On Sept. 25, 2006, pharmacy Walgreen Co.
You're unlikely to see margins any more stable than Walgreen's, which suggests that the business model may have received all the efficiency improvements it could handle already.
- The massive cash flow boost stems from the large shift in accounts payable, which also balanced out higher receivables and inventories to produce a faster cash-cycle turnaround figure.
- Last year, Walgreen paid out $214.5 million of dividends, exceeding free cash flow by a fair margin, but there was ample free cash flow to finance the $263 million of shareholder payouts this year.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Avg. Est. |
FY 2006 |
FY 2005 |
Change |
|
|---|---|---|---|---|
|
Sales |
$47,220 |
$47,409.0 |
$42,201.6 |
12.3% |
|
Net Profit |
-- |
$1,750.6 |
$1,559.5 |
12.3% |
|
EPS |
$1.72 |
$1.72 |
$1.52 |
13.2% |
|
Diluted Shares |
1019.4 |
1028.3 |
(0.9%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
FY 2006 |
FY 2005 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
27.78% |
27.93% |
(0.15) |
|
Operating Margin |
5.70% |
5.74% |
(0.04) |
|
Net Margin |
3.69% |
3.70% |
(0.01) |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
FY 2006 |
FY 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$1,335.0 |
$1,071.6 |
24.6% |
|
Accounts Rec. |
$2,062.7 |
$1,396.3 |
47.7% |
|
Inventory |
$6,050.4 |
$5,592.7 |
8.2% |
|
Liabilities |
FY 2006 |
FY 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$4,039.2 |
$2,918.2 |
38.4% |
|
Long-Term Debt |
$0.0 |
$0.0 |
N/A |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
FY 2006 |
FY 2005 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$2,695.1 |
$1,371.2 |
96.6% |
|
Capital Expenditures |
$1,314.8 |
$1,222.0 |
7.6% |
|
Free Cash Flow |
$1,380.3 |
$149.2 |
825.1% |
Find out why Fools always follow the money.
Retail Checkup
|
FY 2006 |
FY 2005 |
Change |
|
|---|---|---|---|
|
Days in Inventory |
62.1 |
62.0 |
0.1 |
|
Days in Receivables |
13.3 |
11.1 |
2.2 |
|
Days Payables Outstanding |
37.1 |
24.0 |
3.2 |
|
Cash Conversion Cycle |
38.3 |
49.1 |
(10.8) |
Read up on cash conversion metrics.
Related Companies:
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CVS
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Wal-Mart
(NYSE:WMT) -
Target
(NYSE:TGT) -
Rite Aid
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Drugstore.com
(NASDAQ:DSCM) -
Kroger
(NYSE:KR)
Related Foolishness:
- Foolish Fundamentals: Cash Conversion Cycle
- Foolish Fundamentals: Inventory
- Foolish Fundamentals: The Cash Flow Statement
Wal-Mart is a Motley Fool Inside Value recommendation.
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
At the time of publication, Fool contributor Anders Bylund had no position in any company mentioned, though he is a frequent customer at several of their stores. Fool rules are here.
