guam. That includes 7,786 drugstores, 179 more than a year ago, including 34 stores acquired over the last 12 months. The company also operates home care facilities and specialty and mail service pharmacies. Its Take Care Health Systems subsidiary manages more than 700 in-store convenient care clinics and worksite health and wellness centers.
Please note: Sales numbers and the adjustments shown in the table are preliminary, unaudited and subject to revision. Comparable stores are defined as those drugstore locations open for at least 12 consecutive months without closure for seven or more consecutive days and without a major remodel or a natural disaster in the past 12 months. Acquired operating locations and relocations are not included as comparable stores for the first 12 months after the acquisition or relocation.
Cautionary Note Regarding Forward-Looking Statements: Statements in this document that are not historical, including, without limitation, statements regarding future prescription volumes, are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "expect," “likely,” "outlook," “forecast, "would," "could," "should," “will,” "project," "intend," "plan," "continue," "sustain," "on track," "believe," "seek," "estimate," "anticipate," "may," “possible,” "assume," and variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and involve risks, assumptions and uncertainties, including, but not limited to, the changes in vendor, payer and customer relationships and terms, competition, industry consolidation and the effects thereof, changes in economic and business conditions, risks associated with new business initiatives and activities, failure to obtain new contracts or extensions of existing contracts, and outcomes of legal and regulatory matters. These and other risks, assumptions and uncertainties are described in Item 1A (Risk Factors) of our most recent Annual Report on Form 10-K, which is incorporated herein by reference, and in other documents that we file or furnish with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by law, Walgreens does not undertake, and expressly disclaims, any duty or obligation to update publicly any forward-looking statement after the date of this report, whether as a result of new information, future events, changes in assumptions or otherwise.