Walgreens Adding 15 New Drive-Thru COVID-19 Testing Sites on Heels of Sales Surge

Jamie Grill-Goodman
Editor in Chief
Jamie goodman

Walgreens is expanding drive-thru COVID-19 testing to 15 new sites in seven states: Arizona, Florida, Illinois, Kentucky, Louisiana, Tennessee and Texas.

“In coordination with the U.S. government health officials, we are working to provide drive-thru testing sites,” Alex Gourlay, co-COO & president, Walgreens Boots Alliance (WBA), said in a recent earnings call. “And in the UK, Boots is working with the NHS and Department of Health to provide COVID-19 testing for key workers and to provide support to a number of other ways during this crisis. And both Walgreens and Boots are providing customers with official government advice through dedicated emails, our websites and in-store information.”

The new U.S. testing sites will utilize Abbott’s new ID NOW COVID-19 test, which delivers positive results in as little as five minutes and negative results within 13 minutes. Walgreens plans to be able to test up to 3,000 people per day across these additional sites, which are expected to be activated beginning later this week. According to Gourlay, pilots in place in the Chicagoland area are doing about 150 tests a day.

WBA Q2 2020 highlights, year-over-year

  • Sales increased 3.7% to $35.8 billion, up 4.1% on a constant currency basis
  • Operating income decreased 18.7% to $1.2 billion; Adjusted operating income decreased 12% to $1.7 billion, on both a reported and constant currency basis
  • EPS decreased 14% to $1.07; Adjusted EPS decreased 7.3 percent to $1.52, on both a reported and constant currency basis

Walgreens will dedicate temporary space at select locations, outside of the stores, where Walgreens pharmacists will oversee the self-administration of the COVID-19 test. Soon, patients will be directed to testing locations via an online assessment tool that will be available on Walgreens.com and Walgreens mobile app.

The 15 locations are being finalized in collaboration with the U.S. Department of Health and Human Services (HHS), and are planned for select hot spot markets with escalating rates of COVID-19 cases.

“We’re continuing to do everything we can, both with our own resources and also by partnering with others, to serve as an access point within the community for COVID-19 testing,” said Richard Ashworth, Walgreens president, in press release. “Opening our first drive-thru testing location last month has allowed us to quickly learn and develop an efficient and scalable process, and we’re pleased to be working with Abbott to help accelerate our efforts, and to enable quick results for those being tested.”

Testing will be available at no cost to eligible individuals who meet criteria established by the Centers for Disease Control and Prevention (CDC). Patients will need to pre-register in advance in order to schedule an appointment for testing.

Walgreens’ same-store sales were up 26% in the first 21 days of March as people stocked up, global CFO James Kehoe said on the call, however, after the 21st, the comp sales trends turned negative with the last week of the month running at a mid-teens rate of decline.

“Obviously, if this trend continues for an extended period, it will quickly offset the sales uplift seen in the first 21 days of March,” he noted.

Walgreens’ comparable retail sales grew by around 14% in the month, led by 32% growth in health and wellness and 28% growth in grocery, partially offset by declines in discretionary categories such as beauty and seasonal. 

WBA said that given the many rapidly changing variables related to the pandemic, it’s not in a position to accurately forecast the future impacts. 

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