Cover Page
Cover Page - shares | 9 Months Ended | |
May 31, 2021 | Jun. 30, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | May 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36759 | |
Entity Registrant Name | WALGREENS BOOTS ALLIANCE, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-1758322 | |
Entity Address, Address Line One | 108 Wilmot Road | |
Entity Address, City or Town | Deerfield | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60015 | |
City Area Code | 847 | |
Local Phone Number | 315-3700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 864,987,306 | |
Entity Central Index Key | 0001618921 | |
Current Fiscal Year End Date | --08-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Common Stock, $0.01 par value | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | WBA | |
Security Exchange Name | NASDAQ | |
3.600% Walgreens Boots Alliance, Inc. notes due 2025 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 3.600% Walgreens Boots Alliance, Inc. notes due 2025 | |
Trading Symbol | WBA25 | |
Security Exchange Name | NASDAQ | |
2.125% Walgreens Boots Alliance, Inc. notes due 2026 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 2.125% Walgreens Boots Alliance, Inc. notes due 2026 | |
Trading Symbol | WBA26 | |
Security Exchange Name | NASDAQ |
CONSOLIDATED CONDENSED BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 1,345 | $ 469 |
Accounts receivable, net | 5,153 | 4,110 |
Inventories | 8,333 | 7,917 |
Other current assets | 680 | 598 |
Assets of discontinued operations - current (see note 2) | 11,097 | 4,979 |
Total current assets | 26,607 | 18,073 |
Non-current assets: | ||
Property, plant and equipment, net | 12,450 | 12,796 |
Operating lease right-of-use assets | 21,874 | 21,453 |
Goodwill | 12,493 | 12,013 |
Intangible assets, net | 10,435 | 10,072 |
Equity method investments (see note 6) | 6,778 | 7,204 |
Other non-current assets | 1,282 | 581 |
Assets of discontinued operations - non-current (see note 2) | 0 | 4,983 |
Total non-current assets | 65,313 | 69,101 |
Total assets | 91,920 | 87,174 |
Current liabilities: | ||
Short-term debt | 7,963 | 3,265 |
Trade accounts payable (see note 17) | 11,290 | 10,145 |
Operating lease obligations | 2,327 | 2,358 |
Accrued expenses and other liabilities | 6,632 | 5,861 |
Income taxes | 71 | 95 |
Liabilities of discontinued operations - current (see note 2) | 6,191 | 5,347 |
Total current liabilities | 34,475 | 27,070 |
Non-current liabilities: | ||
Long-term debt | 7,732 | 12,203 |
Operating lease obligations | 22,088 | 21,765 |
Deferred income taxes | 1,309 | 1,367 |
Other non-current liabilities | 3,410 | 3,222 |
Liabilities of discontinued operations - non-current (see note 2) | 0 | 412 |
Total non-current liabilities | 34,539 | 38,968 |
Commitments and contingencies (see note 11) | ||
Total liabilities | 69,014 | 66,038 |
Redeemable noncontrolling interest | 310 | 0 |
Equity: | ||
Preferred stock $.01 par value; authorized 32 million shares, none issued | 0 | 0 |
Common stock $.01 par value; authorized 3.2 billion shares; issued 1,172,513,618 at May 31, 2021 and August 31, 2020 | 12 | 12 |
Paid-in capital | 10,971 | 10,761 |
Retained earnings | 34,908 | 34,210 |
Accumulated other comprehensive loss | (3,180) | (3,771) |
Treasury stock, at cost; 307,631,219 shares at May 31, 2021 and 306,910,099 shares at August 31, 2020 | (20,610) | (20,575) |
Total Walgreens Boots Alliance, Inc. shareholders’ equity | 22,101 | 20,637 |
Noncontrolling interests | 495 | 498 |
Total equity | 22,596 | 21,136 |
Total liabilities, redeemable noncontrolling interest and equity | $ 91,920 | $ 87,174 |
CONSOLIDATED CONDENSED BALANC_2
CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | May 31, 2021 | Aug. 31, 2020 |
Equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 32,000,000 | 32,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares (in shares) | 3,200,000,000 | 3,200,000,000 |
Common stock, issued (in shares) | 1,172,513,618 | 1,172,513,618 |
Treasury stock, at cost (in shares) | 307,631,219 | 306,910,099 |
CONSOLIDATED CONDENSED STATEMEN
CONSOLIDATED CONDENSED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Adoption of new accounting standards | Common stock | Treasury stock amount | Paid-in capital | Accumulated other comprehensive income (loss) | Retained earnings | Retained earningsAdoption of new accounting standards | Noncontrolling interests | Noncontrolling interestsAdoption of new accounting standards |
Beginning balance (in shares) at Aug. 31, 2019 | 895,387,502 | |||||||||
Beginning balance at Aug. 31, 2019 | $ 24,152 | $ (442) | $ 12 | $ (19,057) | $ 10,639 | $ (3,897) | $ 35,815 | $ (442) | $ 641 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | 68 | 83 | (16) | |||||||
Other comprehensive income (loss), net of tax | 31 | 27 | 4 | |||||||
Dividends declared | (1,254) | (1,211) | (43) | |||||||
Treasury stock purchases (in shares) | (27,023,145) | |||||||||
Treasury stock purchases | (1,374) | (1,374) | ||||||||
Employee stock purchase and option plans (in shares) | 1,814,352 | |||||||||
Employee stock purchase and option plans | 40 | 56 | (16) | |||||||
Stock-based compensation | 101 | 101 | ||||||||
Other | 2 | 2 | ||||||||
Ending balance (in shares) at May. 31, 2020 | 870,178,709 | |||||||||
Ending balance at May. 31, 2020 | 21,323 | $ 12 | (20,375) | 10,726 | (3,871) | 34,244 | 586 | |||
Beginning balance (in shares) at Feb. 29, 2020 | 880,397,199 | |||||||||
Beginning balance at Feb. 29, 2020 | 24,334 | $ 12 | (19,925) | 10,689 | (3,407) | 36,351 | 615 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | (1,726) | (1,708) | (18) | |||||||
Other comprehensive income (loss), net of tax | (474) | (463) | (11) | |||||||
Dividends declared | (399) | (399) | ||||||||
Treasury stock purchases (in shares) | (10,563,051) | |||||||||
Treasury stock purchases | (461) | (461) | ||||||||
Employee stock purchase and option plans (in shares) | 344,561 | |||||||||
Employee stock purchase and option plans | 13 | 12 | 1 | |||||||
Stock-based compensation | 35 | 35 | ||||||||
Other | 1 | 1 | ||||||||
Ending balance (in shares) at May. 31, 2020 | 870,178,709 | |||||||||
Ending balance at May. 31, 2020 | 21,323 | $ 12 | (20,375) | 10,726 | (3,871) | 34,244 | 586 | |||
Beginning balance (in shares) at Aug. 31, 2020 | 865,603,519 | |||||||||
Beginning balance at Aug. 31, 2020 | 21,136 | $ (6) | $ 12 | (20,575) | 10,761 | (3,771) | 34,210 | $ (3) | 498 | $ (3) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | 1,899 | 1,915 | (16) | |||||||
Other comprehensive income (loss), net of tax | 607 | 591 | 15 | |||||||
Dividends declared | (1,215) | (1,215) | ||||||||
Treasury stock purchases (in shares) | (3,000,000) | |||||||||
Treasury stock purchases | (110) | (110) | ||||||||
Employee stock purchase and option plans (in shares) | 2,278,880 | |||||||||
Employee stock purchase and option plans | 41 | 75 | (35) | |||||||
Stock-based compensation | 120 | 120 | ||||||||
Business combination | 120 | 120 | ||||||||
Other | 4 | 4 | 1 | |||||||
Ending balance (in shares) at May. 31, 2021 | 864,882,399 | |||||||||
Ending balance at May. 31, 2021 | 22,596 | $ 12 | (20,610) | 10,971 | (3,180) | 34,908 | 495 | |||
Beginning balance (in shares) at Feb. 28, 2021 | 864,394,418 | |||||||||
Beginning balance at Feb. 28, 2021 | 21,625 | $ 12 | (20,626) | 10,916 | (3,306) | 34,116 | 514 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | 1,173 | 1,197 | (24) | |||||||
Other comprehensive income (loss), net of tax | 131 | 127 | 4 | |||||||
Dividends declared | (405) | (405) | ||||||||
Employee stock purchase and option plans (in shares) | 487,981 | |||||||||
Employee stock purchase and option plans | 20 | 16 | 3 | |||||||
Stock-based compensation | 50 | 50 | ||||||||
Other | 2 | 2 | ||||||||
Ending balance (in shares) at May. 31, 2021 | 864,882,399 | |||||||||
Ending balance at May. 31, 2021 | $ 22,596 | $ 12 | $ (20,610) | $ 10,971 | $ (3,180) | $ 34,908 | $ 495 |
CONSOLIDATED CONDENSED STATEM_2
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Income Statement [Abstract] | ||||
Sales | $ 34,030 | $ 30,364 | $ 98,247 | $ 91,612 |
Cost of sales | 26,877 | 24,406 | 77,684 | 71,858 |
Gross profit | 7,153 | 5,959 | 20,564 | 19,753 |
Selling, general and administrative expenses | 6,116 | 7,884 | 17,936 | 19,663 |
Equity earnings (loss) in AmerisourceBergen | 97 | 243 | (1,196) | 284 |
Operating income (loss) | 1,134 | (1,683) | 1,432 | 374 |
Other income (expense) | 159 | (32) | 473 | 32 |
Earnings (loss) before interest and tax | 1,294 | (1,715) | 1,905 | 407 |
Interest expense, net | 545 | 148 | 817 | 463 |
Earnings (loss) before tax | 749 | (1,862) | 1,088 | (56) |
Income tax provision (benefit) | 246 | (43) | 81 | 129 |
Post tax earnings from other equity method investments | 575 | 6 | 604 | 5 |
Net earnings (loss) from continuing operations | 1,078 | (1,813) | 1,610 | (180) |
Net earnings from discontinued operations | 95 | 88 | 289 | 248 |
Net earnings (loss) | 1,173 | (1,726) | 1,899 | 68 |
Net (loss) attributable to noncontrolling interests - continuing operations | (27) | (20) | (25) | (23) |
Net earnings attributable to noncontrolling interests - discontinued operations | 2 | 2 | 9 | 7 |
Net earnings (loss) attributable to Walgreens Boots Alliance, Inc. | 1,197 | (1,708) | 1,915 | 83 |
Net earnings (loss) attributable to Walgreens Boots Alliance, Inc.: | ||||
Continuing operations | 1,105 | (1,794) | 1,636 | (157) |
Discontinued operations | 92 | 86 | 279 | 241 |
Total | $ 1,197 | $ (1,708) | $ 1,915 | $ 83 |
Basic earnings (loss) per common share: | ||||
Continuing operations (in dollars per share) | $ 1.28 | $ (2.05) | $ 1.89 | $ (0.18) |
Discontinued operations (in dollars per share) | 0.11 | 0.10 | 0.32 | 0.27 |
Total (in dollars per share) | 1.38 | (1.95) | 2.21 | 0.09 |
Diluted earnings (loss) per common share: | ||||
Continuing operations (in dollars per share) | 1.27 | (2.05) | 1.89 | (0.18) |
Discontinued operations (in dollars per share) | 0.11 | 0.10 | 0.32 | 0.27 |
Total (in dollars per share) | $ 1.38 | $ (1.95) | $ 2.21 | $ 0.09 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 864.7 | 875.4 | 864.7 | 883.7 |
Diluted (in shares) | 867 | 875.4 | 866.2 | 884.7 |
CONSOLIDATED CONDENSED STATEM_3
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Comprehensive income: | ||||
Net earnings (loss) | $ 1,173 | $ (1,726) | $ 1,899 | $ 68 |
Other comprehensive income (loss), net of tax: | ||||
Pension/postretirement obligations | (1) | (2) | 8 | (11) |
Unrealized gain (loss) on cash flow hedges | 8 | (5) | 21 | (4) |
Net investment hedges | (23) | 46 | (79) | 25 |
Unrealized gain (loss) on available for sale securities | 5 | 0 | 5 | 0 |
Share of other comprehensive income (loss) of equity method investments | (4) | (15) | 16 | (20) |
Currency translation adjustments | 146 | (498) | 636 | 41 |
Total other comprehensive income | 131 | (474) | 607 | 31 |
Total comprehensive income (loss) | 1,304 | (2,200) | 2,506 | 99 |
Comprehensive income (loss) attributable to noncontrolling interests | (19) | (29) | (1) | (12) |
Comprehensive income (loss) attributable to Walgreens Boots Alliance, Inc. | $ 1,323 | $ (2,171) | $ 2,506 | $ 110 |
CONSOLIDATED CONDENSED STATEM_4
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Cash flows from operating activities: | ||
Net earnings (loss) | $ 1,899 | $ 68 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 1,455 | 1,447 |
Deferred income taxes | (210) | (102) |
Stock compensation expense | 120 | 101 |
Equity (earnings) loss from equity method investments | 577 | (297) |
Goodwill and intangible impairments | 0 | 2,001 |
Loss on early extinguishment of debt | 419 | 0 |
Gain on sale of equity method investment | (290) | 0 |
Other | (141) | 305 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (897) | 141 |
Inventories | 71 | (227) |
Other current assets | 18 | 59 |
Trade accounts payable | 927 | (210) |
Accrued expenses and other liabilities | 428 | 569 |
Income taxes | 54 | (353) |
Other non-current assets and liabilities | (120) | (102) |
Net cash provided by operating activities | 4,310 | 3,398 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (1,001) | (962) |
Proceeds from sale-leaseback transactions | 662 | 557 |
Proceeds from sale of other assets | 406 | 52 |
Business, investment and asset acquisitions, net of cash acquired | (1,394) | (345) |
Other | (14) | 37 |
Net cash used for investing activities | (1,341) | (660) |
Cash flows from financing activities: | ||
Net change in short-term debt with maturities of 3 months or less | 1,556 | 196 |
Proceeds from debt | 12,720 | 16,336 |
Payments of debt | (11,050) | (16,871) |
Stock purchases | (110) | (1,374) |
Proceeds related to employee stock plans | 41 | 40 |
Cash dividends paid | (1,212) | (1,260) |
Early debt extinguishment | (3,687) | 0 |
Other | (114) | (66) |
Net cash used for financing activities | (1,856) | (2,998) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (55) | (3) |
Changes in cash, cash equivalents and restricted cash: | ||
Net increase (decrease) in cash, cash equivalents, and restricted cash | 1,058 | (263) |
Cash, cash equivalents and restricted cash at beginning of period | 746 | 1,207 |
Cash, cash equivalents and restricted cash at end of period | $ 1,803 | $ 943 |
Accounting policies
Accounting policies | 9 Months Ended |
May 31, 2021 | |
Accounting Policies [Abstract] | |
Accounting policies | Accounting policies Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2020. The coronavirus COVID-19 pandemic (“COVID-19”) has severely impacted the economies of the United States (“U.S.”), the United Kingdom (“UK”) and other countries around the world. The impact of COVID-19 on the Company’s businesses, financial position, results of operations and cash flows for the three months ended May 31, 2021, as well as information regarding certain expected or potential impacts of COVID-19 on the Company, is discussed throughout this Quarterly Report on Form 10-Q. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances including estimates of the impact of COVID-19. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors discussed throughout this Quarterly Report on Form 10-Q including, but not limited to, the severity and duration of COVID-19, the extent to which it will impact our customers, team members, suppliers, vendors, business partners and distribution channels. The Company assessed certain accounting matters that require consideration of estimates and assumptions in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of May 31, 2021 and through the date of this report. The accounting matters assessed included, but were not limited to, the Company’s carrying value of goodwill, intangible and other long-lived assets including operating lease right-of-use assets. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. The impact of COVID-19, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payer and customer relationships and terms, strategic transactions including acquisitions, dispositions, changes in laws and general economic conditions in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. On January 6, 2021, the Company entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with AmerisourceBergen Corporation (the “Transaction”). Pursuant to the terms and subject to the conditions set forth in the Share Purchase Agreement, AmerisourceBergen Corporation (“AmerisourceBergen”) agreed to purchase the majority of the Company's Alliance Healthcare business as well as a portion of the Company’s retail pharmacy international businesses in Europe (“Disposal Group”). The Disposal Group met the criteria to be reported as held for sale and discontinued operations. Therefore, effective as of the second quarter of fiscal 2021, the related assets, liabilities and operating results of the Disposal Group have been reported as discontinued operations for all periods. The majority of the Disposal Group was previously included in the Pharmaceutical Wholesale segment. Effective as of the second quarter of fiscal year 2021, the Company eliminated the Pharmaceutical Wholesale segment and aligned into two reportable segments: United States and International. See Note 15 Segment reporting for additional information on the segments. On June 1, 2021 the Company completed the Transaction. See Note 20 Subsequent events. Unless otherwise specified, disclosures in these Consolidated Condensed Financial Statements reflect continuing operations only. Certain prior period data, primarily related to discontinued operations, have been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. See Note 2 Discontinued operations for further information. Certain amounts in the Consolidated Condensed Financial Statements and associated notes may not add due to rounding. Percentages have been calculated using unrounded amounts for all periods presented. Adoption of new accounting pronouncements Financial instruments In March 2020, FASB issued ASU 2020-03. This ASU improves and clarifies various financial instruments topics. The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Investments - equity securities In April 2019, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-04, Codification Improvements to Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825). This extensive ASU provides clarifications for three topics related to financial instruments accounting, some of which apply to the Company. For example, this ASU clarifies the disclosure requirements that apply to equity securities without a readily determinable fair value for which the measurement alternative is elected. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Collaborative arrangements In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808). This ASU clarifies the interaction between Topic 808, Collaborative Arrangements, and Topic 606, Revenue from Contracts with Customers. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Compensation – retirement benefits – defined benefit plans In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement benefits (Topic 715-20). This ASU amends ASC 715 to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. The ASU eliminates the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as part of net periodic benefit cost over the next year. The ASU also removes the disclosure requirements for the effects of a one-percentage-point change on the assumed health care costs and the effect of this change in rates on service cost, interest cost and the benefit obligation for postretirement health care benefits. