Walgreen August sales figure tops expectations

Walgreen key August sales figure rises 4.8 percent, topping analyst expectations

Associated Press

DEERFIELD, Ill. (AP) -- Walgreen's revenue from established stores climbed 4.8 percent in August, topping analyst expectations.

That includes a 6.4 percent gain from the pharmacy and a 2.2 percent increase from the front-end, or the rest of the store, the Deerfield, Ill., company said Thursday.

The total figure beat average analyst expectations for 2.9 percent rise, according to Thomson Reuters. The pharmacy performance also topped the average forecast for 3.7 percent increase, and front-end revenue beat expectations for 1.5 percent.

Revenue from stores open at least a year is a key indicator of a retailer's health, because it excludes the volatility associated with recently opened or closed stores.

A split with the nation's largest pharmacy benefits manager, Express Scripts Holding Co., hurt Walgreen in 2012, but it makes comparison to the previous August look good.

Express Scripts runs prescription drug plans for employers, insurers and other customers, handling prescriptions for millions of people. Walgreen did not fill prescriptions for Express Scripts for most of 2012 after a contract between the two companies expired.

Many Walgreen customers migrated to other drugstores. The companies renewed their ties last September.

Walgreen said Monday the percentage of Express Scripts prescriptions returning to its stores continued to climb in August, but it didn't offer specifics.

Generic drugs, which cost less than branded drugs, continue to hit the company's top line. But they boost profits because the fatten margins.

Total Walgreen revenue for August rose 6 percent to $6.17 billion.

The company's fourth-quarter sales rose 5 percent to $17.95 billion, and revenue from stores open at least one year rose 4.5 percent. FactSet says analysts expect the company to report $17.99 billion in total revenue for the period. For the year, revenue edged up 0.8 percent to $72.22 billion.

Walgreen Co. operates 8,117 drugstores in 50 states, the District of Columbia, Puerto Rico and Guam. Its shares closed at $49.49 Wednesday and rose 61 cents to $50.10 in premarket trading.

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