Walgreens Reviews 2010 Performance at Annual Meeting

At Walgreens WAG WAG Annual Shareholders' Meeting today, Chairman Alan G. McNally, President and Chief Executive Officer Gregory D. Wasson, and Executive Vice President and Chief Financial Officer Wade D. Miquelon reviewed the company's performance and substantial progress throughout 2010, and outlined opportunities to grow and enhance value for shareholders. They also discussed the significant steps the company is taking to achieve its goal of being America's most trusted and convenient provider of consumer goods and services, and pharmacy, health and wellness solutions. McNally said, “Since Greg Wasson's appointment as CEO nearly two years ago, he has successfully led one of the most important strategic and operational transformations in Walgreens 110-year history. Greg has assembled a world-class leadership team and fostered a culture of innovation and operating excellence. Record free cash flow enabled us to return a record $2.2 billion to shareholders last year through dividends and share repurchases. This included a dividend increase of 27 percent last July, marking the 35th consecutive year that Walgreens increased its dividend and bringing our compound annual growth in dividends for the past eight years to nearly 22 percent.” Looking at the business environment, Wasson said, “Walgreens intends to benefit from the growing convergence of health care and retail services. Consumers today have greater access to health care information than ever before, allowing them to become more responsible for their own health and wellness decisions. As a result, patients are increasingly becoming shoppers of health care. That is a very favorable development for Walgreens as we evolve our business from the traditional retail drugstore model toward being America's No. 1 choice for health and daily living needs by offering the most comprehensive pharmacy, health and wellness solutions to patients and health care payers. With 32 million more Americans gaining access to health care coverage in 2014, we see substantial opportunities ahead.” At the meeting, the company highlighted its total shareholder return (which includes both stock price appreciation and dividends) over the past year of 12.3 percent compared with 13.4 percent for the S&P 500. And over the past two years since the company announced its transformational “plan to win,” total shareholder return was 61.7 percent compared with 49.6 percent for the S&P 500. Additional key highlights and milestones over the past year include: Sales for the fiscal year were a record $67.4 billion, a 6.4 percent increase, while operating income reached a record $3.5 billion. The company filled a record 778 million prescriptions in fiscal 2010 – up 7.5 percent from the previous year and representing 19.5 percent of all U.S. retail prescriptions. Walgreens acquired 258 Duane Reade drugstores in the New York City metro area, the largest acquisition in its history. Other acquisitions included Snyder's Drug Stores in Minnesota, Ike's and Super D drugstores in the Memphis area, and Eaton Apothecary pharmacies in the Boston area. More than 2,200 stores now feature the company's Customer Centric Retailing format, which has been well received by customers. Plans call for completion of the CCR rollout to approximately 5,500 stores by the end of calendar 2011. The company's 2009-10 flu shot campaign was named “Best Corporate Campaign” by the National Influenza Vaccine Summit. Walgreens and Take Care Clinics provided 5.4 million seasonal flu shots and 2 million H1N1 vaccinations. Walgreens launched its Optimal Wellness program, a self-care educational program for patients with chronic and complex medical conditions. The program is initially focusing on type 2 diabetes. The company expanded its sustainability efforts with several new programs in the past year, including opening the nation's first drugstore to utilize geothermal energy for heating and cooling, and launching the first ongoing, nationwide Safe Medication Disposal Program. Also, as a leader in retail use of solar energy, Walgreens now has nearly 80 solar energy systems active at locations in California, Connecticut, New Jersey and Oregon. Walgreens was named to Fortune magazine's list of Most Admired Companies in America for the 17th consecutive year, and was ranked 32nd on the Fortune 500 list of the largest U.S.-based companies. In addition, Fast Company magazine ranked Walgreens as the sixth most innovative health care company for leadership in health care services.