Revenue during the quarter went down marginally by 2.45 percent to $29,446 million from $30,184 million in the previous year period. Gross margin for the quarter contracted 39 basis points over the previous year period to 25.68 percent. Total expenses were 94.98 percent of quarterly revenues, up from 93.84 percent for the same period last year. That has resulted in a contraction of 114 basis points in operating margin to 5.02 percent.

Operating income for the quarter was $1,479 million, compared with $1,860 million in the previous year period.

However, the adjusted operating income for the quarter stood at $2,016 million compared to $2,120 million in the prior year period. At the same time, adjusted operating margin contracted 18 basis points in the quarter to 6.85 percent from 7.02 percent in the last year period.

Executive Vice chairman and chief executive officer Stefano Pessina said, "Our results this quarter were in line with our expectations despite some challenging conditions we faced in a number of markets. I am particularly pleased with the growth in pharmacy volume and market share in the Retail Pharmacy USA division, which saw the highest comparable prescription growth in more than seven years. At the same time, we continue to work toward gaining regulatory approval of the pending acquisition of Rite Aid Corporation by the end of July, consistent with the amended merger agreement announced in January."

For financial year 2017, the company projects diluted earnings per share to be in the range of $4.90 to $5.08 on adjusted basis.

The company has spent $197 million cash to meet investing activities during the first six months as against cash outgo of $552 million in the last year period. It has incurred net capital expenditure of $617 million on net basis during the first six months, up 7.87 percent or $45 million from year ago period.

The company has spent $1,122 million cash to carry out financing activities during the first six months as against cash outgo of $1,859 million in the last year period.

Cash and cash equivalents stood at $11,822 million as on Feb. 28, 2017, up 229.67 percent or $8,236 million from $3,586 million on Feb. 29, 2016.

Working capital increases sharply
Walgreens Boots Alliance, Inc. has recorded an increase in the working capital over the last year. It stood at $9,831 million as at Feb. 28, 2017, up 139.43 percent or $5,725 million from $4,106 million on Feb. 29, 2016. Current ratio was at 1.56 as on Feb. 28, 2017, up from 1.25 on Feb. 29, 2016.

Cash conversion cycle (CCC) has decreased to 7 days for the quarter from 17 days for the last year period. Days sales outstanding went down to 19 days for the quarter compared with 20 days for the same period last year.

Days inventory outstanding has decreased to 19 days for the quarter compared with 39 days for the previous year period. At the same time, days payable outstanding went up to 45 days for the quarter from 42 for the same period last year.