Walgreens announces plan to close 1,200 pharmacies

Walgreens plans to close about 1,200 stores over the next three years, as the pharmacy chain attempts to turn around its battered business.

The company said Tuesday that about 500 store closings will occur in the current fiscal year and should immediately help tighten profits and cash flow.

Leaders at Walgreens Boots Alliance Inc. said in late June that they were finalizing a turnaround plan for their business and that process could mean closing hundreds of underperforming stores.

The company, like its competitors, has had problems for years with strict reimbursement for the prescription drugs it sells, as well as other challenges such as the rising costs of operating its stores.

The Deerfield, Illinois, company is also backing out of a plan to add primary care clinics next to some of its stores after launching an aggressive expansion under former CEO Rosalind Brewer.

Walgreens said in August that it was reviewing its U.S. healthcare business and could sell all or part of its VillageMD clinic division. The announcement came less than two years after the company said it would invest millions in expanding the business.

The firm began 2024 by reducing the dividend it pays to shareholders to raise more cash to expand the business. It then lowered its fiscal 2024 earnings forecast in June.

Walgreens shares rose in early trading Tuesday.

Its shares had lost almost two-thirds of their value this year and had fallen to $9 by Monday’s close.

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