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Walgreen's December same-store sales rise 0.4 pct.

Thu, 01/05/2012 - 4:45am
The Associated Press

Walgreen Co. said Thursday that sales at stores open at least a year increased 0.4 percent in December, beating analysts' estimates for a decline of 0.1 percent.

Front-end sales did the best, rising 0.6 percent. And though fewer customers came through the store, they bought more when they did. Traffic fell 0.6 percentage points, but the price of the average purchase rose 1.2 percent, the company said.

Pharmacy sales, which make up nearly 60 percent of total sales, rose 0.2 percent in stores open at least a year. Walgreen said those sales were hurt by more launches of generic drugs as well as a milder season for coughs, colds and the flu.

Total sales in December rose 2.7 percent from a year ago, to $6.98 billion.

Walgreen's dispute with Express Scripts, and the impact it will have on sales, overshadowed the revenue increases. Prescriptions filled fell 0.6 percent, and they could suffer more in January. That's because Express Scripts, an employee-benefits manager that paid Walgreen and other drugstores to fill prescriptions, had been fighting with Walgreen over reimbursement rates. Walgreen let its contract with Express Scripts expire on Dec. 31, saying it would rather give up the revenue it gets from that contract than continue filling unprofitable prescriptions.

Revenue at stores open at least a year is a key indicator of a retailer's health, because it excludes the impact of recently opened or closed stores.

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