WBA Latest Report

Financial Performance

Walgreens Boots' total operating revenue on November 30, 2024 was Rmb39.459 billion, up 7.03% from Rmb36.707 billion on November 30, 2023. Despite the growth in revenue, the company faces significant cost pressures and declining profitability.

Key Financial Data

1. Rising Sales Costs: Sales costs increased to Rmb32.680 billion in 2024 from Rmb29.937 billion in 2023, up 9.15%, indicating challenges in cost control.

2. Slight Increase in Gross Profit: Gross profit increased from Rmb67.710 billion to Rmb67.790 billion, with a small increase, indicating that the improvement in revenue did not significantly improve the gross margin level.

3. Larger Loss in Pre-Tax Profit: Pre-tax profit expanded from -Rmb0.352 billion to -Rmb5.390 billion, reflecting increased operating pressure.

4. Increased Marketing and Management Expenses: Marketing, sales, and management expenses in 2024 were Rmb7.015 billion, up 2.41% from Rmb6.851 billion in 2023, which may affect overall profitability.

5. Changes in Subsidiary Income: Subsidiary income changed from Rmb48 million to -Rmb10 million, indicating poor subsidiary operations, which may affect overall financial performance.

Industry Comparison

1. Overall Industry Analysis: The overall retail and pharmaceutical industry faced challenges in 2024, including rising costs and intensified competition. Many companies saw revenue growth, but the increase in costs and expenses suppressed profitability. Therefore, revenue growth in the industry may not necessarily translate into corresponding profit improvement.

2. Peer Comparison Analysis: Compared with other companies in the industry, Walgreens Boots achieved revenue growth, but due to rising costs and declining profitability, its overall financial health may not be as good as its competitors. Pay attention to the revenue and profit situation of other companies in the industry to assess Walgreens' relative performance.

Summary

Walgreens Boots' financial performance shows revenue growth, but the accompanying cost increases and declining profitability are a concern. Despite revenue improvement, the company's overall financial health is constrained by multiple factors, especially high sales costs and management expenses.

Opportunities

1. By optimizing cost structure and closing inefficient stores, Walgreens Boots has the potential to improve its profit fundamentals.

2. In the high-interest and persistent inflation environment, effective cost control will help improve the company's net margin.

3. With industry concentration, leading pharmacy chains have the opportunity to regain market share and improve operating efficiency.

Risks

1. Continued rising sales costs may further squeeze profit margins and affect the company's financial health.

2. Unstable subsidiary income may negatively impact overall financial performance.

3. Intensified competition and stricter policy regulations may lead to a loss of market share and increase operating pressure.