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Fair value measurement In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820). The ASU eliminates such disclosures as the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy. The ASU adds new disclosure requirements for Level 3 measurements. The Company adopted the new standard effective September 1, 2020 on a retrospective basis and the adoption of this ASU did not have any impact on the Company’s results of operations, cash flows or financial position. Financial instruments - credit losses In June 2016, the FASB issued ASU 2016-13: Measurement of Credit Losses on Financial Instruments (Topic 326), which amends the Board’s guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model that is based on expected losses rather than incurred losses, which is known as the current expected credit loss (“CECL”) model. The CECL model applies to most debt instruments (other than those measured at fair value), trade and other receivables, financial guarantee contracts, and loan commitments. The Company adopted the new standard effective September 1, 2020, using a modified retrospective transition method, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The adoption did not have a material impact on the Company’s financial position or results of operations. New accounting pronouncements not yet adopted Receivables - nonrefundable fees and others In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other. This ASU clarifies the accounting for the amortization period for certain purchased callable debt securities held at a premium by giving consideration to securities which have multiple call dates. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Effects of reference rate reform on financial reporting In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to above ASU to clarify certain optional expedients in Topic 848. The ASUs can be adopted no later than December 1, 2022 with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Investments — equity securities; Investments — equity method and joint ventures; Derivatives and hedging In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). The amendments in this ASU clarify the interaction between the accounting for investments in equity securities, investment in equity method and certain derivatives instruments. The ASU is expected to reduce diversity in practice and increase comparability of the accounting for these interactions. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Income taxes - simplifying the accounting for income taxes In December 2019, the FASB issued ASU 2019-12: Simplifying the Accounting for Income Taxes (Topic 740), which removes certain exceptions to the general principles in Topic 740 and improves consistent application of and simplifies GAAP for other areas of Topic 740 by clarifying and amending existing guidance. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022), and interim periods within those fiscal years, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's disclosures. |
Discontinued operations
Discontinued operations | 9 Months Ended |
May 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued operations | Discontinued operations On January 6, 2021, the Company entered into the Share Purchase Agreement with AmerisourceBergen. Pursuant to the terms and subject to the conditions set forth in the Share Purchase Agreement, AmerisourceBergen agreed to purchase the Disposal Group for approximately $6.5 billion, comprised of $6.275 billion in cash, subject to certain purchase price adjustments, and 2 million shares of AmerisourceBergen common stock. Alliance Healthcare’s investments in China and Italy and its operations in Germany are not included in the Disposal Group. The Company's retail pharmacy international operations in the Netherlands, Norway and Lithuania are included in the Disposal Group. On June 1, 2021 the Company completed the Transaction. See Note 20 Subsequent events. The Company classified assets and liabilities of the Disposal Group as held for sale in the Consolidated Condensed Balance Sheets at the lower of cost or fair value. Depreciation and amortization ceased on assets classified as held for sale. The Company allocated goodwill to the Disposal Group using relative fair value of the Disposal Group and businesses retained within the respective reporting units. The assets and liabilities and operating results of the Disposal Group are reported as discontinued operations, for all periods presented, as the disposition reflects a strategic shift that has, or will have, a major effect on the Company’s operations and financial results. Results of discontinued operations were as follows (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 5,500 $ 4,714 $ 16,070 $ 14,550 Cost of sales 4,956 4,235 14,486 13,089 Gross profit 544 479 1,584 1,461 Selling, general and administrative expense 394 381 1,211 1,173 Operating income from discontinued operations 150 98 373 288 Other expense (2) (2) (7) (6) Interest expense, net (13) (7) (23) (20) Earnings before income tax – discontinued operations 135 89 342 262 Income tax provision 44 3 68 24 Post tax earnings from other equity method investments 4 2 15 9 Net earnings from discontinued operations $ 95 $ 88 $ 289 $ 248 Sales from the Disposal Group to the Company's continuing operations are not eliminated and aggregate to (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 471 $ 448 $ 1,385 $ 1,370 The following table presents cash flows from operating and investing activities for discontinued operations (in millions): Nine months ended May 31, 2021 2020 Cash used in operating activities - discontinued operations $ (132) $ (157) Cash used for investing activities - discontinued operations (58) (42) Asset and liabilities of discontinued operations were as follows (in millions): May 31, 2021 August 31, 2020 Cash and cash equivalents $ 239 $ 47 Accounts receivable, net 3,524 3,022 Inventories 1,669 1,534 Other current assets 410 376 Property, plant and equipment, net 1 943 — Goodwill and intangibles 4,110 — Other assets 202 — Assets of discontinued operations - current $ 11,097 $ 4,979 Property, plant and equipment, net 1 $ — $ 816 Goodwill and intangibles — 3,936 Other non-current assets — 230 Assets of discontinued operations - non-current 2 $ — $ 4,983 Short term debt $ 366 $ 273 Trade accounts payables 4,608 4,313 Accrued expenses and other liabilities 759 746 Income taxes 11 14 Deferred income taxes 139 — Other liabilities 308 — Liabilities of discontinued operations - current $ 6,191 $ 5,347 Deferred income taxes $ — $ 131 Other non-current liabilities — 280 Liabilities of discontinued operations - non-current 2 $ — $ 412 1 Includes Operating lease right-of-use assets 2 Assets and liabilities of Disposal Group are presented as current, in the current period, as the Company completed the Transaction on June 1, 2021. See Note 6 Equity method investments and Note 17 Related parties for more information on the Company's equity method investment in AmerisourceBergen and the Company's continuing involvement. |
Acquisitions
Acquisitions | 9 Months Ended |
May 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions iA acquisition On December 29, 2020, the Company acquired a majority equity interest in Innovation Associates, Inc. for a cash consideration of $451 million. Innovation Associates, Inc. is a leading-edge provider of software enabled automation solutions for retail, hospital and federal healthcare and mail-order pharmacy markets. The Company accounted for this acquisition as a business combination and consolidates Innovation Associates, Inc. within the United States segment in its financial statements. Considering the contractual terms related to the noncontrolling interest, it is classified as redeemable noncontrolling interest in the Consolidated Condensed Balance Sheets. See Note 19 Supplemental information for more details on redeemable noncontrolling interest. The goodwill arising from this acquisition reflects the expected operational synergies and cost savings to be derived as a result of this acquisition. As of May 31, 2021, the Company had not completed the analysis to determine the fair value of the consideration paid or to assign fair values to all tangible and intangible assets acquired, and therefore the purchase price allocation has not been completed. The preliminary purchase price allocation will be subject to further refinement and may result in changes. These changes may relate to finalization of the fair value of the purchase consideration and the allocation of purchase consideration to all tangible and intangible assets acquired and identified. The following table summarizes the consideration for the acquisition and the preliminary amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions): Purchase Price Allocation: Total Consideration $ 477 Identifiable assets acquired and liabilities assumed Tangible assets $ 58 Developed technology and other intangibles 202 Liabilities (74) Total identifiable net assets $ 186 Non-controlling interest $ 103 Goodwill $ 394 Pro forma net earnings and sales of the Company, assuming the acquisition had occurred at the beginning of each period presented, would not be materially different from the results reported. The acquisition did not have a material impact on net earnings or sales of the Company for the three and nine months ended May 31, 2021. Pharmaceutical Wholesale business in Germany On November 1, 2020, the Company and McKesson Corporation closed a transaction to form a combined pharmaceutical wholesale business in Germany, as part of a strategic alliance. The Company owns a 70% controlling equity interest in the combined business which is consolidated by the Company and reported within the International segment in its financial statements. The Company accounted for this acquisition as a business combination involving noncash purchase consideration of $296 million consisting of the issuance of an equity interest in the combined business. As of May 31, 2021, the Company had not completed the analysis to determine the fair value of the consideration paid or to assign fair values to all tangible and intangible assets acquired, and therefore the purchase price allocation has not been completed. The preliminary purchase price allocation will be subject to further refinement and may result in changes. These changes may relate to finalization of the fair value of the purchase consideration consisting of the issuance of an equity interest in the combined business and the allocation of purchase consideration and the fair value assigned to all tangible and intangible assets acquired and identified. The following table summarizes the consideration for the acquisition and the preliminary amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions): Purchase Price Allocation: Total Consideration $ 331 Identifiable assets acquired and liabilities assumed Accounts receivable, cash and other assets $ 582 Inventories 470 Property, plant and equipment 125 Short term debt (296) Trade accounts payable, accrued expenses and other liabilities (374) Other noncurrent liabilities (197) Total identifiable net assets $ 311 Goodwill $ 21 A noncontrolling interest was recognized based on the Company's proportionate interest in the identifiable net assets of the combined business. The difference between the carrying amount of the non-controlling interest and the fair value of the consideration in the business combination is recognized as additional paid in capital. Considering the contractual terms related to the noncontrolling interest, it is classified as redeemable noncontrolling interest in the Consolidated Condensed Balance Sheets. See Note 19 Supplemental information for more details on redeemable noncontrolling interest. The following table represents supplemental unaudited condensed pro forma consolidated sales for the three and nine months ended May 31, 2021 and May 31, 2020, respectively as if the acquisition had occurred at the beginning of each period. The unaudited condensed pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company's results would have been had the acquisition occurred at the beginning of the periods presented or results which may occur in the future. Three months ended May 31, Nine months ended May 31, (in millions) 2021 2020 2021 2020 Sales $ 34,030 $ 31,827 $ 99,921 $ 95,999 Actual sales for the three and nine months ended May 31, 2021 included in the Consolidated Statement of Earnings are as follows: (in millions) Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 1,532 $ 3,571 Pro forma net earnings of the Company, assuming the acquisition had occurred at the beginning of each period presented, would not be materially different from the results reported. Other acquisitions The Company acquired certain prescription files and related pharmacy inventory primarily in the U.S. for the aggregate purchase price of $19 million and $85 million during the three and nine months ended May 31, 2021, respectively and $27 million and $166 million during the three and nine months ended May 31, 2020, respectively. |
Exit and disposal activities
Exit and disposal activities | 9 Months Ended |
May 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Exit and disposal activities | Exit and disposal activities Transformational Cost Management Program On December 20, 2018, the Company announced a transformational cost management program that was expected to deliver in excess of $2.0 billion of annual cost savings by fiscal 2022 (the “Transformational Cost Management Program”). The Company continues to expect to deliver in excess of $2.0 billion of annual cost savings by fiscal 2022 from continuing operations, after excluding amounts related to the Disposal Group. The Transformational Cost Management Program, which is multi-faceted and includes divisional optimization initiatives, global smart spending, global smart organization and the transformation of the Company’s information technology (IT) capabilities, is designed to help the Company achieve increased cost efficiencies. To date, the Company has taken actions across all aspects of the Transformational Cost Management Program. The actions under the Transformational Cost Management Program focus on the two reportable segments and the Company’s Corporate and global functions. Divisional optimization within each of the Company’s segments includes activities such as optimization of stores, including current plans to exit approximately 200 Boots stores in the UK and approximately 250 stores in the U.S. The Company currently estimates that the Transformational Cost Management Program will result in cumulative pre-tax charges to its GAAP financial results in continuing operations of approximately $2.1 billion to $2.3 billion, subject to approval of which $1.8 billion to $2.0 billion are expected to be recorded as exit and disposal activities. In addition to these impacts, as a result of the actions related to store closures taken under the Transformational Cost Management Program, the Company recorded $508 million of non-cash transition adjustments to decrease retained earnings due to the adoption of the new lease accounting standard that became effective on September 1, 2019. Since the inception of the Transformational Cost Management Program to May 31, 2021, the Company has recognized cumulative pre-tax charges to its financial results in accordance with GAAP of $1.2 billion, which were primarily recorded within selling, general and administrative expenses. These charges included $293 million related to lease obligations and other real estate costs, $245 million in asset impairments, $517 million in employee severance and business transition costs and $153 million of information technology transformation and other exit costs. Costs related to exit and disposal activities under the Transformational Cost Management Program for the three and nine months ended May 31, 2021 and May 31, 2020 were as follows (in millions): Three months ended May 31, 2021 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 15 $ 6 $ — $ 21 Asset impairments 5 9 — 14 Employee severance and business transition costs (19) 2 14 (2) Information technology transformation and other exit costs 1 10 11 Total pre-tax exit and disposal charges $ 2 $ 27 $ 14 $ 44 Nine months ended May 31, 2021 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 56 $ 6 $ — $ 62 Asset impairments 9 10 — 19 Employee severance and business transition costs 92 36 44 172 Information technology transformation and other exit costs 14 11 1 26 Total pre-tax exit and disposal costs $ 172 $ 63 $ 44 $ 279 Three months ended May 31, 2020 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 170 $ 3 $ — $ 173 Asset impairments 19 10 — 29 Employee severance and business transition costs 47 (2) 11 56 Information technology transformation and other exit costs 17 16 — 33 Total pre-tax exit and disposal charges $ 253 $ 27 $ 11 $ 290 Nine months ended May 31, 2020 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 179 $ 5 $ — $ 184 Asset impairments 31 13 — 44 Employee severance and business transition costs 111 33 18 162 Information technology transformation and other exit costs 27 26 12 65 Total pre-tax exit and disposal costs $ 348 $ 76 $ 31 $ 455 The changes in liabilities and assets related to the exit and disposal activities under Transformational Cost Management Program include the following (in millions): Lease obligations and other real estate costs Asset Impairments Employee severance and business transition costs Information technology transformation and other exit costs Total Balance at August 31, 2020 $ 19 $ — $ 166 $ 14 $ 199 Costs 62 19 172 26 279 Payments (47) — (183) (18) (249) Other (9) (19) (4) (12) (43) Currency 1 (1) 4 (2) 3 Balance at May 31, 2021 $ 26 $ — $ 155 $ 9 $ 190 Store Optimization Program On October 24, 2017, the Company’s Board of Directors approved a plan to implement a program (the “Store Optimization Program”) to optimize store locations through the planned closure of approximately 600 stores and related assets within the Company’s United States segment upon completion of the acquisition of certain stores and related assets from Rite Aid. The Company closed 769 stores and related assets. The actions under the Store Optimization Program commenced in March 2018 and were completed in the fourth quarter of fiscal 2020. Costs related to the Store Optimization Program for the three and nine months ended May 31, 2020 were $3 million and $24 million for lease obligation and other real estate costs and $7 million and $25 million for employee severance and other exit costs, respectively. The liabilities related to the Store Optimization Program as of May 31, 2021 and May 31, 2020 were not material. |
