Walgreens Boots Alliance, Inc. (NASDAQ:WBA) Q2 2019 Earnings Conference Call - Final Transcript

Apr 02, 2019 • 08:30 am ET


Walgreens Boots Alliance, Inc. (NASDAQ:WBA) Q2 2019 Earnings Conference Call - Final Transcript


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Good morning. My name is Krista, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Walgreens Boots Alliance Inc., Second Quarter 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. And after the speakers' remarks, we will have a question-and-answer session [Operator Instructions] Thank you.I would turn the call over to your host, Gerald Gradwell, Senior Vice President of Investor Relations. Please go ahead.

Gerald Gradwell

Good morning, ladies and gentlemen, and welcome to our second quarter earnings call. I'm here today with Stefano Pessina, our Executive Vice Chairman and Chief Executive Officer of Walgreens Boots Alliance; James Kehoe, our Global Chief Financial Officer; and Alex Gourlay, Co-Chief Operating Officer of Walgreens Boots Alliance and President of Walgreens.

Our prepared comments are little longer than usual today so you should be aware that to provide the customary time for your questions, our call is likely to run at least 15 minutes past our normal one hour. Before I hand you over to Stefano to make some opening comments, I will, as usual, take you through the legal safe harbor and cautionary declarations.

Certain statements and projections of future results made in this presentation constitute forward-looking statements that are based on our current market, competitive and regulatory expectations, and are subject to risks and uncertainties that could cause actual results to vary materially.

Except to the extent required by the law, we undertake no obligation to update publicly any forward-looking statement after this presentation, whether as a result of new information, future events, changes in assumptions or otherwise. Please see our latest Form 10-K for a discussion of risk factors as they relate to forward-looking statements.

In today's presentation, we will use certain non-GAAP financial measures. We refer you to the appendix in the presentation materials available on our Investor Relations website for reconciliations to the most directly comparable GAAP financial measures and related information.

You will find a link to the webcast on our Investor Relations website at investor.walgreensbootsalliance.com. After this call, the presentation and webcast will be archived on the website for 12 months.

I will now hand you over to Stefano.

Stefano Pessina

Thank you, Gerald, and hello, everyone. I want to acknowledge upfront that this has been a very disappointing quarter for us. There is nothing entirely new in what we have seen impact our business during the quarter. Let's say, a number of the trends we had been expecting and preparing for, impacted us significantly more quickly than we had anticipated. We found ourselves facing a combination of increased reimbursement pressure in the quarter, lower generic deflation, lower brand inflation and slower than anticipated benefits from our counteract pressure in [Phonetic] our retail offering, primarily in the US.

Of course, the pharmacy trends are not only impacting our business, they are impacting the overall market and will likely continue to do so over the coming months. Let me be clear, however, I am convinced that