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Walgreens to reduce drug store growth

7/10/2008

DEERFIELD, Ill. Walgreens reported that it plans to reduce its organic drug store growth from about a 9% increase for the current fiscal 2008 year to about 6% in fiscal 2010 and to about 5% annual increases beginning in fiscal 2011.

Previously, the company had planned a long-term store growth rate of 8 %. New store openings that are already in the pipeline are expected to result in approximately 8% organic store growth in fiscal 2009.

According to Walgreens, its planned future expansion rates are the equivalent of opening about 495 net new organic stores in fiscal 2009, 425 in fiscal 2010 and 365 in fiscal 2011. These new growth targets resulted from the companys regular review of its growth and capital expenditure plans.

This move allows us to improve both return on invested capital and overall shareholder value, said Walgreens chairman and ceo Jeffrey Rein. At the same time, it gives us the flexibility to invest in our core strategies. 

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