Leases
Leases | 9 Months Ended |
May 31, 2021 | |
Leases [Abstract] | |
Leases | LeasesThe Company leases certain retail stores, warehouses, distribution centers, office space, land and equipment. For leases in the U.S., the initial lease term is typically 15 to 25 years, followed by additional terms containing renewal options typically at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight-line basis over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based upon a portion of sales. Supplemental balance sheet information related to leases were as follows (in millions): Balance Sheet supplemental information: May 31, 2021 August 31, 2020 Operating Leases: Operating lease right-of-use assets $ 21,874 $ 21,453 Operating lease obligations - current 2,327 2,358 Operating lease obligations - non-current 22,088 21,765 Total operating lease obligations $ 24,416 $ 24,123 Finance Leases: Right-of-use assets included in: Property, plant and equipment, net $ 741 $ 766 Lease obligations included in: Accrued expenses and other liabilities 37 31 Other non-current liabilities 989 1,013 Total finance lease obligations $ 1,025 $ 1,044 Supplemental income statement information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2021 2020 2021 2020 Operating lease cost Fixed $ 807 $ 806 $ 2,406 $ 2,436 Variable 1 157 163 477 587 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 29 Interest 13 14 39 40 Sublease income 21 24 62 56 Impairment of right-of-use assets 8 170 23 182 Impairment of finance lease assets — 21 — 24 Gains on sale-leaseback transactions 2 85 84 273 224 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded within selling, general and administrative expenses. Other supplemental information related to leases were as follows (in millions): Nine months ended May 31, Other Supplemental Information: 2021 2020 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,562 $ 2,487 Operating cash flows from finance leases 36 36 Financing cash flows from finance leases 31 36 Total $ 2,629 $ 2,559 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 2,011 $ 1,917 Finance leases — 65 Total $ 2,011 $ 1,982 Average lease term and discount rate as of May 31, 2021 and August 31, 2020 were as follows: Weighted average terms and discount rates: May 31, 2021 August 31, 2020 Weighted average remaining lease term in years: Operating leases 10.4 10.7 Finance leases 20.4 20.6 Weighted average discount rate: Operating leases 4.93 % 4.97 % Finance leases 5.18 % 5.14 % The aggregate future lease payments for operating and finance leases as of May 31, 2021 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2021 (Remaining period) $ 23 $ 867 2022 92 3,403 2023 91 3,296 2024 92 3,169 2025 90 3,039 2026 90 2,911 Later 1,194 14,569 Total undiscounted minimum lease payments $ 1,672 $ 31,254 Less: Present value discount (647) (6,838) Lease liability $ 1,025 $ 24,416 |
Leases | LeasesThe Company leases certain retail stores, warehouses, distribution centers, office space, land and equipment. For leases in the U.S., the initial lease term is typically 15 to 25 years, followed by additional terms containing renewal options typically at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight-line basis over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based upon a portion of sales. Supplemental balance sheet information related to leases were as follows (in millions): Balance Sheet supplemental information: May 31, 2021 August 31, 2020 Operating Leases: Operating lease right-of-use assets $ 21,874 $ 21,453 Operating lease obligations - current 2,327 2,358 Operating lease obligations - non-current 22,088 21,765 Total operating lease obligations $ 24,416 $ 24,123 Finance Leases: Right-of-use assets included in: Property, plant and equipment, net $ 741 $ 766 Lease obligations included in: Accrued expenses and other liabilities 37 31 Other non-current liabilities 989 1,013 Total finance lease obligations $ 1,025 $ 1,044 Supplemental income statement information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2021 2020 2021 2020 Operating lease cost Fixed $ 807 $ 806 $ 2,406 $ 2,436 Variable 1 157 163 477 587 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 29 Interest 13 14 39 40 Sublease income 21 24 62 56 Impairment of right-of-use assets 8 170 23 182 Impairment of finance lease assets — 21 — 24 Gains on sale-leaseback transactions 2 85 84 273 224 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded within selling, general and administrative expenses. Other supplemental information related to leases were as follows (in millions): Nine months ended May 31, Other Supplemental Information: 2021 2020 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,562 $ 2,487 Operating cash flows from finance leases 36 36 Financing cash flows from finance leases 31 36 Total $ 2,629 $ 2,559 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 2,011 $ 1,917 Finance leases — 65 Total $ 2,011 $ 1,982 Average lease term and discount rate as of May 31, 2021 and August 31, 2020 were as follows: Weighted average terms and discount rates: May 31, 2021 August 31, 2020 Weighted average remaining lease term in years: Operating leases 10.4 10.7 Finance leases 20.4 20.6 Weighted average discount rate: Operating leases 4.93 % 4.97 % Finance leases 5.18 % 5.14 % The aggregate future lease payments for operating and finance leases as of May 31, 2021 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2021 (Remaining period) $ 23 $ 867 2022 92 3,403 2023 91 3,296 2024 92 3,169 2025 90 3,039 2026 90 2,911 Later 1,194 14,569 Total undiscounted minimum lease payments $ 1,672 $ 31,254 Less: Present value discount (647) (6,838) Lease liability $ 1,025 $ 24,416 |
Equity method investments
Equity method investments | 9 Months Ended |
May 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity method investments | Equity method investments Equity method investments as of May 31, 2021 and August 31, 2020, were as follows (in millions, except percentages): May 31, 2021 August 31, 2020 Carrying value Ownership percentage Carrying value Ownership percentage AmerisourceBergen $ 4,193 28% $ 5,446 28% Others 2,584 8% - 50% 1,758 8% - 50% Total $ 6,778 $ 7,204 AmerisourceBergen investment As of May 31, 2021 and August 31, 2020, the Company owned 56,854,867 AmerisourceBergen common shares, representing approximately 27.7% of its outstanding common stock based on the share count publicly reported by AmerisourceBergen in its most recent Quarterly Report on Form 10-Q. The Company accounts for its equity investment in AmerisourceBergen using the equity method of accounting, with the net earnings (loss) attributable to the Company’s investment being classified within the operating income of its United States segment. Due to the timing and availability of financial information of AmerisourceBergen, the Company accounts for this equity method investment on a financial reporting lag of two months. Equity earnings (loss) from AmerisourceBergen are reported as a separate line in the Consolidated Condensed Statements of Earnings. During the nine months ended May 31, 2021, the Company recognized equity losses in AmerisourceBergen of $1,196 million, which included a loss of $1,373 million recognized during the three months ended November 30, 2020. These equity losses were primarily due to AmerisourceBergen's recognition of $5.6 billion, net of tax, and charges related to its ongoing opioid litigation in its financial statements for the three months period ended September 30, 2020. The Level 1 fair market value of the Company’s equity investment in AmerisourceBergen common stock at May 31, 2021 was $6.5 billion. As of May 31, 2021, the carrying value of the Company’s investment in AmerisourceBergen exceeded its proportionate share of the net assets of AmerisourceBergen by $4.2 billion. This premium of $4.2 billion was recognized as part of the carrying value in the Company’s equity investment in AmerisourceBergen. The difference was primarily related to goodwill and the fair value of AmerisourceBergen intangible assets. On January 6, 2021, the Company entered into a Share Purchase Agreement with AmerisourceBergen pursuant to which AmerisourceBergen agreed to purchase the majority of the Company's Alliance Healthcare business. See Note 2 Discontinued operations for additional information. On June 1, 2021, the Company completed the sale and received $6.275 billion in cash, subject to certain purchase price adjustments, and 2 million shares of AmerisourceBergen common stock. After giving effect to the Transaction, the Company beneficially owns approximately 28.4% of AmerisourceBergen’s outstanding common stock, based on the share count publicly reported by AmerisourceBergen in its most recent Quarterly Report on Form 10-Q. See Note 20 Subsequent events. Other investments The Company’s other equity method investments include its investments in the U.S. which include VillageMD, BrightSpring Health Services (previously PharMerica Corporation), Shields Health Solutions and the Company's investment in HC Group Holdings I, LLC (“HC Group Holdings”) which owns equity interest in Option Care Health and the Company's China investments in Sinopharm Medicine Holding Guoda Drugstores Co., Ltd, Guangzhou Pharmaceuticals Corporation and Nanjing Pharmaceutical Company Limited. The Company reported $575 million of post-tax equity earnings and $6 million of post-tax equity earnings from other equity method investments for the three months ended May 31, 2021 and May 31, 2020, respectively. The Company reported $604 million of post-tax equity earnings and $5 million of post-tax equity earnings from other equity method investments for the nine months ended May 31, 2021 and May 31, 2020, respectively. During the three and nine months ended May 31, 2021, the Company recorded a gain of $98 million and $290 million, respectively, in Other income due to partial sale of ownership interest in Option Care Health by the Company's equity method investee HC Group Holdings. During the three months ended May 31, 2021, as a result of these sales, our equity method investee HC Group Holdings lost the ability to control Option Care Health and, therefore, deconsolidated Option Care Health in its financial statements. As a result of this deconsolidation, HC Group Holdings recognized a gain of $1.2 billion and the Company recorded its share of equity earnings in HC Group Holdings of $576 million during the three months ended May 31, 2021, in Post tax earnings from other equity method investments. Summarized financial information Summarized financial information for the Company’s equity method investments in aggregate is as follows: Statements of earnings (loss) (in millions) Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 55,890 $ 52,772 $ 171,417 $ 157,382 Gross profit 2,558 2,253 7,647 6,476 Net earnings (loss) 489 912 (3,841) 1,268 Share of earnings (loss) from equity method investments 672 249 (591) 289 |
Goodwill and other intangible a
Goodwill and other intangible assets | 9 Months Ended |
May 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets | Goodwill and other intangible assets Goodwill and indefinite-lived intangible assets are evaluated for impairment annually during the fourth quarter, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit or intangible asset below its carrying value. Based on the analysis completed during fiscal 2020, as of the June 1, 2020 valuation date, the fair values of the Company’s reporting units exceeded their carrying amounts ranging from approximately 4% to approximately 239% excluding Boots reporting unit for which the excess of fair value over carrying amount was nominal due to an impairment charge recognized during the three months ended May 31, 2020. Other international reporting unit's fair value was in excess of its carrying value by approximately 4%. The fair values of the indefinite-lived trade name intangibles within the Boots reporting unit exceeded their carrying value amounts ranging from approximately 4% to approximately 31%, except for certain Boots trade name assets impaired during the three months ended May 31, 2020 and pharmacy licenses impairment during the year end August 31, 2019. As of May 31, 2021, the carrying values of goodwill were $1.1 billion and $0.4 billion for the Boots reporting unit and Other international reporting unit, respectively. As of May 31, 2021, the carrying value of the indefinite-lived intangibles within the Boots reporting unit was $7.7 billion. The determination of the fair value of the reporting units requires the Company to make significant estimates and assumptions including with respect to the business and financial performance of the Company’s reporting units, as well as how such performance may be impacted by COVID-19. Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions, including the impact of COVID-19, could have a significant impact on either the fair value of the reporting units and indefinite-lived intangibles, the amount of any goodwill and indefinite-lived intangible impairment charges, or both. These estimates can be affected by a number of factors including, but not limited to, the impact of COVID-19, its severity, duration and its impact on global economies, general economic conditions as well as our profitability. The Company will continue to monitor these potential impacts, including the impact of COVID-19 and economic, industry and market trends and the impact these may have on the Boots and Other international reporting units. Changes in the carrying amount of goodwill by reportable segment consist of the following (in millions): Goodwill rollforward: United States International Walgreens Boots Alliance, Inc. August 31, 2020 $ 10,553 $ 1,460 $ 12,013 Acquisitions 394 21 416 Currency translation adjustments — 65 65 May 31, 2021 $ 10,947 $ 1,547 $ 12,493 The carrying amount and accumulated amortization of intangible assets consist of the following (in millions): Intangible assets May 31, 2021 August 31, 2020 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 3,581 $ 3,502 Trade names and trademarks 373 348 Purchasing and payer contracts 337 337 Others 2 218 60 Total gross amortizable intangible assets $ 4,510 $ 4,247 Accumulated amortization Customer relationships and loyalty card holders 1 $ 1,306 $ 1,089 Trade names and trademarks 226 196 Purchasing and payer contracts 185 95 Others 2 32 26 Total accumulated amortization 1,749 1,406 Total amortizable intangible assets, net $ 2,761 $ 2,841 Indefinite-lived intangible assets Trade names and trademarks $ 5,526 $ 5,203 Pharmacy licenses 2,148 2,028 Total indefinite-lived intangible assets $ 7,675 $ 7,231 Total intangible assets, net $ 10,435 $ 10,072 1 Includes purchased prescription files. 2 Includes acquired developed technology and non-compete agreements. Amortization expense for intangible assets was $156 million and $363 million for the three and nine months ended May 31, 2021, respectively, and $94 million and $290 million for the three and nine months ended May 31, 2020, respectively. Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2021 is as follows (in millions): 2022 2023 2024 2025 2026 Estimated annual amortization expense $ 439 $ 336 $ 317 $ 289 $ 262 |
Debt
