DEERFIELD, Ill. - (Business Wire) The board of directors of Walgreen Co. (NYSE: WAG) (NASDAQ: WAG) announced it has authorized a new $2 billion share repurchase program. The program, which expires at the end of 2013, replaces the previous $1 billion plan announced in January 2007 which had approximately $655 million remaining. Since 2004, Walgreens has repurchased more than $1.3 billion of common stock. The board also declared a regularly quarterly dividend of 13.75 cents per share, a 22.2 percent increase over the year-ago dividend, and set a long-term dividend payout target of 30 to 35 percent of net earnings.
Walgreens generated a record $4.1 billion in cash flow from operations in fiscal 2009 as a result of its stronger operating performance and improved working capital. “We remain confident in our growth strategy and ability to drive earnings growth, increase return on invested capital and generate strong cash flow,” said Walgreens President and CEO Greg Wasson. “With that, we have outlined a capital policy to provide further clarity on our future uses of cash.”
Capital Policy Guidelines
Walgreens is committed to:
- Maintaining a strong balance sheet and financial flexibility,
- Reinvesting in core strategies,
- Investing in strategic opportunities that reinforce its core strategies and meet return requirements, and
- Returning cash to shareholders from surplus cash flow in the form of dividends and share repurchases over the long term.
“This new capital policy demonstrates Walgreens ongoing commitment to delivering value to our shareholders,” said Wasson. “We are especially proud of our strong track record of consistently rewarding shareholders through dividends. In the last year, Walgreens paid more than $470 million in dividends to our shareholders. In addition, we have paid a dividend for 308 consecutive quarters and raised our dividend for 34 consecutive years.”
The announced regular quarterly dividend of 13.75 cents per share is payable Dec. 12, 2009 to shareholders of record Nov. 16, 2009.
Walgreens (www.walgreens.com) is the nation's largest drugstore chain with fiscal 2009 sales of $63 billion. The company operates 7,045 drugstores in all 50 states, the District of Columbia and Puerto Rico. Walgreens provides the most convenient access to consumer goods and services and cost-effective pharmacy, health and wellness services in America through its retail drugstores, Walgreens Health Services division and Walgreens Health and Wellness division. Walgreens Health Services assists pharmacy patients and prescription drug and medical plans through Walgreens Health Initiatives Inc. (a pharmacy benefit manager), Walgreens Mail Service Inc., Walgreens Home Care Inc., Walgreens Specialty Pharmacy LLC and SeniorMed LLC (a pharmacy provider to long-term care facilities). Walgreens Health and Wellness division includes Take Care Health Systems, the largest and most comprehensive manager of worksite health and wellness centers and in-store convenient care clinics, with more than 700 locations throughout the country.
(Please note: Stock exchanges typically set the ex-dividend date two business days before the shareholder-of-record date. This means if you purchase stock on the ex-dividend date or after, you will not receive the next dividend payment. If you purchase before the ex-dividend date, you will receive the dividend.)
This news release contains forward-looking statements that involve risks and uncertainties. The following factors, among others, could cause results to differ materially from management expectations as projected in such forward-looking statements: increasing competition; economic conditions; changes in third-party reimbursement levels; licensing and regulatory issues; the rate of generic introductions; the success of our acquisitions; and our credit ratings and access to credit. Investors are referred to the “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Walgreen’s most recent Form 10-K, which Note and Risk Factors are incorporated into this news release by reference.
Walgreen Co.
Michael Polzin
(847) 914-2920
http://news.walgreens.com
