Walgreens Boots Alliance, Inc. (WBA) has reported a 5.05 percent fall in profit for the quarter ended Nov. 30, 2016. The company has earned $1,054 million, or $0.97 a share in the quarter, compared with $1,110 million, or $1.01 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1,201 million, or $1.10 a share compared with $1,132 million or $1.03 a share, a year ago. Revenue during the quarter went down marginally by 1.83 percent to $28,501 million from $29,033 million in the previous year period. Gross margin for the quarter contracted 59 basis points over the previous year period to 24.97 percent. Total expenses were 94.92 percent of quarterly revenues, down from 94.94 percent for the same period last year. This has led to an improvement of 2 basis points in operating margin to 5.08 percent.
Operating income for the quarter was $1,447 million, compared with $1,468 million in the previous year period.
However, the adjusted operating income for the quarter was almost stable at $1,726 million when compared with the prior year period. At the same time, adjusted operating margin improved 14 basis points in the quarter to 6.06 percent from 5.92 percent in the last year period.
Executive Vice Chairman and chief executive officer Stefano Pessina said, "Overall we are pleased with the progress this quarter, with results in line with our expectations. We continue to anticipate that growth in the second half of fiscal 2017 will reflect the new strategic pharmacy partnerships we announced last year. As a result, we have raised the lower end of our fiscal year guidance by 5 cents per share. In addition, we continue to work toward closing the pending acquisition of Rite Aid Corporation in the early part of this calendar year."
For financial year 2017, Walgreens Boots Alliance, Inc. forecasts diluted earnings per share to be in the range of $4.90 to $5.20 on adjusted basis.
Operating cash flow drops significantly
Walgreens Boots Alliance, Inc. has generated cash of $525 million from operating activities during the quarter, down 28.28 percent or $ 207 million, when compared with the last year period. Cash flow from investing activities was $89 million for the quarter as against cash outgo of $271 million in the last year period. It has incurred capital expenditure of $352 million on net basis during the quarter, up 17.33 percent or $52 million from year ago period.
The company has spent $778 million cash to carry out financing activities during the quarter as against cash outgo of $853 million in the last year period.
Cash and cash equivalents stood at $9,598 million as on Nov. 30, 2016, up 273.46 percent or $7,028 million from $2,570 million on Nov. 30, 2015.
Working capital increases sharply
Walgreens Boots Alliance, Inc. has recorded an increase in the working capital over the last year. It stood at $8,939 million as at Nov. 30, 2016, up 166.28 percent or $5,582 million from $3,357 million on Nov. 30, 2015. Current ratio was at 1.50 as on Nov. 30, 2016, up from 1.20 on Nov. 30, 2015.
Cash conversion cycle (CCC) has decreased to 4 days for the quarter from 17 days for the last year period. Days sales outstanding were almost stable at 21 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 21 days for the quarter compared with 39 days for the previous year period. At the same time, days payable outstanding went up to 46 days for the quarter from 44 for the same period last year.
Debt increases substantially
Walgreens Boots Alliance, Inc. has witnessed an increase in total debt over the last one year. It stood at $18,872 million as on Nov. 30, 2016, up 32.18 percent or $4,595 million from $14,277 million on Nov. 30, 2015. Total debt was 26.24 percent of total assets as on Nov. 30, 2016, compared with 20.79 percent on Nov. 30, 2015. Debt to equity ratio was at 0.64 as on Nov. 30, 2016, up from 0.46 as on Nov. 30, 2015. Interest coverage ratio deteriorated to 8.36 for the quarter from 10.64 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