Debt | 9 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt carrying values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated debt is translated using the spot rates as of the balance sheet date. Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2021 August 31, 2020 Short-term debt Commercial paper $ 2,390 $ 1,517 Credit facilities 5 4,198 1,071 £700 million note issuance 1 2.875% unsecured Pound sterling notes due 2020 — 533 $8 billion note issuance 1 3.300% unsecured notes due 2021 1,249 — Other 2 126 144 Total short-term debt $ 7,963 $ 3,265 Long-term debt $1.5 billion note issuance 1 3.200% unsecured notes due 2030 $ 497 $ 497 4.100% unsecured notes due 2050 5 792 990 $6 billion note issuance 1 3.450% unsecured notes due 2026 5 1,442 1,891 4.650% unsecured notes due 2046 5 318 591 $8 billion note issuance 1 3.300% unsecured notes due 2021 — 1,248 3.800% unsecured notes due 2024 5 1,154 1,993 4.500% unsecured notes due 2034 5 301 496 4.800% unsecured notes due 2044 5 868 1,493 £700 million note issuance 1 3.600% unsecured Pound sterling notes due 2025 423 398 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 913 891 $4 billion note issuance 3 3.100% unsecured notes due 2022 5 731 1,198 4.400% unsecured notes due 2042 5 263 493 Other 4 31 24 Total long-term debt, less current portion $ 7,732 $ 12,203 1 Notes are unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. On October 20, 2020, the Company redeemed in full the £400 million aggregate principal amount outstanding of its 2.875% unsecured Pound sterling notes due 2020 issued by the Company on November 20, 2014. 2 Other short-term debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 Notes are senior debt obligations of Walgreen Co. and rank equally with all other unsecured and unsubordinated indebtedness of Walgreen Co. On December 31, 2014, the Company fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of the Company and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company. 4 Other long-term debt represents a mix of fixed and variable rate debt in various currencies with various maturities. 5 On April 26, 2021, the Company entered into a cash tender offer to partially purchase and retire $3.3 billion of long term U.S. dollar denominated notes with a weighted average interest rate of 4.02%, using funds drawn down from the $3.8 billion April 2021 Credit Agreement (as defined below). The Company recognized a loss of $419 million related to the early extinguishment of debt, within Interest expense, which includes $386 million of redemption premium paid in cash. The cash payments related to the early extinguishment of debt are classified as cash outflows from financing activities in the consolidated statement of cash flows. On June 1, 2021, the Company completed the previously announced sale of the Company’s Alliance Healthcare business and used a portion of the Transaction proceeds to repay all of the outstanding amount owed on the April 2021 Credit Agreement that funded the bond tender completed by the Company on April 26, 2021. $1.5 Billion Note Issuance On April 15, 2020, the Company issued, in an underwritten public offering, $0.5 billion of 3.20% notes due 2030 and $1.0 billion of 4.10% notes due 2050. Total issuance costs relating to the notes, including underwriting discounts and offering expenses were $13 million. The Company partially purchased and retired $0.2 billion of its outstanding $1.0 billion, 4.10% notes due 2050 pursuant to the debt tender offer completed on April 26, 2021. Credit facilities April 9, 2021 Delayed Draw Term Loan Credit Agreement On April 9, 2021, the Company entered into a delayed draw term loan credit agreement (the “April 2021 Credit Agreement”) with the lenders from time to time party thereto. The purpose of the loan was to fund the Company's April 26, 2021 cash tender offer to partially purchase and retire $3.30 billion of long term U.S. dollar denominated notes. The April 2021 Credit Agreement was initially a $2.75 billion senior unsecured delayed draw term loan facility, with an original facility termination date (the “Initial Maturity Date”) of the earliest of (x) October 9, 2021, (y) the date of acceleration of all term loans and termination of all commitments pursuant to the April 2021 Credit Agreement and (z) the date of prepayment of all loans and the termination of all commitments pursuant to the April 2021 Credit Agreement. On April 23, 2021, the April 2021 Credit Agreement term loan facility amount was increased to $3.8 billion. As of May 31, 2021, there were $3.8 billion of borrowings outstanding under the April 2021 Credit Agreement. On June 1, 2021 the Company completed the previously announced sale of the Company’s Alliance Healthcare business and used a portion of the Transaction proceeds to repay all borrowings outstanding under the April 2021 Credit Agreement. December 23, 2020 Revolving Credit Agreement On December 23, 2020, the Company entered into a $1.25 billion senior unsecured 364-day revolving credit agreement and a $2.25 billion senior unsecured 18-month revolving credit facility, with a swing line subfacility commitment amount of $350 million, with designated borrowers from time to time party thereto and lenders from time to time party thereto. The 364-Day Facility’s termination date is the earlier of (i) 364 days from December 23, 2020, the effective date (subject to the extension thereof pursuant to the 2020 Revolving Credit Agreement) and (ii) the date of termination in whole of the aggregate amount of the revolving commitments under the 364-Day Facility pursuant to the 2020 Revolving Credit Agreement. The 18-Month Facility’s termination date is the earlier of (i) 18 months from the effective date (subject to the extension thereof pursuant to the 2020 Revolving Credit Agreement) and (ii) the date of termination in whole of the aggregate amount of the revolving commitments under the 18-Month Facility pursuant to the 2020 Revolving Credit Agreement. As of May 31, 2021, there were $400 million borrowings outstanding under the 2020 Revolving Credit Agreement. April 7, 2020 Revolving Credit Agreement On April 7, 2020, the Company and with WBA Financial Services Limited, a private limited company incorporated under the laws of England and Wales (“WBAFSL”), as co-borrowers, entered into a $500 million revolving credit agreement (the “April 7, 2020 Revolving Credit Agreement”) with the lenders from time to time party thereto. The April 7, 2020 Revolving Credit Agreement is a senior unsecured revolving credit facility, with a facility termination date of the earlier of (a) 364-days from April 7, 2020 and (b) the date of termination in whole of the aggregate amount of the commitments pursuant to the April 7, 2020 Revolving Credit Agreement . The Company and WBAFSL are co-borrowers under the April 7, 2020 Revolving Credit Agreement. Pursuant to the terms of the April 7, 2020 Revolving Credit Agreement, the Company provides a guarantee of any obligations of WBAFSL under the April 7, 2020 Revolving Credit Agreement. This revolving credit agreement was terminated in full on December 23, 2020. April 2020 Revolving Bilateral and Club Credit Agreements The Company entered into a $750 million revolving credit agreement on April 1, 2020 (the “April 2020 Revolving Bilateral Credit Agreement”) and a $1.325 billion revolving credit agreement on April 2, 2020 (the “April 2020 Revolving Club Credit Agreement” and together with the April 2020 Revolving Bilateral Credit Agreement, the “Other April 2020 Revolving Credit Agreements”) with the lenders from time to time party thereto. Each of the Other April 2020 Revolving Credit Agreements is a senior unsecured revolving credit facility, with a facility termination date of the earlier of (a) March 31, 2021 (which date shall be shortened pursuant to the terms of the applicable Other April 2020 Revolving Credit Agreement if the Company does not extend the maturity date of certain of its existing credit agreements or enter into new bank or bond financings with a certain maturity date and above an aggregate principal amount as described in the applicable Other April 2020 Revolving Credit Agreement ) and (b) the date of termination in whole of the aggregate amount of the commitments pursuant to the applicable Other April 2020 Revolving Credit Agreement. This revolving credit agreement was terminated in full on December 23, 2020. August 2019 Revolving Credit Agreements On August 30, 2019, the Company entered into three $500 million revolving credit agreements (together, the “August 2019 Revolving Credit Agreements” and each individually, an “August 2019 Revolving Credit Agreement”) with the lenders from time to time party thereto. Each of the August 2019 Revolving Credit Agreements are senior unsecured revolving credit facilities, with facility termination dates of the earlier of (a) 18 months following August 30, 2019, subject to extension thereof pursuant to the applicable August 2019 Revolving Credit Agreement, and (b) the date of termination in whole of the aggregate amount of the commitments pursuant to the applicable August 2019 Revolving Credit Agreement. This revolving credit agreement was terminated in full on December 23, 2020. January 2019 364-Day Revolving Credit Agreement On January 18, 2019, the Company entered into a $2.0 billion 364-day revolving credit agreement (as extended, the “January 2019 364-Day Revolving Credit Agreement”) with the lenders from time to time party thereto. The January 2019 364-Day Revolving Credit Agreement is a senior unsecured 364-day revolving credit facility, with an original facility termination date of 364 days following January 31, 2019, subject to extension. On December 18, 2019, the Company entered into an Extension Agreement (the “Extension Agreement”) relating to the January 2019 364-Day Revolving Credit Agreement with the lenders party thereto and Mizuho, as administrative agent. The Extension Agreement extended the Maturity Date (as defined in the January 2019 364-Day Revolving Credit Agreement) for an additional period of 364 days to January 28, 2021. Such extension became effective on January 30, 2020. The January 2019 364 Day Revolving Credit Agreement was partially terminated on December 23, 2020. The January 2019 364-Day Revolving Credit Agreement was partially terminated in accordance with its terms and conditions, reducing the amount available to $0.5 billion as of December 23, 2020. The outstanding facility amount of $1.5 billion was terminated on January 28, 2021. A&R December 2018 Credit Agreement On December 5, 2018, the Company entered into a $1.0 billion term loan credit agreement with the lenders from time to time party thereto and, on August 9, 2019, the Company entered into an amendment to such credit agreement (such credit agreement as so amended, the “December 2018 Credit Agreement”) to permit the Company to borrow, repay and reborrow amounts borrowed thereunder prior to the maturity date. On April 2, 2020, the Company amended and restated the December 2018 Credit Agreement (such credit agreement as so amended and restated, the “A&R December 2018 Credit Agreement”). The A &R December 2018 Credit Agreement governs a $2.0 billion senior unsecured revolving credit facility, consisting of the initial $1.0 billion senior unsecured revolving facility previously governed by the December 2018 Credit Agreement and a new $1.0 billion senior unsecured revolving credit facility. The facility termination date is the earlier of (a) January 29, 2021 (which date shall be extended to February 26, 2021 or July 31, 2021 pursuant to the terms of the A &R December 2018 Credit Agreement if the Company extends the maturity date of certain of its existing credit agreements or enters into new bank or bond financings with a certain maturity date and above an aggregate principal amount as described in the A &R December 2018 Credit Agreement ) and (b) the date of termination in whole of the aggregate amount of the commitments pursuant to the A &R December 2018 Credit Agreement. The A&R December 2018 Credit Agreement was further amended on December 23, 2020 whereby the new facility was terminated in full and the existing facility matured in January 2021. Amended November 2018 Credit Agreement On November 30, 2018, the Company entered into a $1.0 billion credit agreement, consisting of a $500 million senior unsecured revolving credit facility and a $500 million senior unsecured term loan facility, with the lenders from time to time party thereto, on March 25, 2019, the Company entered into an amendment to such credit agreement (such credit agreement as so amended, the “November 2018 Credit Agreement”) reflecting certain changes to the borrowing notice provisions thereto. On April 2, 2020, the Company entered into a second amendment to the November 2018 Credit Agreement (such credit agreement as so further amended, the “Amended November 2018 Credit Agreement”) which amendment became effective as of May 29, 2020. As of May 29, 2020, the $500 million revolving credit facility portion of the November 2018 Credit Agreement was converted into a term loan facility, such that the Amended November 2018 Credit Agreement consists of a $1.0 billion senior unsecured term loan facility. The facility termination date is the earlier of (a) May 29, 2021 and (b) the date of acceleration of all loans under the Amended November 2018 Credit Agreement pursuant to its terms. The November 2018 Credit Agreement was repaid in full on April 23, 2021. August 2018 Revolving Credit Agreement On August 29, 2018, the Company entered into a revolving credit agreement (the “August 2018 Revolving Credit Agreement”) with the lenders and letter of credit issuers from time to time party thereto. The August 2018 Revolving Credit Agreement is an unsecured revolving credit facility with aggregate commitment in the amount of $3.5 billion, with a letter of credit subfacility commitment amount of $500 million. The facility termination date is the earlier of (a) August 29, 2023, subject to extension thereof pursuant to the August 2018 Revolving Credit Agreement, and (b) the date of termination in whole of the aggregate amount of the revolving commitments pursuant to the August 2018 Revolving Credit Agreement. As of May 31, 2021, there were no borrowings outstanding under the August 2018 Revolving Credit Agreement. Debt covenants Each of the Company’s credit facilities described above contain a covenant to maintain, as of the last day of each fiscal quarter, a ratio of consolidated debt to total capitalization not to exceed 0.60:1.00, subject to increase in certain circumstances set forth in the applicable credit agreement. The credit facilities also contain various other customary covenants. Commercial paper The Company periodically borrows under its commercial paper program and may borrow under it in future periods. The Company had average daily U.S. commercial paper outstanding of $2.3 billion and $2.6 billion at a weighted average interest rate of 0.47% and 2.33% for the nine months ended May 31, 2021 and May 31, 2020, respectively. A subsidiary of the Company had average daily commercial paper outstanding, which was issued under the Joint HM Treasury and Bank of England's COVID Corporate Financing Facility commercial paper program, of £300 million or approximately $424 million at a weighted average interest rate of 0.43% for the nine months ended May 31, 2021. The subsidiary of the Company repaid the commercial paper issued under the Joint HM Treasury and Bank of England's COVID Corporate Financing Facility commercial paper program on May 14, 2021. Interest Interest paid by the Company was $889 million and $510 million for the nine months ended May 31, 2021 and May 31, 2020, respectively. Interest paid in the nine months ended May 31, 2021 of $889 million includes charges on early extinguishment of debt of $387 million. |
Financial instruments
Financial instruments | 9 Months Ended |
May 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial instruments | Financial instrumentsThe Company uses derivative instruments to manage its exposure to interest rate and foreign currency exchange risks. The Company has non-U.S. dollar denominated net investments and uses foreign currency denominated financial instruments, specifically foreign currency derivatives and foreign currency denominated debt, to hedge its foreign currency risk. The notional amounts and fair value of derivative instruments outstanding were as follows (in millions): May 31, 2021 Notional Fair value Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Interest rate swaps $ 1,000 $ 5 Other non-current assets Cross currency interest rate swaps 992 58 Other non-current liabilities Foreign currency forwards 39 2 Other non-current liabilities Foreign currency forwards 1 — Other current assets Foreign currency forwards 635 14 Other current liabilities Cross currency interest rate swaps 113 13 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,368 $ 3 Other current assets Total return swap 244 9 Other current assets Foreign currency forwards 2,613 30 Other current liabilities August 31, 2020 Notional Fair value Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Cross currency interest rate swaps $ 722 $ 16 Other non-current assets Foreign currency forwards 49 1 Other non-current liabilities Cross currency interest rate swaps 318 13 Other non-current liabilities Interest rate swaps 1,000 10 Other non-current liabilities Foreign currency forwards 100 1 Other current assets Cross currency interest rate swaps 50 — Other current assets Foreign currency forwards 671 23 Other current liabilities Cross currency interest rate swaps 103 3 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,930 $ 19 Other current assets Foreign currency forwards 2,934 56 Other current liabilities Total return swap 205 1 Other current liabilities Net investment hedges The Company uses cross currency interest rate swaps and foreign currency forward contracts to hedge net investments in subsidiaries with non-U.S. dollar functional currencies. For qualifying net investment hedges, changes in the fair value of the derivatives are recorded in the currency translation adjustment within accumulated other comprehensive income (loss). Cash flow hedges The Company uses interest rate swaps to hedge the variability in forecasted cash flows of certain floating-rate debt. For qualifying cash flow hedges, changes in the fair value of the derivatives are recorded in accumulated other comprehensive income (loss) and released to the Consolidated Statements of Earnings when the hedged cash flows affect earnings. Derivatives not designated as hedges The Company enters into derivative transactions that are not designated as accounting hedges. These derivative instruments are economic hedges of foreign currency risks. The Company also utilizes total return swaps to economically hedge variability in compensation charges related to certain deferred compensation obligations. The income (expenses) due to changes in fair value of these derivative instruments were recognized in earnings as follows (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2021 2020 2021 2020 Foreign currency forwards Selling, general and administrative expenses $ (53) $ 72 $ (177) $ 11 Total return swaps Selling, general and administrative expenses 20 5 48 5 Foreign currency forwards Other income (expense) (5) 2 (6) 6 Derivatives credit risk Counterparties to derivative financial instruments expose the Company to credit-related losses in the event of counterparty nonperformance, and the Company regularly monitors the credit worthiness of each counterparty. Derivatives offsetting The Company does not offset the fair value amounts of derivative instruments subject to master netting agreements in the Consolidated Condensed Balance Sheets. |
Fair value measurements
Fair value measurements | 9 Months Ended |
