Walgreens profit beats Street, drug chain to close 200 US stores

Walgreens Boots Alliance Inc reported a better-than-expected quarterly profit but said it would close about 200 stores in the United States as part of a restructuring plan aimed at cutting costs and streamlining its businesses.

Shares of the largest U.S. drugstore chain operator, which is reporting its first results after its merger with Europe's Alliance Boots in December, were up 2.8 percent at $90.12 in premarket trading on Thursday.

Walgreens Boots said on Thursday it would take a pre-tax charge of about $1.6 billion-$1.8 billion related to the restructuring.

The company reported a 35.5 percent rise in net sales to $26.6 billion for the second quarter ended Feb. 28.

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Analysts on average had expected sales of $27.77 billion, according to Thomson Reuters I/B/E/S.

Smaller rival Rite Aid Corp on Wednesday reported better-than-expected profit and same-store sales on higher prescription sales.

Same-store sales at Walgreens and Duane Reade stores open at least a year in the United States rose 6.9 percent, driven by a strong cough, cold and flu season, and continued growth in Medicare Part D prescriptions.

The U.S. retail pharmacy division made up for about 79 percent, or $21 billion, of total sales. Pharmacy sales accounted for 64.4 percent of U.S. sales.

Comparable store sales in international retail pharmacy division, which includes Boots stores in the UK, Thailand, Norway, Ireland, the Netherlands, Mexico and Chile, rose 2.9 percent in January and February.

Net income attributable to Walgreens Boots was $2.04 billion, or $1.93 per share. Walgreens alone earned $716 million, or 74 cents per share, in the year-earlier period.

Excluding items, Walgreens Boots earned $1.18 per share, beating analysts' average estimate of 95 cents.

The company also forecast full-year adjusted earnings of $3.45-$3.65 per share. Analysts on average were expecting a profit of $3.61 per share.

$1 = £0.68