Walgreens Boots Alliance has announced a ‘transformational’ US$1 billion cost-saving plan to enable it to meet its long-term targets.
The company announced the initiative in late December along with its first quarter results for fiscal 2019. The drugstore giant reaffirmed its outlook for the year ahead, predicting adjusted EPS growth of 7 to 12 percent at constant currency rates. Sales were up 9.9 percent to US$33.8 billion in the first quarter while adjusted EPS rose 14.1 percent to US$1.46.
“We are pleased to have delivered double digit percentage growth in earnings per share in the first quarter, including solid results in the US,” said Executive Vice Chairman and CEO, Stefano Pessina. “We continue to focus on and invest in transforming our business. We have made good progress on partnerships, including advancing our collaborations with Kroger, FedEx and Humana and, earlier this week, we announced an initiative with Verily to further expand our health care offering. Today we are reaffirming our fiscal 2019 guidance and announcing the launch of a new transformational cost management program, which is targeting annual cost savings of more than $1 billion by the end of the third year, to better position ourselves to meet our long-term targets.”
The program includes divisional optimization initiatives (which are already underway, global smart saving and smart organization programs, which will be focused initially on the company’s retail pharmacy USA and retail UK businesses as well as its global functions.