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Walgreens Boots Alliance is off to a fast start on the transformational journey that chief executive officer Roz Brewer mapped out at the company’s investor conference last fall. Results for the first quarter of the fiscal year were impressive — sales rose 7.6% on a constant currency basis, while adjusted earnings per share increased 53%, topping the expectations of both Wall Street and WBA.
Of greater long-term significance, the company is putting the pieces in place to enhance its already formidable position in health care and retailing. Brewer, during a conference call with financial analysts, announced that WBA is making a $120 million incremental investment in its workforce, a move that supports the strategic objective of developing a high-performance culture. Recent additions to the management team, including chief customer officer Tracey Brown, furthered that effort.
Progress was also evident in other priority areas, including transforming and aligning core operations, and sharpening the focus of the company’s portfolio while optimizing capital allocation. The changes most likely to be noticed by customers, 92.4 million of whom are members of the myWalgreens loyalty plan, are the accelerating rollout of VillageMD clinics (which provide primary care delivered by physicians) and Walgreens Health Corners (where people can receive advice on their health, learn about digital health solutions and access routine diagnostic testing) to U.S. stores.
To date, 81 VillageMD at Walgreens centers have opened, and 47 Health Corners are now in operation. Brewer noted that those respective totals will exceed 160 and 100 by the end of 2022.
Brewer likes to relate the changes under way at WBA to the lives of patients. She cited the instance of a man in California who suffers from diabetes, and the difficulty he had in accessing A1c tests on a regular basis. The debut of a Walgreens Health Corner in his neighborhood removed that barrier. “As the Health Corners roll out, I have increased confidence that when executed at scale, this innovative and consumer-centric strategy will drive significant growth and value creation ahead,” Brewer said. “We are connecting our physical Health Corners with our digital app and our other unique complementary assets to meaningfully reduce cost and improve health outcomes and equity. And when you factor in the continued expansion of co-located clinics with VillageMD, nearly half of our footprint will be covered. We are building community engagement today as only Walgreens can do.”
