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A handful of Walgreens retail pharmacy stores in Southern California are expected to close permanently.
The company plans to shut down five locations in Whittier, Los Angeles, Orange, Placentia and Stanton in late March, Walgreens confirmed to FOX Business.
“Increased regulatory and reimbursement pressures” impacting the “ability to cover” rent, staffing and supply costs played into the pharmacy store chain’s decision to shutter the locations, Walgreens said in a statement.
“When closures are necessary, like those here in California, we will work in partnership with community stakeholders to minimize customer disruptions,” the company said.
Walgreens unveiled a “footprint optimization program” last year that it said would entail shedding about 1,200 locations over a three-year period. (Joe Raedle/Getty Images / Getty Images)
Los Angeles Daily News earlier reported on the upcoming closures.
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A merchandise aisle and a prescription sign at a Walgreens store in New York City. (Lindsey Nicholson/UCG/Universal Images Group via / Getty Images)
This comes after news of a dozen Walgreens stores in San Francisco facing closure later this month. The company previously cited the impact of “increased regulatory and reimbursement pressures” on costs for those locations as well.
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Walgreens unveiled a “footprint optimization program” last year that it said would entail shedding about 1,200 locations over a three-year period. A total of roughly 500 will shutter in fiscal 2025, the company said at the time.
CEO Tim Wentworth said during the company’s first-quarter earnings call last month that the “cornerstone of our turnaround is stabilizing the U.S. retail pharmacy business” and that Walgreens “showed progress across several key planks of this plan,” including its footprint optimization program.
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He said the company “expect[s] our future footprint to support stronger performance.”
An exterior view of a Walgreens store in Mill Valley, California, is seen on Jan. 6, 2022. (Justin Sullivan/Getty Images / Getty Images)
“Currently, we see comparable front end sales in our retained store fleet outperforming those stores slated to close this year by approximately 250 basis points and comparable pharmacy scripts by approximately 390 basis points,” Wentworth said. “To be clear, even with our future footprint, we have to execute on our longer-term merchandising and consumer engagement initiatives in order to grow. However, this data supports our view that the smaller footprint will be a healthier one for our company.”
In the first quarter of fiscal 2025, Walgreens Boots Alliance generated $39.46 billion in sales. The company reported a net loss of $265 million, or 31 cents per share.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WBA | WALGREENS BOOTS ALLIANCE INC. | 9.47 | +0.11 | +1.18% |
