Walgreens Says Pandemic Hurting Visits to Pharmacies

By Micah Maidenberg and Sharon Terlep

Pharmacy foot traffic is down as Covid-19 precautions thwart the seasonal flu and people skip routine medical care and generally avoid stores, Walgreens Boots Alliance Inc. executives said on Thursday.

The company said overall revenue expanded in the quarter ended Nov. 30 amid stronger sales for prescription medicines even as the pandemic continued to make some consumers hesitant to visit its stores. The quarterly results came a day after Walgreens agreed to sell its pharmacy wholesale unit for $6.5 billion.

The drugstore chain also said any gains it generates from providing Covid-19 vaccinations are likely to be offset by pandemic-related lockdows and restrictions. Walgreens is working with government officials to vaccinate residents and staff at more than 35,000 long-term-care facilities in 49 states, according to the company. It is also preparing for mass vaccinations at its retail locations later this year.

"We have the capacity and are ready to vaccinate tens of millions of Americans," said Alexander Gourlay, Walgreens co-chief operating officer. The company has 30,000 staff to assist with its effort and is seeking to increase that to 45,000 in the next three months, he said.

On Wednesday, CVS Health Corp., which is also providing the vaccines at long-term-care facilities, said some staffers at such sites had been hesitant to be vaccinated, slowing the rollout of the shots. CVS and Walgreens said they expected to deliver first doses at nursing homes by Jan. 25.

Of the more than 17 million doses of vaccines from Moderna Inc. and Pfizer Inc. with BioNTech SE that have been shipped, roughly 5.3 million have been administered, according to federal figures.

Walgreens said sales for its latest quarter rose to $36.31 billion from $34.34 billion a year ago.

Pharmacy sales in the U.S. were up 5% on a comparable basis but 0.4% for other items sold in its stores, like beauty or personal-care products.

The company's Boots U.K. branch also faced challenges tied to the coronavirus, with traffic at those shops weakening in November following the reintroduction of stricter restrictions. The British government this week ordered a new lockdown until mid-February amid the spread of a highly contagious new strain of the virus.

Deerfield, Ill.-based Walgreens reported a loss of $308 million, or 36 cents a share, for its fiscal first quarter, compared with a profit of $845 million, or 95 cents a share, for the year-earlier period.

The company said it recorded a charge of $1.73 a share tied to its investment in AmerisourceBergen Corp. during the latest quarter, weighing on earnings. Walgreens has a roughly 30% stake in the health-products distributor. On Wednesday, Walgreens agreed to sell the majority of its pharmacy wholesale unit to AmerisourceBergen.

Write to Micah Maidenberg at micah.maidenberg@wsj.com and Sharon Terlep at sharon.terlep@wsj.com

(END) Dow Jones Newswires

January 07, 2021 11:44 ET (16:44 GMT)

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