vaccine mandates helped boost results in Q4

Shares of Walgreens Boots Alliance Inc (NASDAQ: WBA) are up 2.0% in premarket trading after the company reported market-beating results for its fiscal fourth quarter on Thursday.

Walgreens’ financial performance in the fourth quarter

Walgreens reported $627 million in net income that translates to 72 cents per share. In the comparable quarter of last year, its net income was capped at a much lower $373 million or 43 cents a share. On an adjusted basis, the U.S. firm earned $1.17 per share.

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Walgreens generated $34.26 billion in sales versus the year-ago figure of $30.37 billion. According to FactSet, experts had forecast $1.02 in adjusted EPS on $33.03 billion in sales.

Other notable figures included an 8.1% increase in U.S. comparable pharmacy sales and an 8.9% increase in comparable retail sales. Boots UK comparable pharmacy sales grew 11.4% in the recent quarter, and comparable retail sales were up 15%.

Walgreens hit its target of slashing annual costs by $2 billion a year ahead of schedule, as per the earnings press release.

Highlights from CEO Brewer’s interview with CNBC’s Bertha Coombs

The pharmacy chain supplied 13.5 million doses of COVID-19 vaccinations in Q4 – twice as many as it had expected – that helped boost results. In and interview with CNBC’s Bertha Coombs, CEO Roz Brewer said:

There are many companies, cities, municipalities that are mandating vaccination. It’s forcing people to get the vaccine as they need to go to work. It is creating an increase, and we’re seeing that in our stores.

The delta variant also lifted demand for vaccination in the recent quarter, she added. Brewer agreed that supply chain and labour shortage issues were a concern for Walgreens as well. The company raised the minimum wage to $15/hour and offered bonuses to deal with the labour shortage.

Also on Thursday, Walgreens invested $5.2 billion to become the majority stakeholder in VillageMD.