May 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements The Company measures certain assets and liabilities in accordance with Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures, which defines fair value as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. In addition, it establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels: Level 1 - Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2 - Observable inputs other than quoted prices in active markets. Level 3 - Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to Level 3 inputs. Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): May 31, 2021 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 447 $ 447 $ — $ — Investments in equity securities 2 10 10 — — Investments in debt securities 3 535 — — 535 Foreign currency forwards 4 3 — 3 — Interest rate swaps 5 5 — 5 — Total return swaps 9 — 9 — Warrants 2 — 2 — Liabilities : Foreign currency forwards 4 $ 46 $ — $ 46 $ — Cross currency interest rate swaps 5 71 — 71 — August 31, 2020 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 6 $ 6 $ — $ — Investments in equity securities 2 1 1 — — Foreign currency forwards 4 20 — 20 — Cross currency interest rate swaps 5 16 — 16 — Liabilities : Foreign currency forwards 4 $ 80 $ — $ 80 $ — Cross currency interest rate swaps 5 16 — 16 — Interest rate swaps 5 10 — 10 — Total return swaps 1 — 1 — 1 Money market funds are valued at the closing price reported by the fund sponsor. 2 Fair values of quoted investments are based on current bid prices as of May 31, 2021 and August 31, 2020. 3 Level 3 debt securities include investments in convertible debt securities of VillageMD which are valued on a quarterly basis using an option pricing method, a form of the income approach, with gains or losses recorded in Other Comprehensive Income. Inputs include the enterprise value, expected holding term of the investment, volatility and risk-free interest rates. 4 The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates. See Note 9 Financial instruments, for additional information. 5 The fair value of cross currency interest rate swaps and interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See Note 9 Financial instruments, for additional information. There were no transfers between Levels for the three and nine months ended May 31, 2021. As of May 31, 2021, the carrying amounts and estimated fair values of long-term notes outstanding including the current portion were $8.9 billion and $9.7 billion, respectively. The fair values of the notes outstanding are Level 1 fair value measures and determined based on quoted market price and translated at the May 31, 2021 spot rate, as applicable. The fair values and carrying values of these issuances do not include notes that have been redeemed or repaid as of May 31, 2021. See Note 8 Debt, for further information. The carrying values of the Company's commercial paper, credit facilities, accounts receivable and trade accounts payable approximated their respective fair values due to their short-term nature. |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
May 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies The Company is involved in legal proceedings, including litigation, arbitration and other claims, and investigations, inspections, subpoenas, audits, claims, inquiries and similar actions by pharmacy, healthcare, tax and other governmental authorities, arising in the normal course of the Company’s business, including the matters described below. Legal proceedings, in general, and securities, class action and multi-district litigation, in particular, can be expensive and disruptive. Some of these suits may purport or may be determined to be class actions and/or involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years. From time to time, the Company is also involved in legal proceedings as a plaintiff involving antitrust, tax, contract, intellectual property and other matters. Gain contingencies, if any, are recognized when they are realized. Like other companies in the retail pharmacy and pharmaceutical wholesale industries, the Company is subject to extensive regulation by national, state and local government agencies in the U.S. and other countries in which it operates. There continues to be a heightened level of review and/or audit by regulatory authorities of, and increased litigation regarding, the Company’s and the rest of the health care and related industry’s business, compliance and reporting practices. As a result, the Company regularly is the subject of government actions of the types described above. The Company also may be named from time to time in qui tam actions initiated by private third parties. In such actions, the private parties purport to act on behalf of federal or state governments, allege that false claims have been submitted for payment by the government and may receive an award if their claims are successful. After a private party has filed a qui tam action, the government must investigate the private party's claim and determine whether to intervene in and take control over the litigation. These actions may remain under seal while the government makes this determination. If the government declines to intervene, the private party may nonetheless continue to pursue the litigation on his or her own purporting to act on behalf of the government. The results of legal proceedings, including government investigations, are often uncertain and difficult to predict, and the costs incurred in these matters can be substantial, regardless of the outcome. With respect to litigation and other legal proceedings where the Company has determined that a material loss is reasonably possible, the Company is unable to estimate the amount or range of reasonably possible loss due to the inherent difficulty of predicting the outcome of and uncertainties regarding such litigation and legal proceedings. The Company believes that its defenses and assertions in pending legal proceedings have merit and does not believe that any of these pending matters, after consideration of applicable reserves and rights to indemnification, will have a material adverse effect on the Company’s consolidated financial position. However, substantial unanticipated verdicts, fines and rulings do sometimes occur. As a result, the Company could from time to time incur judgments, enter into settlements or revise its expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on its results of operations in the period in which the amounts are accrued and/or its cash flows in the period in which the amounts are paid. In addition, as a result of governmental investigations or proceedings, the Company may be subject to damages, civil or criminal fines or penalties, or other sanctions, including the possible suspension or loss of licensure and/or suspension or exclusion from participation in government programs. On December 29, 2014, a putative shareholder filed a derivative action in federal court in the Northern District of Illinois against certain current and former directors and officers of Walgreen Co. and Walgreen Co., as a nominal defendant, arising out of certain public statements the Company made regarding its former fiscal 2016 goals. ( Cutler v. Wasson et al. , No. 1:14-cv-10408 (N.D. Ill.)) The action asserts claims for breach of fiduciary duty, waste and unjust enrichment. On May 18, 2015, the case was stayed in light of a securities class action that was filed on April 10, 2015, described below. On November 3, 2016, the Court entered a stipulation and order extending the stay until the resolution of the securities class action. On April 10, 2015, a putative shareholder filed a securities class action in federal court in the Northern District of Illinois against Walgreen Co. and certain former officers of Walgreen Co. ( Washtenaw County Employees’ Retirement System v. Walgreen Co. et al. , No. 1:15-cv-3187 (N.D. Ill.)) The action asserts claims for violation of the federal securities laws arising out of certain public statements the Company made regarding its former fiscal 2016 goals. A motion to dismiss a consolidated class action complaint filed on August 17, 2015 was granted in part and denied in part on September 30, 2016. The court granted plaintiff’s motion for class certification on March 29, 2018 and plaintiff filed a first amended complaint on December 19, 2018. A motion to dismiss the first amended complaint was granted in part and denied in part on September 23, 2019. Fact discovery and expert discovery have concluded. Motions for summary judgment have been fully briefed. On December 11, 2017, purported Rite Aid shareholders filed an amended complaint in a putative class action lawsuit in the U.S. District Court for the Middle District of Pennsylvania (the “M.D. Pa. action”) arising out of transactions contemplated by the merger agreement between the Company and Rite Aid. The amended complaint alleged that the Company and certain of its officers made false or misleading statements regarding the transactions. The Court denied the Company’s motion to dismiss the amended complaint on April 15, 2019. The Company filed an answer and affirmative defenses, discovery commenced, and the Court granted plaintiffs' motion for class certification. In October and December 2020, two separate purported Rite Aid Shareholders filed lawsuits in the same court as the M.D. Pa. action opting out of the class in the M.D. Pa. action making nearly identical allegations as those in the M.D. Pa. action (the “Direct Actions”). On December 24, 2020, the parties to the Direct Actions filed a joint stipulation to stay the Direct Actions until the earlier of (a) 30 days after the entry of an order resolving any pre-trial dispositive motions in the M.D. Pa. action, or (b) 30 days after the entry of an order of final approval of any settlement of the M.D. Pa. action. The court so ordered the joint stipulation on December 28, 2020. In June 2019, a Fred’s, Inc. shareholder filed a nearly identical lawsuit to the M.D. Pa. action in the U.S. District Court for the Western District of Tennessee, except naming Fred’s, Inc. and one of its former officers along with the Company and certain of its officers. Lead plaintiffs filed an amended complaint on November 4, 2019, which is substantially the same as the original complaint. The court granted the Company's motion to dismiss to the amended complaint on March 31, 2021. In December 2017, the U.S. Judicial Panel on Multidistrict Litigation consolidated numerous cases filed against an array of defendants by various plaintiffs such as counties, cities, hospitals, Indian tribes, and others, alleging claims generally concerning the impacts of widespread opioid abuse. The consolidated multidistrict litigation, captioned In re National Prescription Opiate Litigation (MDL No. 2804, Case No. 17-md-2804), is pending in the U.S. District Court for the Northern District of Ohio ("N.D. Ohio"). The Company is involved in the following multidistrict litigation (MDL) bellwether cases: (1) two consolidated cases in N.D. Ohio ( Cnty. of Summit, Ohio, et al v. Purdue Pharma L.P., et al. , Case No. 18-op-45090; Cnty. of Cuyahoga, Ohio, et al. v. Purdue Pharma L.P. , Case No. 18-op-45004), previously scheduled for trial in November 2020 but postponed indefinitely; (2) one remanded to the U. S. District Court for the Eastern District of Oklahoma ( The Cherokee Nation v. McKesson Corp., et al. , Case No. 18-CV-00056-RAW-SPS), scheduled for trial in September 2022; (3) one remanded to the U.S. District Court for the Northern District of California ( City and Cnty. of San Francisco, et al. v. Purdue Pharma L.P., et al. , Case No. 3:18-cv-07591-CRB), originally scheduled for trial in October 2021, but rescheduled for April 2022; and (4) two additional consolidated cases in N.D. Ohio ( Cnty. of Lake, Ohio v. Purdue Pharma L.P., et al. , Case No. 18-op-45032; Cnty. of Trumbull, Ohio v. Purdue Pharma L.P., et al. , Case No. 18-op-45079), initially scheduled for trial in May 2021 but continued until October 2021. In April 2021, the MDL court selected five additional bellwether cases involving the Company, all currently pending in N.D. Ohio: (1) Cobb Cnty. v. Purdue Pharma L.P., et al. , Case No. 18-op-45817; (2) Durham Cnty. v. AmerisourceBergen Drug Corp., et al. , Case No. 19-op-45346; (3) Montgomery Cnty. Bd. of Cnty. Commrs., et al. v. Cardinal Health, Inc., et al. , Case No. 18-op-46326; (4) Board of Cnty. Commrs. of the Cnty. of Santa Fe v. Purdue Pharma L.P., et al. , Case No. 18-op-45776; and (5) Cnty. of Tarrant v. Purdue Pharma L.P., et al. , Case No. 18-op-45274. The Company also has been named as a defendant in numerous lawsuits brought in state courts relating to opioid matters. Trial dates have been set in cases pending in state courts in New Mexico ( State of New Mexico, ex rel. Hector Balderas, Attorney General v. Purdue Ph arma L.P., et al., Case No. D-101-cv-2017-02541, First Judicial District Court, Santa Fe County, New Mexico - September 2022); West Virginia ( In re: Opioid Litigation , Circuit Court of Kanawha County, West Virginia, Civil Action No. 19-C-9000 - November 2021); Missouri ( Jefferson County, Missouri v. Dannie E. Williams, M.D., et al. , Cause No. 20JE-CC00029, Twenty-Third Judicial Circuit, Jefferson County, Missouri - June 2022); Florida ( State of Florida, Office of the Attorney General, Department of Legal Affairs v. Purdue Pharma L.P., et al. , Case No. 2018-CA-001438, Sixth Judicial Circuit in and for Pasco County, Florida - April 2022); Nevada ( State of Nevada v. McKesson Corporation, et al. , Case No. A-19-796755-B, Eighth Judicial District Court, Clark County, Nevada - January 2023); Michigan ( State of Michigan, ex rel. Dana Nessel, Attorney General v. Cardinal Health, Inc. , Case No. 19-016896-NZ, Circuit Court for Wayne County, Michigan - October 2022); and Alabama ( The DCH Health Care Authority, et al. v. Purdue Pharma LP, et al. , Cause No. CV-2019-000007.00, Circuit Court of Conecuh County, Alabama - July 2022). In two consolidated cases in New York state court ( County of Suffolk v. Purdue Pharma L.P., et al. , Index No. 400001/2017; County of Nassau v. Purdue Pharma L.P., et al., Index No. 400008/2017, Supreme Court of the State of New York, Suffolk County, New York) jury selection began in June 2021. The relief sought by various plaintiffs in these matters is compensatory and punitive damages, as well as injunctive relief. Additionally, the Company has received from the Department of Justice and the Attorney Generals of numerous states subpoenas, civil investigative demands, and/or other requests concerning opioid matters. The Company has also had communications with the Department of Justice with respect to purported violations of the federal Controlled Substances Act and the federal False Claims Act in dispensing prescriptions at certain Walgreens locations. As discussed above, legal proceedings, including government investigations, are often uncertain and difficult to predict, and the costs and penalties incurred in these matters can be substantial. |
Income taxes
Income taxes | 9 Months Ended |
May 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The effective tax rate for the three months ended May 31, 2021 was 32.8%, compared to 2.3% for the three months ended May 31, 2020. The tax rate for the current period includes a discrete tax expense on equity earnings of $576 million from HC Group Holdings. See Note 6 Equity method investments for further information. The effective tax rate for the prior period reflects a tax benefit on a pretax loss and is primarily driven by the impact of a non-deductible goodwill impairment charge. The effective tax rate for the nine months ended May 31, 2021 was an expense of 7.4%, primarily due to the discrete tax effect of equity losses in AmerisourceBergen, partially offset by the tax effect of equity earnings of HC Group Holdings. The effective tax rate for the nine months ended May 31, 2020 was an expense of 230.0%, on a pretax loss for the nine months ended May 31, 2020 primarily due to a non-deductible goodwill impairment charge. Income taxes paid for the nine months ended May 31, 2021 were $305 million, compared to $604 million for the nine months ended May 31, 2020. During the next twelve months, based on current knowledge, it is reasonably possible the amount of unrecognized tax benefits could decrease by up to $110 million due to anticipated U.S. federal income tax audit settlements. During the nine months ended May 31, 2021, the Company recognized an increase in uncertain tax benefits, resulting in a reduction in deferred tax assets for capital loss carryforwards and corresponding valuation allowance. |
Retirement benefits
Retirement benefits | 9 Months Ended |
May 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement benefits | Retirement benefits The Company sponsors several retirement plans, including defined benefit plans, defined contribution plans and a postretirement health plan. Defined benefit pension plans (non-U.S. plans) The Company has various defined benefit pension plans outside the U.S. The principal defined benefit pension plan is the Boots Pension Plan (the “Boots Plan”), which covers certain employees in the UK. The Boots Plan is a funded final salary defined benefit plan providing pensions and death benefits to members. The Boots Plan was closed to future accrual effective July 1, 2010, with pensions calculated based on salaries up until that date. The Boots Plan is governed by a trustee board, which is independent of the Company. The plan is subject to a full funding actuarial valuation on a triennial basis. Components of net periodic pension costs (income) for the defined benefit pension plans (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2021 2020 2021 2020 Service costs Selling, general and administrative expenses $ 2 $ — $ 4 $ 1 Interest costs Other income 36 34 104 106 Expected returns on plan assets/other Other income (85) (69) (248) (214) Total net periodic pension costs (income) $ (48) $ (35) $ (140) $ (106) The Company made cash contributions to its defined benefit pension plans of $37 million for the nine months ended May 31, 2021, which primarily related to committed payments. The Company plans to contribute an additional $2 million to its defined benefit pension plans in fiscal 2021. Defined contribution plans The principal retirement plan for U.S. employees is the Walgreen Profit-Sharing Retirement Trust, to which both the Company and participating employees contribute. The Company’s contribution is in the form of a guaranteed match which is made pursuant to the applicable plan document approved by the Walgreen Co. Board of Directors. Plan activity is reviewed periodically by certain Committees of the Walgreens Boots Alliance Board of Directors. The profit-sharing provision was an expense of $54 million and $166 million for the three and nine months ended May 31, 2021, respectively, compared to an expense of $57 million and $171 million for the three and nine months ended May 31, 2020, respectively. The Company also has certain contract based defined contribution arrangements. The principal one is UK based to which both the Company and participating employees contribute. The cost recognized for the three and nine months ended May 31, 2021 was $25 million and $77 million, respectively, compared to a cost of $26 million and $80 million in the three and nine months ended May 31, 2020, respectively. |
