(FixThisNation.com) – On Thursday, Walgreens announced that they were going to be shutting down a “significant” number of stores across the United States that were underperforming. This is part of the footprint optimization program started by the company.
Walgreens did not provide specific information on how many of the 8,700 stores it currently operates will be affected. However, in a statement to the Wall Street Journal CEO Tim Wentworth argued that a “meaningful percent” of their locations would be closed.
On that same day, the company’s shares greatly fell following the company’s 2024 profit forecast being cut. In the past few years, there has been a reduction in shares of more than 45 percent. Wentworth in his statement noted that this continued to be a tough operating environment as there was a lot of pressure on consumers, and the pharmacy margins have been reduced because of the dynamics in the marketplace.
The company’s data has shown that stores open for at least a year have dropped by 2.3 percent when compared to the quarter of a year earlier. Walgreens has claimed that this is the result of the challenges in the retail environment. The company also pointed out that the retail margin has been negatively affected by the rise in promotional activity, the increase in thefts, and the general loss of inventory, as well as the higher shrink levels.
According to the newest estimates, the company is forecasted to end its adjusted earnings for this year at $2.80 to $2.95 per share, which is significantly lower than the original estimation of $3.20 to $3.35 a share.
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