Walgreens Boots Alliance profit hit by cost-cutting charges
Walgreens Boots Alliance reported plunging profit in the fourth quarter as the owner of UK high street giant Boots took a hit from cost-cutting charges.
Profit in the fourth-quarter plunged 55 per cent to $677m, compared to the same quarter in the previous year as the group closed stores.
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Net earnings per share fell 51.4 per cent to 75 cents per share in the three months to the end of August.
Operating income in the quarter fell 30.3 per cent to $700m, owing to lower gross margin and a 16.1 per cent impact from charges related to the cost-cut plan, the company said.
Sales in the fourth quarter were $34bn, an increase of 1.5 per cent.
The group announced plans to cut more costs, raising its annual cost savings target from in excess of $1.5bn to in excess of $1.8bn by 2022. The company has already announced plans to shutter 200 Boots stores across the UK in the next year.
Stefano Pessina, chief executive, said: “We are pleased to report riscal 2019 results in line with our previously stated guidance despite a challenging operating environment.
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“We are also making progress on our four strategic priorities, which we remain confident are positioning us to deliver long-term growth.
“While we still face headwinds, I am encouraged by the improvement in U.S. Comparable sales performance in the second half of fiscal 2019 and our progress in managing costs in order to save to invest to grow.”
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