Walgreens Boots Alliance, Inc. (NASDAQ:WBA) Q2 2020 Earnings Conference Call - Final Transcript
Apr 02, 2020 • 08:30 am ET
[Operator Instructions] Your first question comes from George Hill from Deutsche Bank. Your line is open.
Good morning, team, and thank you very much for taking the questions and glad to hear that everybody is kind of sequestering themselves well to stay safe. And I appreciate all the color on March. I guess, Alex, and James, I'd ask, you talked about the acceleration in scripts sharply in the first part of the month in March and kind of falling down in the last week. I guess is there a way to normalize what the script trend looks like for March? And then if we look at the last week, has the growth just slowed or have scripts actually gone negative? And I have a very brief follow-up.
Hi, George. It's Alex here. It is really hard. I mean during the prepared remarks, James has given a lot of I think detail on what we know, and we don't have a lot to add to that. What we think has happened is people have to forward their scripts and got bigger quantities of scripts, just as the situation began to develop, particularly in the middle two weeks of March. And therefore, we think there has been some stockpiling, if you like, of prescriptions. But really it's too early to tell if there's any fundamental change to trends. We don't think there has been, but as we said in the prepared remarks, we really don't know yet. And of course, we're keeping a very close eye on the situation.
Yeah, it's a little tricky, but we estimate on a sales call adjusted basis, it's probably mid-single-digit, pretty similar to the second quarter. But a fairly significant uplift in the first 20 days of the month and falling off. It does fall off into negative territory, but that's actually a direct result of lower footfall and people actually respecting the instructions to stay at home. I think we'll get more stability as we look forward into the future months.
That's helpful. And then maybe a brief follow-up is, you guys have the benefit of doing business in some of the countries that are further off the infection curves as it relates to COVID-19. I guess, is there any way to extrapolate what has happened in countries like Italy, kind of into the United States and what those implications for the business would be?
I think you will find that money markets are quite different. And I'm not sure you should use them as analogs. So what we saw in China, which was the market that was first hit is, it's a business that was growing high-teens, a 4%. It ramped up at the peak of the crisis to be up in the 50% growth. And right now as it's back to stability, it's actually still growing very strongly, actually above high-teens. So I think what we've seen in China is remarkable. It is consistent and increased demand for pharmacy products. We don't have a