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Walgreens Boots Alliance Inc. pages available for free this week:
- Income Statement
- Statement of Comprehensive Income
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value to EBITDA (EV/EBITDA)
- Operating Profit Margin since 2005
- Return on Assets (ROA) since 2005
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Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities
Walgreens Boots Alliance Inc., adjustment to net earnings attributable to Walgreens Boots Alliance, Inc.
US$ in millions
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
- Reported Net Earnings
- The reported net earnings showed an overall increase from 2014 to 2019, with some fluctuations. Initially, earnings rose significantly from 1,932 million US dollars in 2014 to a peak of 4,220 million US dollars in 2015. This peak was followed by a slight decline in 2016 to 4,173 million and continued a mild downward trend to 4,078 million in 2017. In 2018, there was a notable increase to 5,024 million US dollars, representing the highest level within the observed period. However, this gain was not sustained into 2019, when reported net earnings decreased to 3,982 million US dollars.
- Adjusted Net Earnings
- The adjusted net earnings followed a pattern broadly similar to the reported net earnings, with values generally close throughout the period. Starting at 2,038 million US dollars in 2014, adjusted earnings also increased to a peak of 4,372 million in 2015. A decline occurred in the following years, dropping to 3,916 million in 2016 and then slightly increasing to 4,076 million in 2017. Adjusted net earnings reached their highest point in 2018, identical to the reported figure at 5,024 million US dollars, before decreasing in 2019 to 3,982 million US dollars as well.
- Comparison and Insights
- The close alignment of reported and adjusted net earnings suggests limited impact from adjustments in the reporting periods analyzed. Both metrics indicate a peak performance in 2018, which was followed by a significant reduction in 2019. The fluctuations within the six-year timeframe point to variability in earnings performance, possibly reflecting operational challenges, market conditions, or other influencing factors during the latter years of the period.
Adjusted Profitability Ratios: Mark to Market Available-for-sale Securities (Summary)
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
- Net Profit Margin
- The reported net profit margin experienced a generally fluctuating trend over the observed periods, starting at 2.53% in 2014 and rising to a peak of 4.08% in 2015. Subsequently, it declined slightly to 3.56% in 2016 and remained relatively stable around 3.45% in 2017. It then increased to 3.82% in 2018 before decreasing to 2.91% in 2019. The adjusted net profit margin demonstrated a similar pattern, indicating consistency between reported and adjusted figures, with the highest margins recorded in 2015 and 2018.
- Return on Equity (ROE)
- The reported ROE showed a rising trend from 9.44% in 2014 to a peak of 19.32% in 2018, reflecting increasing profitability relative to shareholder equity. The figure slightly declined to 16.94% in 2019. The adjusted ROE closely mirrored this pattern with marginally higher figures in early years, underlining strong performance improvements through 2018 followed by a modest downturn in the final period.
- Return on Assets (ROA)
- Reported ROA increased from 5.2% in 2014 to 7.37% in 2018, indicating improved asset efficiency over the period. It then declined to 5.89% in 2019. Adjusted ROA values were consistently slightly higher than reported figures in the initial years but converged in later periods, maintaining the same directional trend. This suggests that underlying operational efficiency improved until 2018 before dropping in 2019.
- Overall Observations
- The financial ratios demonstrate that profitability and efficiency metrics improved notably between 2014 and 2018, peaking around 2018 across all measures. However, 2019 reflects a reversal or decline in net profit margin, ROE, and ROA. Adjusted and reported figures are closely aligned throughout, implying limited impact from non-recurring items on profitability measurements. The decline in 2019 may indicate challenges in sustaining prior growth rates or possible operational or market headwinds in that year.
Walgreens Boots Alliance Inc., Profitability Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
2019 Calculations
1 Net profit margin = 100 × Net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Sales
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Sales
= 100 × ÷ =
- Net Earnings Trends
- Reported net earnings attributable to the company showed a significant increase from 1932 million USD in August 2014 to a peak of 5024 million USD in August 2018. However, the following year saw a notable decline to 3982 million USD. Adjusted net earnings followed a similar pattern, rising from 2038 million USD in 2014 to 5024 million USD in 2018, then decreasing to 3982 million USD in 2019. The alignment of reported and adjusted figures in 2018 and 2019 indicates consistency in earnings adjustments during these years.
