Walgreens beats estimates on Omicron-led demand for vaccines, tests

March 31, 2022

(Reuters) – Walgreens Boots Alliance Inc reported higher-than-expected quarterly profit and sales on Thursday, boosted by a rush for COVID-19 vaccinations and testing during a recent Omicron-led surge in COVID-19 cases.

Governments and health authorities around the world continue to push for increased testing and vaccine booster doses as the highly transmissible Omicron sub-variant BA.2 has prompted surges in cases in many countries in Europe and Asia, and raised concerns over a potential new wave in the United States.

In the second quarter ended Feb. 28, Walgreens administered 11.8 million vaccinations and 6.6 million tests. The company has forecast 30 million vaccinations this year at its sites.

Shares of the drugstore chain were, however, marginally lower at $47.10 in volatile premarket trading, after Walgreens kept its 2022 forecast of low-single digit earnings growth unchanged.

The company’s U.S. pharmacy sales fell 3.3% in the quarter, hurt by a weak performance in its mail-order AllianceRx Walgreens business.

Total sales rose 3% to $33.77 billion, beating estimates of $33.40 billion.

Excluding items, the company earned $1.59 per share, compared with Refinitiv IBES estimates of $1.40 per share.

Walgreens said the strategic review of its UK-based Boots business, which began in January this year, was progressing.

(Reporting by Bhanvi Satija and Manas Mishra in Bengaluru; Editing by Shinjini Ganguli)