Walgreens is finalizing a plan to fix its U.S. business that could result in closing hundreds of additional stores over the next three years.
CEO Tim Wentworth told analysts Thursday morning that “changes are imminent” for about 25% of the company's stores, which he said were underperforming. The drugstore chain currently runs more than 8,600 in the United States.
Wentworth said the company's plan could include the closing of a “significant portion” of those roughly 2,100 underperforming stores if they don't improve.
Company leaders said they’ve already closed 2,000 locations over the last 10 years. Overall, the company runs about 12,500 drugstores worldwide.
"We are at a point where the current pharmacy model is not sustainable and the challenges in our operating environment require we approach the market differently," he said.
Walgreens and major competitors like CVS and Rite Aid — which is going through a bankruptcy reorganization — have been closing stores as they adjust to an array of challenges to their businesses. They include include years of tight reimbursement for their prescriptions and rising costs for running their locations.
Plus, analysts say they’ve also been hit by growing competition from Walmart, Amazon and other discount retailers over sales of goods sold outside their store pharmacies. Consumers also tend to grow more price conscious when inflation rises, and drugstores generally have higher prices than those discounters.
“Our customers have become increasingly selective and price sensitive in their purchases,” said Wentworth, who joined the company last fall and has been conducting a review of its business.
Walgreens also has been closing VillageMD primary care clinics it had been installing next to its stores in order to grow its presence as a health care provider. The company had launched an aggressive expansion of those clinics under previous CEO Rosalind Brewer. But Walgreens said in March that it was reversing course and closing around 160 of the clinics.
Primary care clinics like the ones VillageMD operate tend to lose money their first couple years as they build a patient base and improve health. Jefferies analyst Brian Tanquilut has said the new clinics were burning a lot of cash and racking up losses.
But Wentworth said Thursday those clinics were now on a “clearer path to profitability.”
The CEO also said his company is talking to pharmacy benefit managers to “ensure that we are paid fairly” and working to grow other parts of its business like specialty pharmacy. That helps people with complex or chronic medical conditions.
Walgreens Boots Alliance Inc. also reported that it missed earnings expectations and cut its annual forecast.
The company earned $344 million in its fiscal third quarter, with adjusted results totaling 63 cents per share. Revenue rose nearly 3% to $36.35 billion.
Analysts were looking for earnings of 68 cents per share on $35.9 billion in revenue, according to FactSet.
Walgreens now expects adjusted earnings to range from $2.80 to $2.95 for its fiscal year, which ends in August. That’s down from a forecast of $3.20 to $3.35 per share that it had narrowed in March.
Analysts expect $3.20 per share.
That guidance cut was not “overly shocking to us as the company now begins the next leg of its turnaround,” Leerink Partners analyst Michael Cherny said in a research note.
But the overall results surprised investors. Shares of the Deerfield, Illinois, company plunged 22% to end Thursday at $12.19, by far the stock's biggest single-day percentage decline on record. Walgreens' shares have already shed more than half their value so far this year.
FILE - A Walgreens store in Bradenton, Fla., is shown on Feb. 9, 2024. Walgreens is finalizing a plan to fix its business that could result in the closure of hundreds of additional stores in the next three years.(AP Photo/Gene J. Puskar, File)
NEW YORK (AP) — Video released late Saturday shows an officer in upstate New York fatally shooting a 13-year-old boy who had been tackled to the ground after he ran from police and pointed a replica handgun at them.
The teen was killed late Friday in Utica after officers in the city about 240 miles (400 kilometers) northwest of Manhattan stopped two youths a little after 10 p.m. in connection with an armed robbery investigation, police said.
The youths, both 13, matched the descriptions of the robbery suspects and were in the same area at around the same time the day after, police said. One was also walking in the road, a violation of state traffic law.
The body camera video released by police captures an officer saying he needs to pat them down to ensure they don't have any weapons in their possession. Immediately one of the two — identified by police as as Nyah Mway — runs away.
