Deerfield, Ill. -- Walgreens on Tuesday reported a profit of $754 million for the second quarter, down from $756 million in the year-ago period, amid lower sales of generic drugs. The retailer also said it will close 76 locations in the second half, although it plans to increase its total store count by 55 to 75 by the end of the year.
Sales for the quarter ended Feb. 28 rose 5.1% to $19.6 billion, beating expectations. Prescription sales, which accounted for 62.2% of sales in the quarter, increased 7.0%.
Total same-store sales rose 4.3%, with a 2% increase in front-end sales and a 5.8% increase in comp Rx sales.
“Our second-quarter performance, in spite of expected headwinds from slower generic drug introductions, comparisons with last year's flu season and severe weather, was marked by solid top-line growth driven by record quarterly sales and record second-quarter prescriptions filled,” stated Greg Wasson, president and CEO Walgreens. “We also continued to gain prescription market share while we maintained a firm hold on our costs.”
Walgreens said that its 76 planned store closings were part of its efforts to optimize the company's asset base. Including these store closures, Walgreens still expects a net increase in its store count in fiscal 2014 of approximately 55-75 locations.
“While we seize the opportunity for store growth as the population ages and consumers look to community pharmacy for their healthcare needs, we also continue to focus on optimizing our assets and organization to position Walgreens for our future as a global company,” Wasson said.
In the second quarter, the company opened or acquired 28 new drug stores compared with 29 in the year-ago quarter.
As of Feb. 28, Walgreens operated 8,681 locations in all 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands. The company has 8,210 drug stores nationwide, 138 more than a year ago. Walgreens also operates worksite health and wellness centers, infusion and respiratory services facilities, specialty pharmacies and mail-service facilities. Its Take Care Health Systems subsidiary manages more than 700 in-store convenient care clinics and worksite health-and-wellness centers.