By Mrinalika Roy and Dania Nadeem
(Reuters) - Drugstore chain Walgreens Boots Alliance (NASDAQ:WBA) Inc stuck to its full-year forecast for earnings growth on Thursday, despite anticipating a hit to its current-quarter earnings from the COVID-19 pandemic, sending its shares up nearly 3%.
The company has taken a number of steps to bolster profit after the health crisis hammered sales and forced it to cut jobs, shut some UK-based Boots stores and sell its distribution unit to AmerisourceBergen (NYSE:ABC) Corp for $6.5 billion.
The drugstore chain expects to see some benefit from COVID-19 vaccinations in the second half of fiscal year 2021, company executives said on a conference call, although that could be offset by the hit to its retail sales from the pandemic.
Walgreens and rival CVS Health Corp (NYSE:CVS) have an agreement with the federal government to vaccinate nursing home residents across the country through a voluntary program.
"The administration of vaccinations to care homes is not a particularly profitable business. It's extremely labor-intensive, and the costs are incremental," Chief Executive Officer Stephano Pessina said.
Walgreens maintained fiscal 2021 forecast of low single-digit growth in adjusted EPS, after it beat analysts' estimates for adjusted first-quarter profit, driven by higher sales at its retail pharmacy stores and robust prescription volumes.
Same-store sales at its U.S. pharmacies rose 3.7% in the quarter as it filled 297.3 million prescriptions. Boots UK pharmacies recorded a 2.5% rise in sales.
Excluding items, the company earned $1.22 per share, while analysts were expecting a profit of $1.03 per share, according to Refinitiv IBES.
Revenue rose to $36.31 billion from $34.34 billion.