- **Footprint Optimization Success**: 70 stores closed Q1 with 450+ planned FY25. Retained stores outperform closed by 250bps front-end and 390bps scripts. 
- **Pharmacy Efficiency Gains**: MFCs up 23% YoY, enabling +30% MTM services and 13% fill rate improvement. 
- **Reimbursement Wins**: 1/3 of payer contracts renegotiated with fairer terms, reducing margin pressure. 
- **Cash Flow Improvement**: $100M+ AOI benefit from closures, $150M+ CapEx reduction, and $500M+ working capital initiatives. 
- **Risk Management**: FY25 retail sales guidance lowered to -4% to -5% due to macro challenges, with NADAC impact capped at <$50M margin reduction.

**【CEO Strategic Overview】**
- **US Retail Pharmacy Stabilization**: Progressed Footprint Optimization Program, closing 70 stores Q1 with 450+ planned for FY25. Retained stores show 250bps higher front-end sales and 390bps scripts vs. closed stores. Script retention rates exceed historical norms. 
- **Employee Experience Enhancements**: Rolled out new scheduling optimization tools in 200+ stores, reducing labor inefficiencies while improving customer service. 
- **Pharmacy Operations Efficiency**: Micro Fulfillment Centers (MFCs) now serve 4,800 stores, with +23% volume YoY and 13% fill rate improvement. Vaccines administered and MTM services up significantly. 
- **Reimbursement Negotiations**: Completed 2025 payer contracts with rebalanced brand/generic mix, carve-outs for high-cost drugs, and expanded service compensation. 
- **Consumer Retail Strategy**: Introduced 60 new private-label products (17.8% penetration), optimized inventory for 4-year high in-stock rates, and expanded health-focused categories (women's wellness, sports nutrition). 
- **Non-Core Asset Management**: Initiated sale process for VillageMD and evaluating Summit options, with proceeds to reduce net debt.

**【CFO Financial Highlights】**
- **Topline Growth**: Q1 sales +6.9% YoY (constant currency), driven by US Healthcare (+12%) and International (+6.5%). Adjusted EPS $0.51 vs. $0.65 prior year (impacted by $184M prior year gains). 
- **US Retail Pharmacy**: AOI down 36% YoY (excluding prior year gains), offset by $100M expected AOI benefit from store closures. Pharmacy scripts +3.5% YoY, offset by margin pressure from brand inflation and reimbursement. 
- **US Retail Front-End**: Comparable sales -4.6% YoY due to 40% lower flu season and consumer channel shift. Adjusted GM down due to pricing/promotions. 
- **International Strength**: Boots UK comp sales +8.1%, Boots.com +23% YoY. Germany wholesale +11.3%. 
- **Cash Flow**: Operating cash flow negative due to seasonal inventory build, but FY25 guidance for $150M+ CapEx reduction and $500M+ working capital improvements.

**【Q&A Key Takeaways】**
- **Contract Negotiations**: 1/3 of payer book renegotiated with fairer reimbursement terms. 2025 contracts expected to reduce margin pressure vs. prior years. 
- **Procurement Progress**: Ongoing discussions with Cencora for competitive drug pricing, with incremental improvements in FY25. 
- **Store Closure Impact**: Working capital benefits and sale proceeds exceed closure costs, with $100M+ AOI benefit FY25. 
- **Pharmacy Margin Outlook**: NADAC changes expected to reduce margin by <$50M FY25. Vaccine volume decline offset by higher-margin COVID vaccines. 
- **Retail Sales Guidance**: FY25 retail comp sales now expected -4% to -5% vs. prior -2% to -3% due to macro challenges.


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