News Column

Walgreens June Sales Decrease 6.8 Percent

July 6, 2012

Walgreens (NYSE: WAG) (NASDAQ: WAG) had June sales of $5.63 billion, a decrease of 6.8 percent from $6.04 billion for the same month in fiscal 2011. Compared with prior months during this calendar year, June sales comparisons were significantly impacted by calendar day shifts and an increase in generic drug introductions.

Total front-end sales increased 0.5 percent compared with the same month in 2011, while comparable store front-end sales decreased 1.0 percent. Customer traffic in comparable stores decreased 2.3 percent while basket size increased 1.3 percent.

Prescriptions filled at comparable stores decreased 11.9 percent in June. Calendar day shifts in June, which had one additional Friday and Saturday, and one fewer Wednesday and Thursday compared with June 2011, negatively impacted prescriptions filled in comparable stores by 2.3 percentage points. Lower incidence of flu negatively impacted comparable store prescriptions filled by 0.3 percentage point. The negative impact on comparable store prescriptions filled due to no longer being part of the Express Scripts Inc. pharmacy network was 10.7 percentage points. Prescriptions processed by Express Scripts comprised 12.6 percent of Walgreens prescriptions in June 2011.

June pharmacy sales decreased 10.7 percent, while comparable store pharmacy sales decreased 15.0 percent. Calendar day shifts negatively impacted pharmacy sales in comparable stores by 2.3 percentage points. Comparable store pharmacy sales were negatively impacted by 5.8 percentage points due to generic drug introductions in the last 12 months, by 0.7 percentage point due to the product mix of cough, cold and flu drugs and by 10.7 percentage points due to no longer being part of the Express Scripts network. Pharmacy sales accounted for 62.9 percent of total sales for the month.

Sales in comparable stores decreased by 10.0 percent. The effect of generic drug introductions in the last 12 months negatively impacted total comparable sales by 3.6 percentage points, while calendar day shifts negatively impacted total comparable sales by 1.4 percentage points.

Calendar year-to-date sales were $35.04 billion, a decrease of 3.0 percent from $36.11 billion in 2011.

Fiscal 2012 year-to-date sales for the 10 months were $60.19 billion, down 0.1 percent from $60.25 billion in fiscal 2011.

Walgreens opened 16 stores during June, including one relocation, acquired four stores and closed one.

At June 30, Walgreens operated 8,359 locations in all 50 states, the District of Columbia, Puerto Rico and Guam. That includes 7,907 drugstores, 174 more than a year ago, including 45 stores acquired over the last 12 months. The company also operates infusion and respiratory services facilities, specialty pharmacies and mail service facilities. Its Take Care Health Systems subsidiary manages more than 700 in-store convenient care clinics and worksite health and wellness centers.

Source: Copyright Business Wire 2012

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