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• Sales Growth: Increased 6.9% on a constant currency basis across all segments.

• Adjusted EPS: $0.51, a decline of 23% year over year on a constant currency basis.

• GAAP Net Earnings: Included after-tax charges of $252 million related to Footprint Optimization Program.

• US Retail Pharmacy Comparable Sales: Grew 8.5%, driven by pharmacy sales.

• Pharmacy Comp Sales: Increased 12.7%, driven by brand inflation and script volume.

• US Retail Comparable Sales: Declined 4.6%, impacted by lower cough, cold, and flu season.

• International Sales Growth: 6.5% increase with Germany wholesale up 11.3% and Boots UK up 4.5%.

• Boots UK Comp Retail Sales: Increased 8.1% with gains across all categories.

• US Healthcare Sales: $2.2 billion, a 12% increase compared to the prior year quarter.

• Free Cash Flow Improvement: Benefited from decreased capital expenditures and higher adjusted operating income.

• Adjusted Operating Income (AOI): Decreased 36% versus the prior year quarter.

• Store Closures: Approximately 450 store closures sequenced as part of Footprint Optimization Program.

• Warning! GuruFocus has detected 6 Warning Signs with WBA.

Release Date: January 10, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Walgreens Boots Alliance Inc (NASDAQ:WBA) reported better-than-expected first-quarter results with a 6.9% increase in sales on a constant currency basis.

• The company maintained script market share in the US pharmacy segment and saw strong returns from its international business.

• Walgreens Boots Alliance Inc (NASDAQ:WBA) is executing a Footprint Optimization Program, which has shown early positive results, including better-than-expected script retention and employee engagement.

• The company has successfully renegotiated contracts with PBMs to better align reimbursement with costs, particularly for high-cost drugs.

• Walgreens Boots Alliance Inc (NASDAQ:WBA) improved free cash flow this quarter through decreased capital expenditures and higher adjusted operating income, excluding non-cash impacts.

Negative Points

• Adjusted EPS declined by 23% year over year, driven by prior year sale-leaseback gains and lower Cencora equity income.

• The US retail segment faced challenges with a 4.6% decline in comparable retail sales, impacted by lower consumer discretionary spending and a weaker cough, cold, and flu season.

• The company is facing ongoing pressure from accumulated inflation and higher interest rates affecting consumer behavior.

• Walgreens Boots Alliance Inc (NASDAQ:WBA) is still in the early stages of its turnaround strategy, indicating that substantial work remains to be done.

• The company is undergoing a sale process for noncore assets like VillageMD, with the intent to exit and redeploy proceeds to reduce net debt, highlighting ongoing restructuring challenges.