Walgreens Q2 2016 Earnings Review: Acquisition Synergies To Boost Margins Going Forward
Walgreens (NASDAQ:WBA), one of the largest pharmacies in the US released its Q2 2016 earnings on April 5th. (Fiscal years end with August.) The company reported a strong quarter driven by the acquisition of Alliance Boots and growth in Medicare Part D prescriptions . Following is a brief look at the numbers and trends that drove WBA’s performance in the second quarter.
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Factors That Will Drive Growth Going Forward
- Rite Aid’s acquisition (expected completion in second half of 2016) will add to the Retail Pharmacy USA business and help grow WBA’s market share
- High Comparable store sales will continue to positively impact revenues driven by the growing Medicare Part D priscriptions
- International Pharmacy and Pharmaceutical Wholesale business will continue to grow
- Higher synergy benefits expected from AmerisouceBergen and refinancing Alliance Boots Indebtedness at a lower cost
Offsetting Factor
- Generic Drugs will continue to adversely impact revenues
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com.
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our analysis for Walgreens
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