Accumulated other comprehensive
Accumulated other comprehensive income (loss) | 9 Months Ended |
May 31, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) The following is a summary of net changes in accumulated other comprehensive income (“AOCI”) by component and net of tax for the three and nine months ended May 31, 2021 and May 31, 2020 (in millions): Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Unrealized gain (loss) on available for sale securities Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 28, 2021 $ (739) $ (18) $ (90) $ — $ 10 $ (2,469) $ (3,306) Other comprehensive income (loss) before reclassification adjustments — (3) (30) 5 2 141 115 Amounts reclassified from AOCI (2) 14 — — — 1 13 Tax benefit (provision) — (3) 7 — (6) — (1) Net change in other comprehensive income (loss) (1) 8 (23) 5 (4) 142 127 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Unrealized gain (loss) on available for sale securities Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2020 $ (748) $ (31) $ (34) $ — $ (10) $ (2,948) $ (3,771) Other comprehensive income (loss) before reclassification adjustments 16 11 (110) 5 21 615 558 Amounts reclassified from AOCI (6) 16 — — — 6 17 Tax benefit (provision) (3) (7) 31 — (5) — 17 Net change in other comprehensive income (loss) 8 21 (79) 5 16 621 591 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Share of AOCI of equity method investments Cumulative translation adjustments Total Balance at February 29, 2020 $ (57) $ (24) $ 34 $ (1) $ (3,360) $ (3,407) Other comprehensive income (loss) before reclassification adjustments (4) (8) 59 (18) (482) (453) Amounts reclassified from AOCI (3) 1 — — — (1) Tax benefit (provision) 4 2 (13) 3 (5) (9) Net change in other comprehensive income (loss) (2) (5) 46 (15) (487) (463) Balance at May 31, 2020 $ (59) $ (29) $ 80 $ (16) $ (3,847) $ (3,871) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges 1 Net investment hedges Share of AOCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2019 $ (48) $ (24) $ 55 $ 3 $ (3,884) $ (3,897) Other comprehensive income (loss) before reclassification adjustments (12) (9) 31 (23) 39 26 Amounts reclassified from AOCI (3) 4 — — — 1 Tax benefit (provision) 4 1 (6) 3 (2) — Net change in other comprehensive income (loss) (11) (4) 25 (20) 37 27 Balance at May 31, 2020 $ (59) $ (29) $ 80 $ (16) $ (3,847) $ (3,871) |
Segment reporting
Segment reporting | 9 Months Ended |
May 31, 2021 | |
Segment Reporting [Abstract] | |
Segment reporting | Segment reporting On January 6, 2021, the Company entered into a Share Purchase Agreement with AmerisourceBergen. Pursuant to the terms and subject to the conditions set forth in the Share Purchase Agreement, AmerisourceBergen agreed to purchase the majority of the Company's Alliance Healthcare business as well as a portion of the Company’s retail pharmacy international businesses in Europe. The majority of the Disposal Group was previously included in the Pharmaceutical Wholesale segment. Effective as of the second quarter of fiscal year 2021, the Company eliminated the Pharmaceutical Wholesale segment and is aligned into two reportable segments: United States and International. The operating segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker) to assess segment performance and allocate resources among the Company’s operating segments. The chief operating decision maker uses adjusted operating income to assess segment profitability. The chief operating decision maker does not use total assets by segment to make decisions regarding resources; therefore, the total asset disclosure by segment has not been included. United States The Company's United States segment includes the Walgreens business which includes the operations of retail drugstores, health and wellness services, and mail and central specialty pharmacy services, and its equity method investment in AmerisourceBergen. Sales for the segment are principally derived from the sale of prescription drugs and a wide assortment of retail products, including health and wellness, beauty, personal care and consumables and general merchandise. International The Company's International segment consists of pharmacy-led health and beauty retail businesses outside the U.S. and pharmaceutical wholesaling and distribution business in Germany. Pharmacy-led health and beauty retail businesses include Boots branded stores in the UK, the Republic of Ireland and Thailand, the Benavides brand in Mexico and the Ahumada brand in Chile. Sales for these businesses are principally derived from the sale of prescription drugs and health and wellness, beauty, personal care and other consumer products. The results of operations for reportable segments include procurement benefits. Corporate-related overhead costs are not allocated to reportable segments and are reported in the “Corporate and Other”. The following table reflects results of operations of the Company's reportable segments (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales: United States $ 28,743 $ 27,357 $ 83,250 $ 80,734 International 5,288 3,008 14,998 10,878 Walgreens Boots Alliance, Inc. $ 34,030 $ 30,364 $ 98,247 $ 91,612 Adjusted Operating income: United States $ 1,471 $ 979 $ 3,789 $ 3,704 International 94 (135) 326 155 Corporate and Other (105) (46) (233) (135) Walgreens Boots Alliance, Inc. $ 1,459 $ 798 $ 3,881 $ 3,724 The following table reconciles adjusted operating income to operating income (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Adjusted operating income $ 1,459 $ 798 $ 3,881 $ 3,724 Adjustments to equity earnings (loss) in AmerisourceBergen (48) 105 (1,575) (47) Transformational cost management (60) (310) (338) (508) Acquisition-related amortization (158) (94) (367) (290) Certain legal and regulatory accruals and settlements — — (60) — LIFO provision (51) (29) (85) (90) Acquisition-related costs (9) (68) (25) (291) Impairment of goodwill and intangible assets — (2,001) — (2,001) Store optimization — (10) — (49) Store damage and inventory losses — (75) — (75) Operating income (loss) $ 1,134 $ (1,683) $ 1,432 $ 374 |
Sales
Sales | 9 Months Ended |
May 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Sales | Sales The following table summarizes the Company’s sales by segment and by major source (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 United States Pharmacy $ 21,770 $ 20,478 $ 63,133 $ 60,084 Retail 6,973 6,879 20,117 20,650 Total 28,743 27,357 83,250 80,734 International Pharmacy 958 794 2,791 2,531 Retail 1,455 971 4,618 4,735 Wholesale 2,875 1,243 7,588 3,611 Total 5,288 3,008 14,998 10,878 Walgreens Boots Alliance, Inc. $ 34,030 $ 30,364 $ 98,247 $ 91,612 Contract balances with customers Contract liabilities primarily represent the Company’s obligation to transfer additional goods or services to a customer for which the Company has received consideration, for example the Company’s myWalgreens and Boots Advantage Card loyalty programs. Under such programs, customers earn reward points on purchases for redemption at a later date. See Note 19 Supplemental information, for further information on receivables from contracts with customers. |
Related parties
Related parties | 9 Months Ended |
May 31, 2021 | |
Related Party Transactions [Abstract] | |
Related parties | Related parties The Company has a long-term pharmaceutical distribution agreement with AmerisourceBergen pursuant to which the Company sources branded and generic pharmaceutical products from AmerisourceBergen principally for its U.S. operations. Additionally, AmerisourceBergen receives sourcing services for generic pharmaceutical products. Related party transactions with AmerisourceBergen (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Purchases, net $ 15,947 $ 15,081 $ 46,449 $ 44,489 May 31, 2021 August 31, 2020 Trade accounts payable, net $ 6,608 $ 6,390 See Note 2 Discontinued operations for further information. |
New accounting pronouncements
New accounting pronouncements | 9 Months Ended |
May 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New accounting pronouncements | Accounting policies Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2020. The coronavirus COVID-19 pandemic (“COVID-19”) has severely impacted the economies of the United States (“U.S.”), the United Kingdom (“UK”) and other countries around the world. The impact of COVID-19 on the Company’s businesses, financial position, results of operations and cash flows for the three months ended May 31, 2021, as well as information regarding certain expected or potential impacts of COVID-19 on the Company, is discussed throughout this Quarterly Report on Form 10-Q. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances including estimates of the impact of COVID-19. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors discussed throughout this Quarterly Report on Form 10-Q including, but not limited to, the severity and duration of COVID-19, the extent to which it will impact our customers, team members, suppliers, vendors, business partners and distribution channels. The Company assessed certain accounting matters that require consideration of estimates and assumptions in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of May 31, 2021 and through the date of this report. The accounting matters assessed included, but were not limited to, the Company’s carrying value of goodwill, intangible and other long-lived assets including operating lease right-of-use assets. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. The impact of COVID-19, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payer and customer relationships and terms, strategic transactions including acquisitions, dispositions, changes in laws and general economic conditions in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. On January 6, 2021, the Company entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with AmerisourceBergen Corporation (the “Transaction”). Pursuant to the terms and subject to the conditions set forth in the Share Purchase Agreement, AmerisourceBergen Corporation (“AmerisourceBergen”) agreed to purchase the majority of the Company's Alliance Healthcare business as well as a portion of the Company’s retail pharmacy international businesses in Europe (“Disposal Group”). The Disposal Group met the criteria to be reported as held for sale and discontinued operations. Therefore, effective as of the second quarter of fiscal 2021, the related assets, liabilities and operating results of the Disposal Group have been reported as discontinued operations for all periods. The majority of the Disposal Group was previously included in the Pharmaceutical Wholesale segment. Effective as of the second quarter of fiscal year 2021, the Company eliminated the Pharmaceutical Wholesale segment and aligned into two reportable segments: United States and International. See Note 15 Segment reporting for additional information on the segments. On June 1, 2021 the Company completed the Transaction. See Note 20 Subsequent events. Unless otherwise specified, disclosures in these Consolidated Condensed Financial Statements reflect continuing operations only. Certain prior period data, primarily related to discontinued operations, have been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. See Note 2 Discontinued operations for further information. Certain amounts in the Consolidated Condensed Financial Statements and associated notes may not add due to rounding. Percentages have been calculated using unrounded amounts for all periods presented. Adoption of new accounting pronouncements Financial instruments In March 2020, FASB issued ASU 2020-03. This ASU improves and clarifies various financial instruments topics. The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Investments - equity securities In April 2019, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-04, Codification Improvements to Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825). This extensive ASU provides clarifications for three topics related to financial instruments accounting, some of which apply to the Company. For example, this ASU clarifies the disclosure requirements that apply to equity securities without a readily determinable fair value for which the measurement alternative is elected. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Collaborative arrangements In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808). This ASU clarifies the interaction between Topic 808, Collaborative Arrangements, and Topic 606, Revenue from Contracts with Customers. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Compensation – retirement benefits – defined benefit plans In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement benefits (Topic 715-20). This ASU amends ASC 715 to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. The ASU eliminates the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as part of net periodic benefit cost over the next year. The ASU also removes the disclosure requirements for the effects of a one-percentage-point change on the assumed health care costs and the effect of this change in rates on service cost, interest cost and the benefit obligation for postretirement health care benefits. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Fair value measurement In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820). The ASU eliminates such disclosures as the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy. The ASU adds new disclosure requirements for Level 3 measurements. The Company adopted the new standard effective September 1, 2020 on a retrospective basis and the adoption of this ASU did not have any impact on the Company’s results of operations, cash flows or financial position. Financial instruments - credit losses In June 2016, the FASB issued ASU 2016-13: Measurement of Credit Losses on Financial Instruments (Topic 326), which amends the Board’s guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model that is based on expected losses rather than incurred losses, which is known as the current expected credit loss (“CECL”) model. The CECL model applies to most debt instruments (other than those measured at fair value), trade and other receivables, financial guarantee contracts, and loan commitments. The Company adopted the new standard effective September 1, 2020, using a modified retrospective transition method, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The adoption did not have a material impact on the Company’s financial position or results of operations. New accounting pronouncements not yet adopted Receivables - nonrefundable fees and others In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other. This ASU clarifies the accounting for the amortization period for certain purchased callable debt securities held at a premium by giving consideration to securities which have multiple call dates. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Effects of reference rate reform on financial reporting In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to above ASU to clarify certain optional expedients in Topic 848. The ASUs can be adopted no later than December 1, 2022 with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Investments — equity securities; Investments — equity method and joint ventures; Derivatives and hedging In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). The amendments in this ASU clarify the interaction between the accounting for investments in equity securities, investment in equity method and certain derivatives instruments. The ASU is expected to reduce diversity in practice and increase comparability of the accounting for these interactions. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Income taxes - simplifying the accounting for income taxes In December 2019, the FASB issued ASU 2019-12: Simplifying the Accounting for Income Taxes (Topic 740), which removes certain exceptions to the general principles in Topic 740 and improves consistent application of and simplifies GAAP for other areas of Topic 740 by clarifying and amending existing guidance. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022), and interim periods within those fiscal years, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's disclosures. |
Supplemental information
Supplemental information | 9 Months Ended |
