Walgreens (NYSE: WAG), the nation's largest drugstore chain, will close 76 drugstores during the second half of fiscal 2014 in an effort to save $50 million annually. The company declined to specify which stores would close, saying that it would notify affected stores in the coming months.
"We won't be confirming those locations until we've notified employees at the stores first," said spokesman Michael Polzin.
In a conference call with analysts, CEO Greg Wasson said that most of the targeted locations exist near other Walgreens or have seen real estate values decline since they've opened. He also said that store employees will largely be reassigned.
Wasson said the closures affect less than 1 percent of Walgreens locations nationwide, and is part of an effort to "optimize our footprint and ensure our stores remain at the best corners of America." Walgreens operates 8,210 drugstores nationwide, 138 more than a year ago.
Walgreens also said on Tuesday that second quarter net income fell slightly to $754 million, down from $756 million in the same period a year ago. The company cited slower generic drug introductions, comparisons with last year's flu season and severe weather for the slide.
Walgreens' sales, however, rose 5.1 percent to $19.6 billion, with sales in stores open at least a year up 4.3 percent. Despite a 1.4 percent dip in customer traffic, the average purchase size rose 3.4 percent.
-See this Walgreens earnings call transcript
CVS quits selling cigarettes
CVS, Walgreens, Rite Aid offer prescription relief to newly-insured patients
Walgreens' new prescription text service is fast and pointless
Walgreens, Rite Aid post strong quarterly earnings
Walgreens November sales increase 4%