Walgreens says staffing shortages hit prescription growth
Both the CEO and the CFO mentioned the staffing shortages
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| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WBA | WALGREENS BOOTS ALLIANCE INC. | 9.02 | -0.04 | -0.44% |
| CVS | CVS HEALTH CORP. | 59.85 | -0.11 | -0.18% |
| RAD | NO DATA AVAILABLE | - | - | - |
CEO Rosalind Brewer, speaking during Walgreens’ fourth-quarter earnings call, said the company has seen a "tightening in the labor market" for pharmacists and pharmacy technicians, creating staffing shortages in some of its markets.
The shortages are "creating a headwind for prescription growth," she said.
Walgreens CFO James Kehoe also noted the issue, saying, "Scripts remain challenged by temporary reductions in store operating hours due to staffing shortages."
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"Scripts were up, softer than expected, 1.4% in fiscal year 2022," Brewer noted during the call.
A curbside pickup sign outside a Walgreens location in Louisville, Ky. (Luke Sharrett/Bloomberg via Getty Images / Getty Images)
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"We are focusing investments to return about 3,000 stores to normal operating hours, which I expect will drive script volume recovery as we move through fiscal year 2023," she added. "We’re seeing positive staffing trends with 11 straight weeks of net pharmacists headcount increases."
An exterior view of a Walgreens store in Mill Valley, Calif., Jan. 6, 2022. (Justin Sullivan/Getty Images / Getty Images)
The company has also opened eight "automated micro-fulfillment centers" that support some 1,800 Walgreens stores and use robotics to complete some pharmacy-related tasks, the CEO said during the earnings call.
"Our pace is somewhat slower than expected in part due to supply-side construction delays, but I’m pleased with the performance of the centers we do have up and running," she said.
Pharmacist Kaitlin Harring, left, administers a Moderna COVID-19 vaccination to 3-year-old Fletcher Pack while he sits on the lap of his mother, McKenzie Pack, at Walgreens pharmacy June 20, 2022, in Lexington, S.C. (AP Photo/Sean Rayford / AP Newsroom)
In August, the Wall Street Journal reported the company was offering signing bonuses of up to $75,000 to pharmacists in certain U.S. markets to help address the staffing shortage. To receive the bonus, newly-hired pharmacists reportedly must remain working at Walgreens for at least 12 months.
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For the fourth quarter, Walgreens posted $32.4 billion in sales, down slightly from $34.26 billion during the same period last year. It posted a net loss of $415 million.
The company's U.S. retail pharmacy comparable prescriptions dropped 3.5%, and its comparable prescriptions, excluding immunizations, fell 0.1% in the fourth quarter compared to the same quarter last year. The quarter’s total filled prescriptions, including immunizations and adjusted to 30-day equivalents, was 298.7 million, a 4.4% decrease, the company said in its earnings release.
Its total fiscal 2022 sales increased slightly from 2021, rising to $132.7 billion from $132.5 billion.