Pharmacy USA continues to drive top line
As we’ve already seen in this series, Walgreens Boots Alliance’s (WBA) fourth quarter of fiscal 2018 sales increased 11% YoY (year-over-year) to $33.4 billion. As in the previous quarters, growth was driven by a strong performance of its Retail Pharmacy USA division.
The division accounted for 76% of fourth-quarter sales and recorded a 14.4% YoY increase in revenue to $25.5 billion. Fiscal 2018 sales increased 12.7% YoY and included organic sales growth of 3.4%.
Pharmacy sales increased 16.7% YoY during the quarter, driven by higher prescription volumes from the of Rite Aid acquisition and from the ongoing strength in the central specialty business. Comparable pharmacy sales increased 1.3% YoY as the positive impact of brand inflation was partially offset by reimbursement pressure and the impact of generics.
Walgreens filled ~280 million prescriptions (adjusted to 30-day equivalents), which was an increase of 11.8% YoY. Prescriptions filled at comparable stores increased 1.3% during the quarter.
Walgreens’s US retail sales increased 8.3% YoY, driven primarily by the acquisition of Rite Aid (RAD) stores. Comparable retail sales, however, declined for the ninth consecutive quarter and fell 1.9%. Softness in consumables and general merchandise and personal care products dragged down sales.
A look at WBA’s international businesses
Retail Pharmacy International sales declined 1.9% YoY to $2.9 billion. On a constant currency basis, sales were down 2.7% YoY, driven by a 3.4% fall in comparable pharmacy sales and a ~1% decline in comparable retail sales.
Pharmaceutical Wholesale revenue increased 2.3% YoY to $5.6 billion, driven by strong growth in emerging markets.
In the next part of this series, we’ll look at Walgreens’s margins and profitability for the fourth quarter of fiscal 2018.