Authorities froze frames of the video where a running Nyah Mway appears to point the gun at the pursuing officers. Police also edited the video to insert a red circle around the weapon to show it to viewers.
The officers believed it was a handgun, police said, but it was later determined to be a replica of a Glock 17 Gen 5 handgun with a detachable magazine.
“During a ground struggle” with the teen, one of the officers fired a single shot that struck the boy in the chest, Williams said.
The teen was given “immediate” first aid by the officers and taken to Wynn Hospital, where he died, the chief said.
The replica gun carried by the teen “is in all aspects a realistic appearing firearm with GLOCK markings, signatures, detachable magazine, and serial numbers,” Lt. Michael Curley, a police spokesperson, said via email. “However ultimately it fires only pellets or BB’s.”
A bystander video posted to Facebook shows one of the officers chasing after Nyah Mway and tackling him to the ground. It also shows the officer punching the teen as two other officers arrive. A gunshot rings out as the teen is on the ground and the officers quickly stand up.
The officer who fired his gun was identified as Patrick Husnay, a six-year veteran of the agency. Husnay and Officers Bryce Patterson and Andrew Citriniti were placed on administrative leave with pay.
The police body camera video shows a chaotic scene.
Nyah Mway points the replica handgun at the officers while he runs from them. The officers scream “gun!” to each other as they run.
Patterson then tackles and punches Nyah Mway, and as the two are wrestling on the ground, Husnay opens fire.
Officers initially thought Nyah Mway may have shot himself, and Patterson says, “I don’t know if he shot me.” It is not clear whether he is referring to Nyah Mway or his fellow officer. Patterson was not struck.
Bystanders scream at the police throughout the recordings, and at one point an officer yells back: “We’re trying to save him right now!”
The other youth was detained in the back of a police vehicle and was not involved in the shooting.
The police department released the body camera videos following a public outcry as the shooting roiled Utica, a city of more than 65,000 located some 240 miles (400 kilometers) northwest of Manhattan. It is home to more than 4,200 people from Myanmar, according to The Center, a nonprofit that helps to resettle the refugees.
Nyah Mway, who local media reports said was an 8th grader at Donovan Middle School, has been identified as a refugee born in Myanmar and a member of the Karen ethnic minority.
Karens are an ethnic minority that are among the groups warring with the military rulers of the Southeast Asian country formerly known as Burma. The army ousted the elected government of Aung San Suu Kyi in 2021 and suppressed widespread nonviolent protests that sought a return to democratic rule.
During a tense news conference Saturday, Williams would not say what prompted police to stop the two youths or what the investigation concerned. The news conference ended early as Williams, the city’s mayor and an interpreter struggled to speak over repeated audience outbursts. Members of the community, including the youth’s family, were in attendance.
The police department is conducting its own internal investigation to see whether officers followed policies and training. The state attorney general will open its own case to determine if the shooting was justified.
“I want to offer my heartfelt condolences to the family of the deceased party during this difficult time,” Williams said. "This is a tragic and traumatic incident for all involved.”
Dazio reported from Los Angeles. Follow Philip Marcelo at twitter.com/philmarcelo.
This combination of images released by the Utica Police Department shows a replica of a Glock 17 Gen 5 handgun recovered after an officer fatally shot a 13-year-old boy who had been tackled to the ground after he ran from police and pointed the replica gun at them on Friday, June 28, 2024, in Utica, N.Y. (Utica, N.Y., Police Department via AP)
Utica Mayor Michael Galime, center right, grey jacket, talks with the family members of a 13-year-old boy who was fatally shot by a police officer Friday night after a news conference, Saturday, June 28, 2024 in Utica, N.Y. An officer shot and killed the teenager who was fleeing while wielding a “realistic appearing firearm," authorities said Saturday. (Kenny Lacy Jr./Syracuse.com via AP)
Police investigate the scene of Friday nights shooting in Utica, N.Y., early Saturday, June 29, 2024. An officer shot and killed a teen fleeing while pointing a replica gun, police said Saturday. (Kenny Lacy Jr./Syracuse.com via AP)
