Walgreen's 4Q Profit Edges Higher

Monday, September 26th 2005, 10:43 am

By: News On 6

DEERFIELD, Ill. (AP) _ Walgreen Co., the nation's biggest drugstore chain, on Monday said fiscal fourth-quarter profit edged up just over 1 percent, hampered by a charge for expenses related to Hurricane Katrina.

Earnings for the June-through-August quarter were $329 million, or 32 cents per share, compared with $324.4 million, or 32 cents per share, in the same period a year earlier.

Results included a $54.7 million pretax charge for expenses from Katrina, which cut quarterly earnings by 3 cents per share. Excluding the charge, Walgreen earned $363.3 million, or 35 cents per share _ 2 cents less than the consensus estimate of Wall Street analysts surveyed by Thomson Financial.

Sales rose 11.3 percent to $10.49 billion from $9.43 billion a year ago.

Katrina shut down 74 stores, roughly half of which reopened within two weeks, though 32 stores remain closed in New Orleans and the surrounding area, Walgreen said.

The company continued its rapid expansion pace during the quarter. It operated 4,953 drugstores in 45 states and Puerto Rico as of Aug. 31, versus 4,582 a year ago. It projected $1.4 billion in capital investments for fiscal 2006.

``We're in excellent shape to continue our expansion plans while investing in new store technology and customer service initiatives,'' Chairman and CEO David Bernauer said.

For the full fiscal year, net earnings were $1.56 billion, or $1.52 per share, up 15.5 percent from $1.35 billion, or $1.31 per share, a year earlier. Sales rose 12.5 percent to $42.2 billion from $37.5 billion.