Shares in Walgreens Boots Alliance have jumped after the health and wellness retailer reported healthy earnings for the second quarter of 2015.
The company’s shares gained 2.78 percent to US$90.12 in pre-market trading on Thursday morning, following reports that second quarter sales grew by 35.5 percent to $26.6bn. Analysts are now expecting earnings of 95 cents per share, representing a 4.3 percent increase from last year.
Stefano Pessina, acting CEO of Walgreens Boots Alliance, stated, “This quarter marked a solid start for our new company, and I remain as optimistic as ever about our long-term future. At the same time, we understand the work that is needed to proactively address headwinds such as reimbursement pressure and competition. Our work includes several key areas of focus to create value.”
To drive up profitability further, Walgreens is launching a restructuring programme which will involve the closure of 200 US stores from August, saving the company an estimated US$1bn over three years.
“After a rigorous analysis, the company has identified additional opportunities for cost savings, primarily in its Retail Pharmacy USA division. These additional opportunities will increase the total expected cost savings program by $500 million to a projected $1.5 billion by the end of fiscal 2017,” Pessina added.