Walgreens announced Tuesday that it will close about 1,200 stores over the next three years, 500 of which will close this fiscal year.
The plan will free up cash flow and support adjusted earnings, according to a company press release.
“FY2025 will be a year in which we rebuild important foundations as we move forward with our strategy to drive value creation. This rebuilding will take time, but in the long term it will be economically viable and for consumers. We are confident that this will deliver significant benefits to Walgreens Boots Alliance,” Tim Wentworth, CEO of Walgreens Boots Alliance, said in a statement Tuesday.
The drugstore chain, like many of its competitors, is struggling amid rising operating costs and declining prescription reimbursements.
The company announced in June that it was finalizing cost-cutting plans that included closing hundreds of stores. The total of 1,200 stores scheduled to close over the next three years includes 300 stores approved in the plan earlier this year.
The drugstore chain announced a net loss of $3 billion, up from $180 million in the fourth quarter last year. Adjusted earningss The company said sales fell to $0.39, while fourth-quarter sales rose to $37.5 billion.
“Our fourth quarter and full-year 2024 financial results reflect our disciplined execution of cost management, working capital initiatives and capital expenditure reductions,” Wentworth said.
“In fiscal 2025, we will focus on stabilizing our retail pharmacy by optimizing our footprint, managing operating costs, and improving cash flow to support dispensing margins and maintain patient access for the future.” We are committed to continuing to work on our reimbursement model.,” he added.