- Net Profit Margin Trends
- The reported net profit margin increased from 2.53% in 2014 to 4.08% in 2015, before declining gradually to 2.91% in 2019. Adjusted net profit margin exhibited a similar trajectory, rising to 4.23% in 2015, then decreasing steadily to 2.91% by 2019. The convergence of reported and adjusted margins in the last two years reflects reduced discrepancies between reported and adjusted profitability metrics.
- Overall Financial Performance Insights
- The data reveals a strong upward trend in earnings and profitability until 2018, suggesting improving operational performance and possible favorable market conditions. The decline in both earnings and profit margins in 2019 points to potential challenges affecting profitability. The close alignment between reported and adjusted figures in later years may signify improved accounting consistency or diminished one-time adjustments.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
2019 Calculations
1 ROE = 100 × Net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Total Walgreens Boots Alliance, Inc. shareholders’ equity
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Total Walgreens Boots Alliance, Inc. shareholders’ equity
= 100 × ÷ =
The analysis of the financial data over the six-year period reveals several notable trends in the net earnings and return on equity (ROE) metrics.
- Net Earnings
- Reported net earnings attributable to the company show an overall increasing trend from 2014 to 2018, rising from $1,932 million in 2014 to a peak of $5,024 million in 2018. However, in 2019, there is a decline to $3,982 million, representing a significant drop from the prior year. Adjusted net earnings follow a similar pattern, closely aligned with reported net earnings except for 2016, where adjusted earnings are slightly lower than reported figures. The adjustment effect appears minimal in most years, indicating limited impact from non-recurring or exceptional items on the net earnings.
- Return on Equity (ROE)
- Both reported and adjusted ROE measure profitability relative to shareholders' equity. Reported ROE consistently improves from 9.44% in 2014 to a high of 19.32% in 2018, showing enhanced efficiency in generating profits from equity. In 2019, reported ROE decreases slightly to 16.94%, mirroring the decline in net earnings. Adjusted ROE follows a similar trajectory but is consistently slightly higher than reported ROE in earlier years until 2018. This suggests that adjustments positively affect perceived profitability in some periods. By 2019, both reported and adjusted ROE converge at the same rate, indicating alignment in performance assessment.
Overall, the data indicates strong growth in profitability and efficiency from 2014 through 2018, highlighted by increasing net earnings and ROE. The decline in 2019 suggests challenges that impacted earnings and returns. The adjustments applied to net earnings and ROE generally result in minor differences, confirming the trend seen in the reported figures. Continuous monitoring of these metrics will be necessary to assess whether the 2019 decrease is an anomaly or represents a longer-term shift in performance.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
2019 Calculations
1 ROA = 100 × Net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net earnings attributable to Walgreens Boots Alliance, Inc. ÷ Total assets
= 100 × ÷ =
- Net Earnings
- The reported net earnings exhibit an overall increasing trend from 2014 through 2018, rising from 1,932 million US dollars in 2014 to a peak of 5,024 million US dollars in 2018. However, in 2019, there is a noticeable decline to 3,982 million US dollars. Adjusted net earnings follow a similar pattern, with an increase from 2,038 million US dollars in 2014 to 5,024 million US dollars in 2018, then falling to 3,982 million US dollars in 2019. The adjusted figures closely mirror the reported earnings, indicating limited impact from adjustments during this period.
- Return on Assets (ROA)
- Reported ROA shows a consistent upward trend from 5.2% in 2014 to a peak of 7.37% in 2018, followed by a decline to 5.89% in 2019. The adjusted ROA aligns closely with reported figures, starting at 5.48% in 2014, reaching 7.37% in 2018, and decreasing to 5.89% in 2019. This suggests that underlying asset efficiency improved steadily over the period until 2018 before declining in the final year.
- Insights
- The data reveals progressive profitability growth over the five years ending in 2018, reflected in both net earnings and ROA measures. The consistent peak in 2018 followed by declines in 2019 may indicate challenges affecting financial performance in the latest year. The alignment between reported and adjusted figures suggests minimal impact from one-time or non-recurring items on bottom-line results and asset returns during this time frame.