Walgreens maintains full-year profit forecast; shares rise By Reuters

© Reuters. A sign rests on a counter at a Walgreens pharmacy store in Austin, Texas


(Reuters) – Walgreens Boots Alliance (NASDAQ:) Inc kept its full-year earnings forecast unchanged on Thursday, even as it anticipates a hit to current quarter earnings from the COVID-19 pandemic, sending its shares up nearly 4% in premarket trading.

The company has taken a number of steps to boost profit after the health crisis hammered sales and forced it to cut jobs, shut some UK-based Boots stores and sell its distribution unit to AmerisourceBergen (NYSE:) Corp for $6.5 billion.

Walgreens maintained fiscal 2021 forecast of low single-digit growth in adjusted EPS, after it beat analysts’ estimates for adjusted first-quarter profit driven by higher sales at its retail pharmacy stores and robust prescription volumes.

Same-store sales at its U.S. pharmacies rose 3.7% in the quarter as it filled 297.3 million prescriptions. Boots UK pharmacies recorded a 2.5% rise in the sales.

The company, which had been expecting a boost from distribution of COVID-19 vaccinations, said the opportunity is likely to be offset by the pandemic related lockdowns and restrictions.

Walgreens and rival CVS Health Corp (NYSE:) have an agreement with the federal government to vaccinate nursing home residents across the country through a voluntary program.

Lockdowns could result in a bigger hit to Walgreens’ profit compared to any boost from the company’s role in vaccine distribution, Chief Financial Officer James Kehoe said in October.

Excluding items, the company earned $1.22 per share, while analysts were expecting a profit of $1.03 per share, according to Refinitiv IBES.

Revenue rose to $36.31 billion from $34.34 billion.

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