May 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental information | Supplemental information Accounts receivable Accounts receivable are stated net of allowances for doubtful accounts. Accounts receivable balances primarily consist of trade receivables due from customers, including amounts due from third party providers (e.g., pharmacy benefit managers, insurance companies and governmental agencies). Trade receivables were $3.9 billion and $3.0 billion at May 31, 2021 and August 31, 2020, respectively. Other accounts receivable balances, which consist primarily of receivables from vendors and manufacturers, including receivables from AmerisourceBergen (see Note 17 Related parties), were $1.3 billion and $1.1 billion at May 31, 2021 and August 31, 2020, respectively. Depreciation and amortization The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Depreciation expense $ 352 $ 349 $ 1,042 $ 1,051 Intangible asset and other amortization 156 93 363 290 Total depreciation and amortization expense $ 507 $ 443 $ 1,404 $ 1,341 Accumulated depreciation and amortization on property, plant and equipment was $13.0 billion at May 31, 2021 and $12.1 billion at August 31, 2020. Restricted cash The Company is required to maintain cash deposits with certain banks which consist of deposits restricted under contractual agency agreements and cash restricted by law and other obligations. The following represents a reconciliation of cash and cash equivalents in the Consolidated Condensed Balance Sheets to total cash, cash equivalents and restricted cash in the Consolidated Condensed Statements of Cash Flows as of May 31, 2021 and August 31, 2020 (in millions): May 31, 2021 August 31, 2020 Cash and cash equivalents - continuing operations $ 1,345 $ 469 Cash and cash equivalents - discontinued operations 239 47 Restricted cash - continuing operations (included in other current assets) 76 62 Restricted cash - discontinued operations 143 168 Cash, cash equivalents and restricted cash $ 1,803 $ 746 Redeemable noncontrolling interest The redeemable noncontrolling interest balance as of May 31, 2021 was $310 million due to acquisitions during the nine months period ended May 31, 2021. See Note 3 Acquisitions for further details. Earnings per share The dilutive effect of outstanding stock options on earnings per share is calculated using the treasury stock method. Stock options are anti-dilutive and excluded from the earnings per share calculation if the exercise price exceeds the average market price of the common shares. There were 15.9 million weighted outstanding options to purchase common shares that were anti-dilutive and excluded from the third quarter earnings per share calculation as of May 31, 2021 compared to 20.5 million as of May 31, 2020. Due to the anti-dilutive effect resulting from the reported net loss during three months and nine months ended May 31, 2020, the incremental impact of potentially dilutive securities were omitted from the calculation of weighted-average common shares outstanding. Cash dividends declared per common share Cash dividends per common share declared were as follows: Quarter ended 2021 2020 November $ 0.4675 $ 0.4575 February $ 0.4675 $ 0.4575 May $ 0.4675 $ 0.4575 $ 1.4025 $ 1.3725 |
Subsequent events
Subsequent events | 9 Months Ended |
May 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent eventsOn June 1, 2021, the Company completed the previously announced sale of the majority of the Company's Alliance Healthcare business as well as a portion of the Company’s retail pharmacy international businesses in Europe, per the Share Purchase Agreement with AmerisourceBergen. See Note 2 Discontinued Operations for further information. The Company estimates the fair value of the proceeds from the Transaction to be approximately $6.8 billion to $6.9 billion (subject to net cash and working capital adjustments), the gain before currency translation adjustments to be approximately $1.0 billion to $1.1 billion and net gain on disposal to be approximately $0.3 billion to $0.4 billion. As of the date of this report, the Company has not completed the calculation of net gain on disposal of discontinued operations and therefore estimates presented are subject to further refinement and may result in changes. |
Accounting policies (Policies)
Accounting policies (Policies) | 9 Months Ended |
May 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2020. The coronavirus COVID-19 pandemic (“COVID-19”) has severely impacted the economies of the United States (“U.S.”), the United Kingdom (“UK”) and other countries around the world. The impact of COVID-19 on the Company’s businesses, financial position, results of operations and cash flows for the three months ended May 31, 2021, as well as information regarding certain expected or potential impacts of COVID-19 on the Company, is discussed throughout this Quarterly Report on Form 10-Q. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances including estimates of the impact of COVID-19. The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors discussed throughout this Quarterly Report on Form 10-Q including, but not limited to, the severity and duration of COVID-19, the extent to which it will impact our customers, team members, suppliers, vendors, business partners and distribution channels. The Company assessed certain accounting matters that require consideration of estimates and assumptions in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 as of May 31, 2021 and through the date of this report. The accounting matters assessed included, but were not limited to, the Company’s carrying value of goodwill, intangible and other long-lived assets including operating lease right-of-use assets. The Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. The impact of COVID-19, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payer and customer relationships and terms, strategic transactions including acquisitions, dispositions, changes in laws and general economic conditions in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. On January 6, 2021, the Company entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with AmerisourceBergen Corporation (the “Transaction”). Pursuant to the terms and subject to the conditions set forth in the Share Purchase Agreement, AmerisourceBergen Corporation (“AmerisourceBergen”) agreed to purchase the majority of the Company's Alliance Healthcare business as well as a portion of the Company’s retail pharmacy international businesses in Europe (“Disposal Group”). The Disposal Group met the criteria to be reported as held for sale and discontinued operations. Therefore, effective as of the second quarter of fiscal 2021, the related assets, liabilities and operating results of the Disposal Group have been reported as discontinued operations for all periods. The majority of the Disposal Group was previously included in the Pharmaceutical Wholesale segment. Effective as of the second quarter of fiscal year 2021, the Company eliminated the Pharmaceutical Wholesale segment and aligned into two reportable segments: United States and International. See Note 15 Segment reporting for additional information on the segments. On June 1, 2021 the Company completed the Transaction. See Note 20 Subsequent events. |
Adoption of new accounting pronouncements; New accounting pronouncements not yet adopted | Adoption of new accounting pronouncements Financial instruments In March 2020, FASB issued ASU 2020-03. This ASU improves and clarifies various financial instruments topics. The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Investments - equity securities In April 2019, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-04, Codification Improvements to Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Financial Instruments (Topic 825). This extensive ASU provides clarifications for three topics related to financial instruments accounting, some of which apply to the Company. For example, this ASU clarifies the disclosure requirements that apply to equity securities without a readily determinable fair value for which the measurement alternative is elected. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Collaborative arrangements In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808). This ASU clarifies the interaction between Topic 808, Collaborative Arrangements, and Topic 606, Revenue from Contracts with Customers. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Compensation – retirement benefits – defined benefit plans In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement benefits (Topic 715-20). This ASU amends ASC 715 to add, remove and clarify disclosure requirements related to defined benefit pension and other postretirement plans. The ASU eliminates the requirement to disclose the amounts in accumulated other comprehensive income expected to be recognized as part of net periodic benefit cost over the next year. The ASU also removes the disclosure requirements for the effects of a one-percentage-point change on the assumed health care costs and the effect of this change in rates on service cost, interest cost and the benefit obligation for postretirement health care benefits. The Company adopted the new standard effective September 1, 2020 and the adoption did not have any impact on the Company’s results of operations, cash flows or financial position. Fair value measurement In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820). The ASU eliminates such disclosures as the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy. The ASU adds new disclosure requirements for Level 3 measurements. The Company adopted the new standard effective September 1, 2020 on a retrospective basis and the adoption of this ASU did not have any impact on the Company’s results of operations, cash flows or financial position. Financial instruments - credit losses In June 2016, the FASB issued ASU 2016-13: Measurement of Credit Losses on Financial Instruments (Topic 326), which amends the Board’s guidance on the impairment of financial instruments. The ASU adds to U.S. GAAP an impairment model that is based on expected losses rather than incurred losses, which is known as the current expected credit loss (“CECL”) model. The CECL model applies to most debt instruments (other than those measured at fair value), trade and other receivables, financial guarantee contracts, and loan commitments. The Company adopted the new standard effective September 1, 2020, using a modified retrospective transition method, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The adoption did not have a material impact on the Company’s financial position or results of operations. New accounting pronouncements not yet adopted Receivables - nonrefundable fees and others In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other. This ASU clarifies the accounting for the amortization period for certain purchased callable debt securities held at a premium by giving consideration to securities which have multiple call dates. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Effects of reference rate reform on financial reporting In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to above ASU to clarify certain optional expedients in Topic 848. The ASUs can be adopted no later than December 1, 2022 with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Investments — equity securities; Investments — equity method and joint ventures; Derivatives and hedging In January 2020, the FASB issued ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). The amendments in this ASU clarify the interaction between the accounting for investments in equity securities, investment in equity method and certain derivatives instruments. The ASU is expected to reduce diversity in practice and increase comparability of the accounting for these interactions. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022). The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's results of operations, cash flows or financial position. Income taxes - simplifying the accounting for income taxes In December 2019, the FASB issued ASU 2019-12: Simplifying the Accounting for Income Taxes (Topic 740), which removes certain exceptions to the general principles in Topic 740 and improves consistent application of and simplifies GAAP for other areas of Topic 740 by clarifying and amending existing guidance. This ASU is effective for fiscal years beginning after December 15, 2020 (fiscal 2022), and interim periods within those fiscal years, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance but does not expect adoption will have a material impact on the Company's disclosures. |
Discontinued operations (Tables
Discontinued operations (Tables) | 9 Months Ended |
May 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedules of Discontinued Operations | Results of discontinued operations were as follows (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 5,500 $ 4,714 $ 16,070 $ 14,550 Cost of sales 4,956 4,235 14,486 13,089 Gross profit 544 479 1,584 1,461 Selling, general and administrative expense 394 381 1,211 1,173 Operating income from discontinued operations 150 98 373 288 Other expense (2) (2) (7) (6) Interest expense, net (13) (7) (23) (20) Earnings before income tax – discontinued operations 135 89 342 262 Income tax provision 44 3 68 24 Post tax earnings from other equity method investments 4 2 15 9 Net earnings from discontinued operations $ 95 $ 88 $ 289 $ 248 Sales from the Disposal Group to the Company's continuing operations are not eliminated and aggregate to (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 471 $ 448 $ 1,385 $ 1,370 The following table presents cash flows from operating and investing activities for discontinued operations (in millions): Nine months ended May 31, 2021 2020 Cash used in operating activities - discontinued operations $ (132) $ (157) Cash used for investing activities - discontinued operations (58) (42) May 31, 2021 August 31, 2020 Cash and cash equivalents $ 239 $ 47 Accounts receivable, net 3,524 3,022 Inventories 1,669 1,534 Other current assets 410 376 Property, plant and equipment, net 1 943 — Goodwill and intangibles 4,110 — Other assets 202 — Assets of discontinued operations - current $ 11,097 $ 4,979 Property, plant and equipment, net 1 $ — $ 816 Goodwill and intangibles — 3,936 Other non-current assets — 230 Assets of discontinued operations - non-current 2 $ — $ 4,983 Short term debt $ 366 $ 273 Trade accounts payables 4,608 4,313 Accrued expenses and other liabilities 759 746 Income taxes 11 14 Deferred income taxes 139 — Other liabilities 308 — Liabilities of discontinued operations - current $ 6,191 $ 5,347 Deferred income taxes $ — $ 131 Other non-current liabilities — 280 Liabilities of discontinued operations - non-current 2 $ — $ 412 1 Includes Operating lease right-of-use assets 2 Assets and liabilities of Disposal Group are presented as current, in the current period, as the Company completed the Transaction on June 1, 2021. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
May 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Identifiable Assets Acquired and Liabilities Assumed | The following table summarizes the consideration for the acquisition and the preliminary amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions): Purchase Price Allocation: Total Consideration $ 477 Identifiable assets acquired and liabilities assumed Tangible assets $ 58 Developed technology and other intangibles 202 Liabilities (74) Total identifiable net assets $ 186 Non-controlling interest $ 103 Goodwill $ 394 Purchase Price Allocation: Total Consideration $ 331 Identifiable assets acquired and liabilities assumed Accounts receivable, cash and other assets $ 582 Inventories 470 Property, plant and equipment 125 Short term debt (296) Trade accounts payable, accrued expenses and other liabilities (374) Other noncurrent liabilities (197) Total identifiable net assets $ 311 Goodwill $ 21 |
Schedule of Pro Forma Information | The unaudited condensed pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company's results would have been had the acquisition occurred at the beginning of the periods presented or results which may occur in the future. Three months ended May 31, Nine months ended May 31, (in millions) 2021 2020 2021 2020 Sales $ 34,030 $ 31,827 $ 99,921 $ 95,999 Actual sales for the three and nine months ended May 31, 2021 included in the Consolidated Statement of Earnings are as follows: (in millions) Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 1,532 $ 3,571 |
Exit and disposal activities (T
Exit and disposal activities (Tables) | 9 Months Ended |
May 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Costs related to exit and disposal activities under the Transformational Cost Management Program for the three and nine months ended May 31, 2021 and May 31, 2020 were as follows (in millions): Three months ended May 31, 2021 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 15 $ 6 $ — $ 21 Asset impairments 5 9 — 14 Employee severance and business transition costs (19) 2 14 (2) Information technology transformation and other exit costs 1 10 11 Total pre-tax exit and disposal charges $ 2 $ 27 $ 14 $ 44 Nine months ended May 31, 2021 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 56 $ 6 $ — $ 62 Asset impairments 9 10 — 19 Employee severance and business transition costs 92 36 44 172 Information technology transformation and other exit costs 14 11 1 26 Total pre-tax exit and disposal costs $ 172 $ 63 $ 44 $ 279 Three months ended May 31, 2020 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 170 $ 3 $ — $ 173 Asset impairments 19 10 — 29 Employee severance and business transition costs 47 (2) 11 56 Information technology transformation and other exit costs 17 16 — 33 Total pre-tax exit and disposal charges $ 253 $ 27 $ 11 $ 290 Nine months ended May 31, 2020 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 179 $ 5 $ — $ 184 Asset impairments 31 13 — 44 Employee severance and business transition costs 111 33 18 162 Information technology transformation and other exit costs 27 26 12 65 Total pre-tax exit and disposal costs $ 348 $ 76 $ 31 $ 455 |
Change in Restructuring Liabilities | The changes in liabilities and assets related to the exit and disposal activities under Transformational Cost Management Program include the following (in millions): Lease obligations and other real estate costs Asset Impairments Employee severance and business transition costs Information technology transformation and other exit costs Total Balance at August 31, 2020 $ 19 $ — $ 166 $ 14 $ 199 Costs 62 19 172 26 279 Payments (47) — (183) (18) (249) Other (9) (19) (4) (12) (43) Currency 1 (1) 4 (2) 3 Balance at May 31, 2021 $ 26 $ — $ 155 $ 9 $ 190 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
May 31, 2021 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases were as follows (in millions): Balance Sheet supplemental information: May 31, 2021 August 31, 2020 Operating Leases: Operating lease right-of-use assets $ 21,874 $ 21,453 Operating lease obligations - current 2,327 2,358 Operating lease obligations - non-current 22,088 21,765 Total operating lease obligations $ 24,416 $ 24,123 Finance Leases: Right-of-use assets included in: Property, plant and equipment, net $ 741 $ 766 Lease obligations included in: Accrued expenses and other liabilities 37 31 Other non-current liabilities 989 1,013 Total finance lease obligations $ 1,025 $ 1,044 |
