Walgreens Eyes Closing 2000-Plus Stores

Walgreens Boots Alliance (Deerfield, Ill.) is planning to close more of its roughly 8700 stores in the U.S., according to a variety of news sources, including The New York Times. The company first broached the topic in its most recent earnings release, then CEO Tim Wentworth elaborated on the closure plans in a conference call with stock analysts who follow the pharmacy giant.

First, in the news release, the company said it is “finalizing [a] significant multiyear footprint optimization program to close certain underperforming U.S. stores.” In its coverage of the follow-up analysts call, The Times noted that as of February, Walgreens had closed 625 U.S. stores, leaving it with about 8700 locales in the country. (Overall, the company has another 3800 locations in Europe and Latin America.)

And now, roughly a quarter of the pharmacy chain’s U.S. stores – those that the company doesn’t see as crucial to its long-term strategy – could be affected, Wentworth said. That translates to roughly 2175 stores.

“We witness continued pressure on the U.S. consumer,” Wentworth told investors during the earnings call. “Our customers have become increasingly selective and price-sensitive in their purchases.”

That’s reflected in Walgreens’ most recent quarter, which ended May 31. The company reported an adjusted earnings-per-share of 63 cents, down 36.6% on a constant currency basis compared to the year-ago quarter, including a $0.24 impact from what it described as “lower sale-leaseback gains, a challenging U.S. retail environment and recent pharmacy industry trends.”