Walgreens Boots Alliance Q4 net earnings jumped to $1 billion
Staff Writer |
Walgreens Boots Alliance announced financial results for the fourth quarter and fiscal year 2016 that ended August 31, 2016.
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Q4 net earnings attributable to Walgreens Boots Alliance determined in accordance with GAAP were $1 billion compared with $26 million in the same quarter a year ago, while GAAP diluted net earnings per share were $0.95 compared with $0.02 in the same quarter a year ago.
The increases in GAAP net earnings and GAAP net earnings per share reflect fluctuations in the quarterly fair value adjustments of the company’s AmerisourceBergen Corporation warrants.
Adjusted fiscal 2016 fourth quarter net earnings attributable to Walgreens Boots Alliance1 increased 20.3 percent to $1.2 billion compared with the same quarter a year ago. Adjusted diluted net earnings per share for the quarter increased 21.6 percent to $1.07 compared with the same quarter a year ago.
Sales in the fourth quarter were $28.6 billion, an increase of 0.4 percent over the year-ago quarter, or 2.5 percent on a constant currency basis.
GAAP operating income in the fourth quarter was $1.1 billion, an increase of 36.4 percent from the same quarter a year ago. Adjusted operating income in the fourth quarter was $1.6 billion, an increase of 7.2 percent from the same quarter a year ago.
In June, as previously announced, the company achieved its goal set in 2012 to reach at least $1 billion in combined net synergies in fiscal 2016 relating to the strategic combination with Alliance Boots.
This excluded the synergy benefits relating to the company’s strategic, long-term relationship with AmerisourceBergen, the benefits of refinancing legacy Alliance Boots debt at a lower cost and the pending Rite Aid acquisition.
GAAP net cash provided by operating activities was $2.7 billion, and free cash flow was $2.2 billion, in the fourth quarter.
Overview of fiscal year results
Fiscal 2016 net earnings attributable to Walgreens Boots Alliance determined in accordance with GAAP decreased 1.1 percent to $4.2 billion, while GAAP diluted net earnings per share decreased 4.5 percent to $3.82 compared with the prior year.
The decrease reflects fluctuations in the fair value adjustments of the company’s AmerisourceBergen warrants and the prior year gain on the previously held equity interest in Alliance Boots, which was largely offset by increased operating income.
Adjusted net earnings attributable to Walgreens Boots Alliance1 in fiscal 2016 increased 22.6 percent to $5.0 billion compared with the prior year. Adjusted diluted net earnings per share in the fiscal year increased 18.3 percent to $4.59 compared with the prior year.
Sales increased 13.4 percent to $117.4 billion in fiscal 2016 compared with the prior year, due to the inclusion of Alliance Boots consolidated results for the entire period and an increase at Retail Pharmacy USA.
GAAP operating income in fiscal 2016 was $6.0 billion, an increase of 28.6 percent from the prior year. Adjusted operating income in the fiscal year was $7.2 billion, an increase of 17.1 percent from the prior year.
GAAP net cash provided by operating activities increased $2.2 billion to $7.8 billion, and free cash flow increased $2.1 billion to $6.5 billion compared with the prior year.
The company’s cost transformation program is on track to deliver $1.5 billion in savings by the end of fiscal 2017.
The company now estimates that total pre-tax charges to its GAAP financial results associated with the three-year restructuring program will be between $1.3 billion and $1.5 billion, which is $300 million lower than the previously estimated range. ■