Schedule of Supplemental Income Statement and Other Information | Supplemental income statement information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2021 2020 2021 2020 Operating lease cost Fixed $ 807 $ 806 $ 2,406 $ 2,436 Variable 1 157 163 477 587 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 29 Interest 13 14 39 40 Sublease income 21 24 62 56 Impairment of right-of-use assets 8 170 23 182 Impairment of finance lease assets — 21 — 24 Gains on sale-leaseback transactions 2 85 84 273 224 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded within selling, general and administrative expenses. Other supplemental information related to leases were as follows (in millions): Nine months ended May 31, Other Supplemental Information: 2021 2020 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,562 $ 2,487 Operating cash flows from finance leases 36 36 Financing cash flows from finance leases 31 36 Total $ 2,629 $ 2,559 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 2,011 $ 1,917 Finance leases — 65 Total $ 2,011 $ 1,982 Average lease term and discount rate as of May 31, 2021 and August 31, 2020 were as follows: Weighted average terms and discount rates: May 31, 2021 August 31, 2020 Weighted average remaining lease term in years: Operating leases 10.4 10.7 Finance leases 20.4 20.6 Weighted average discount rate: Operating leases 4.93 % 4.97 % Finance leases 5.18 % 5.14 % |
Schedule of Aggregate Future Lease Payments Under Operating Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2021 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2021 (Remaining period) $ 23 $ 867 2022 92 3,403 2023 91 3,296 2024 92 3,169 2025 90 3,039 2026 90 2,911 Later 1,194 14,569 Total undiscounted minimum lease payments $ 1,672 $ 31,254 Less: Present value discount (647) (6,838) Lease liability $ 1,025 $ 24,416 |
Schedule of Aggregate Future Lease Payments Under Finance Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2021 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2021 (Remaining period) $ 23 $ 867 2022 92 3,403 2023 91 3,296 2024 92 3,169 2025 90 3,039 2026 90 2,911 Later 1,194 14,569 Total undiscounted minimum lease payments $ 1,672 $ 31,254 Less: Present value discount (647) (6,838) Lease liability $ 1,025 $ 24,416 |
Equity method investments (Tabl
Equity method investments (Tables) | 9 Months Ended |
May 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity method investments as of May 31, 2021 and August 31, 2020, were as follows (in millions, except percentages): May 31, 2021 August 31, 2020 Carrying value Ownership percentage Carrying value Ownership percentage AmerisourceBergen $ 4,193 28% $ 5,446 28% Others 2,584 8% - 50% 1,758 8% - 50% Total $ 6,778 $ 7,204 |
Summarized Financial Information of Equity Method Investments | Summarized financial information for the Company’s equity method investments in aggregate is as follows: Statements of earnings (loss) (in millions) Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales $ 55,890 $ 52,772 $ 171,417 $ 157,382 Gross profit 2,558 2,253 7,647 6,476 Net earnings (loss) 489 912 (3,841) 1,268 Share of earnings (loss) from equity method investments 672 249 (591) 289 |
Goodwill and other intangible_2
Goodwill and other intangible assets (Tables) | 9 Months Ended |
May 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Changes in the carrying amount of goodwill by reportable segment consist of the following (in millions): Goodwill rollforward: United States International Walgreens Boots Alliance, Inc. August 31, 2020 $ 10,553 $ 1,460 $ 12,013 Acquisitions 394 21 416 Currency translation adjustments — 65 65 May 31, 2021 $ 10,947 $ 1,547 $ 12,493 |
Schedule of Finite-Lived Intangible Assets by Major Class | The carrying amount and accumulated amortization of intangible assets consist of the following (in millions): Intangible assets May 31, 2021 August 31, 2020 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 3,581 $ 3,502 Trade names and trademarks 373 348 Purchasing and payer contracts 337 337 Others 2 218 60 Total gross amortizable intangible assets $ 4,510 $ 4,247 Accumulated amortization Customer relationships and loyalty card holders 1 $ 1,306 $ 1,089 Trade names and trademarks 226 196 Purchasing and payer contracts 185 95 Others 2 32 26 Total accumulated amortization 1,749 1,406 Total amortizable intangible assets, net $ 2,761 $ 2,841 Indefinite-lived intangible assets Trade names and trademarks $ 5,526 $ 5,203 Pharmacy licenses 2,148 2,028 Total indefinite-lived intangible assets $ 7,675 $ 7,231 Total intangible assets, net $ 10,435 $ 10,072 1 Includes purchased prescription files. 2 Includes acquired developed technology and non-compete agreements. |
Schedule of Future Amortization Expense | Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2021 is as follows (in millions): 2022 2023 2024 2025 2026 Estimated annual amortization expense $ 439 $ 336 $ 317 $ 289 $ 262 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings | Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2021 August 31, 2020 Short-term debt Commercial paper $ 2,390 $ 1,517 Credit facilities 5 4,198 1,071 £700 million note issuance 1 2.875% unsecured Pound sterling notes due 2020 — 533 $8 billion note issuance 1 3.300% unsecured notes due 2021 1,249 — Other 2 126 144 Total short-term debt $ 7,963 $ 3,265 Long-term debt $1.5 billion note issuance 1 3.200% unsecured notes due 2030 $ 497 $ 497 4.100% unsecured notes due 2050 5 792 990 $6 billion note issuance 1 3.450% unsecured notes due 2026 5 1,442 1,891 4.650% unsecured notes due 2046 5 318 591 $8 billion note issuance 1 3.300% unsecured notes due 2021 — 1,248 3.800% unsecured notes due 2024 5 1,154 1,993 4.500% unsecured notes due 2034 5 301 496 4.800% unsecured notes due 2044 5 868 1,493 £700 million note issuance 1 3.600% unsecured Pound sterling notes due 2025 423 398 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 913 891 $4 billion note issuance 3 3.100% unsecured notes due 2022 5 731 1,198 4.400% unsecured notes due 2042 5 263 493 Other 4 31 24 Total long-term debt, less current portion $ 7,732 $ 12,203 1 Notes are unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. On October 20, 2020, the Company redeemed in full the £400 million aggregate principal amount outstanding of its 2.875% unsecured Pound sterling notes due 2020 issued by the Company on November 20, 2014. 2 Other short-term debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 Notes are senior debt obligations of Walgreen Co. and rank equally with all other unsecured and unsubordinated indebtedness of Walgreen Co. On December 31, 2014, the Company fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of the Company and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company. 4 Other long-term debt represents a mix of fixed and variable rate debt in various currencies with various maturities. 5 On April 26, 2021, the Company entered into a cash tender offer to partially purchase and retire $3.3 billion of long term U.S. dollar denominated notes with a weighted average interest rate of 4.02%, using funds drawn down from the $3.8 billion April 2021 Credit Agreement (as defined below). The Company recognized a loss of $419 million related to the early extinguishment of debt, within Interest expense, which includes $386 million of redemption premium paid in cash. The cash payments related to the early extinguishment of debt are classified as cash outflows from financing activities in the consolidated statement of cash flows. On June 1, 2021, the Company completed the previously announced sale of the Company’s Alliance Healthcare business and used a portion of the Transaction proceeds to repay all of the outstanding amount owed on the April 2021 Credit Agreement that funded the bond tender completed by the Company on April 26, 2021. |
Long-Term Debt | Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2021 August 31, 2020 Short-term debt Commercial paper $ 2,390 $ 1,517 Credit facilities 5 4,198 1,071 £700 million note issuance 1 2.875% unsecured Pound sterling notes due 2020 — 533 $8 billion note issuance 1 3.300% unsecured notes due 2021 1,249 — Other 2 126 144 Total short-term debt $ 7,963 $ 3,265 Long-term debt $1.5 billion note issuance 1 3.200% unsecured notes due 2030 $ 497 $ 497 4.100% unsecured notes due 2050 5 792 990 $6 billion note issuance 1 3.450% unsecured notes due 2026 5 1,442 1,891 4.650% unsecured notes due 2046 5 318 591 $8 billion note issuance 1 3.300% unsecured notes due 2021 — 1,248 3.800% unsecured notes due 2024 5 1,154 1,993 4.500% unsecured notes due 2034 5 301 496 4.800% unsecured notes due 2044 5 868 1,493 £700 million note issuance 1 3.600% unsecured Pound sterling notes due 2025 423 398 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 913 891 $4 billion note issuance 3 3.100% unsecured notes due 2022 5 731 1,198 4.400% unsecured notes due 2042 5 263 493 Other 4 31 24 Total long-term debt, less current portion $ 7,732 $ 12,203 1 Notes are unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. On October 20, 2020, the Company redeemed in full the £400 million aggregate principal amount outstanding of its 2.875% unsecured Pound sterling notes due 2020 issued by the Company on November 20, 2014. 2 Other short-term debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 Notes are senior debt obligations of Walgreen Co. and rank equally with all other unsecured and unsubordinated indebtedness of Walgreen Co. On December 31, 2014, the Company fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of the Company and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company. 4 Other long-term debt represents a mix of fixed and variable rate debt in various currencies with various maturities. 5 On April 26, 2021, the Company entered into a cash tender offer to partially purchase and retire $3.3 billion of long term U.S. dollar denominated notes with a weighted average interest rate of 4.02%, using funds drawn down from the $3.8 billion April 2021 Credit Agreement (as defined below). The Company recognized a loss of $419 million related to the early extinguishment of debt, within Interest expense, which includes $386 million of redemption premium paid in cash. The cash payments related to the early extinguishment of debt are classified as cash outflows from financing activities in the consolidated statement of cash flows. On June 1, 2021, the Company completed the previously announced sale of the Company’s Alliance Healthcare business and used a portion of the Transaction proceeds to repay all of the outstanding amount owed on the April 2021 Credit Agreement that funded the bond tender completed by the Company on April 26, 2021. |
Financial instruments (Tables)
Financial instruments (Tables) | 9 Months Ended |
May 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Notional Amounts, Fair Value and Balance Sheet Presentation of Derivative Instruments Outstanding | The notional amounts and fair value of derivative instruments outstanding were as follows (in millions): May 31, 2021 Notional Fair value Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Interest rate swaps $ 1,000 $ 5 Other non-current assets Cross currency interest rate swaps 992 58 Other non-current liabilities Foreign currency forwards 39 2 Other non-current liabilities Foreign currency forwards 1 — Other current assets Foreign currency forwards 635 14 Other current liabilities Cross currency interest rate swaps 113 13 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,368 $ 3 Other current assets Total return swap 244 9 Other current assets Foreign currency forwards 2,613 30 Other current liabilities August 31, 2020 Notional Fair value Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Cross currency interest rate swaps $ 722 $ 16 Other non-current assets Foreign currency forwards 49 1 Other non-current liabilities Cross currency interest rate swaps 318 13 Other non-current liabilities Interest rate swaps 1,000 10 Other non-current liabilities Foreign currency forwards 100 1 Other current assets Cross currency interest rate swaps 50 — Other current assets Foreign currency forwards 671 23 Other current liabilities Cross currency interest rate swaps 103 3 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,930 $ 19 Other current assets Foreign currency forwards 2,934 56 Other current liabilities Total return swap 205 1 Other current liabilities |
Gains and (Losses) due to Changes in Fair Value Recognized in Earnings | The income (expenses) due to changes in fair value of these derivative instruments were recognized in earnings as follows (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2021 2020 2021 2020 Foreign currency forwards Selling, general and administrative expenses $ (53) $ 72 $ (177) $ 11 Total return swaps Selling, general and administrative expenses 20 5 48 5 Foreign currency forwards Other income (expense) (5) 2 (6) 6 |
Fair value measurements (Tables
Fair value measurements (Tables) | 9 Months Ended |
May 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): May 31, 2021 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 447 $ 447 $ — $ — Investments in equity securities 2 10 10 — — Investments in debt securities 3 535 — — 535 Foreign currency forwards 4 3 — 3 — Interest rate swaps 5 5 — 5 — Total return swaps 9 — 9 — Warrants 2 — 2 — Liabilities : Foreign currency forwards 4 $ 46 $ — $ 46 $ — Cross currency interest rate swaps 5 71 — 71 — August 31, 2020 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 6 $ 6 $ — $ — Investments in equity securities 2 1 1 — — Foreign currency forwards 4 20 — 20 — Cross currency interest rate swaps 5 16 — 16 — Liabilities : Foreign currency forwards 4 $ 80 $ — $ 80 $ — Cross currency interest rate swaps 5 16 — 16 — Interest rate swaps 5 10 — 10 — Total return swaps 1 — 1 — 1 Money market funds are valued at the closing price reported by the fund sponsor. 2 Fair values of quoted investments are based on current bid prices as of May 31, 2021 and August 31, 2020. 3 Level 3 debt securities include investments in convertible debt securities of VillageMD which are valued on a quarterly basis using an option pricing method, a form of the income approach, with gains or losses recorded in Other Comprehensive Income. Inputs include the enterprise value, expected holding term of the investment, volatility and risk-free interest rates. 4 The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates. See Note 9 Financial instruments, for additional information. 5 The fair value of cross currency interest rate swaps and interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See Note 9 Financial instruments, for additional information. |
Retirement benefits (Tables)
Retirement benefits (Tables) | 9 Months Ended |
May 31, 2021 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Costs (Income) | Components of net periodic pension costs (income) for the defined benefit pension plans (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2021 2020 2021 2020 Service costs Selling, general and administrative expenses $ 2 $ — $ 4 $ 1 Interest costs Other income 36 34 104 106 Expected returns on plan assets/other Other income (85) (69) (248) (214) Total net periodic pension costs (income) $ (48) $ (35) $ (140) $ (106) |
Accumulated other comprehensi_2
Accumulated other comprehensive income (loss) (Tables) | 9 Months Ended |
May 31, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The following is a summary of net changes in accumulated other comprehensive income (“AOCI”) by component and net of tax for the three and nine months ended May 31, 2021 and May 31, 2020 (in millions): Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Unrealized gain (loss) on available for sale securities Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 28, 2021 $ (739) $ (18) $ (90) $ — $ 10 $ (2,469) $ (3,306) Other comprehensive income (loss) before reclassification adjustments — (3) (30) 5 2 141 115 Amounts reclassified from AOCI (2) 14 — — — 1 13 Tax benefit (provision) — (3) 7 — (6) — (1) Net change in other comprehensive income (loss) (1) 8 (23) 5 (4) 142 127 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Unrealized gain (loss) on available for sale securities Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2020 $ (748) $ (31) $ (34) $ — $ (10) $ (2,948) $ (3,771) Other comprehensive income (loss) before reclassification adjustments 16 11 (110) 5 21 615 558 Amounts reclassified from AOCI (6) 16 — — — 6 17 Tax benefit (provision) (3) (7) 31 — (5) — 17 Net change in other comprehensive income (loss) 8 21 (79) 5 16 621 591 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Share of AOCI of equity method investments Cumulative translation adjustments Total Balance at February 29, 2020 $ (57) $ (24) $ 34 $ (1) $ (3,360) $ (3,407) Other comprehensive income (loss) before reclassification adjustments (4) (8) 59 (18) (482) (453) Amounts reclassified from AOCI (3) 1 — — — (1) Tax benefit (provision) 4 2 (13) 3 (5) (9) Net change in other comprehensive income (loss) (2) (5) 46 (15) (487) (463) Balance at May 31, 2020 $ (59) $ (29) $ 80 $ (16) $ (3,847) $ (3,871) Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges 1 Net investment hedges Share of AOCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2019 $ (48) $ (24) $ 55 $ 3 $ (3,884) $ (3,897) Other comprehensive income (loss) before reclassification adjustments (12) (9) 31 (23) 39 26 Amounts reclassified from AOCI (3) 4 — — — 1 Tax benefit (provision) 4 1 (6) 3 (2) — Net change in other comprehensive income (loss) (11) (4) 25 (20) 37 27 Balance at May 31, 2020 $ (59) $ (29) $ 80 $ (16) $ (3,847) $ (3,871) |
Segment reporting (Tables)
Segment reporting (Tables) | 9 Months Ended |
May 31, 2021 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Income (Loss) from Segments to Consolidated | The following table reflects results of operations of the Company's reportable segments (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Sales: United States $ 28,743 $ 27,357 $ 83,250 $ 80,734 International 5,288 3,008 14,998 10,878 Walgreens Boots Alliance, Inc. $ 34,030 $ 30,364 $ 98,247 $ 91,612 Adjusted Operating income: United States $ 1,471 $ 979 $ 3,789 $ 3,704 International 94 (135) 326 155 Corporate and Other (105) (46) (233) (135) Walgreens Boots Alliance, Inc. $ 1,459 $ 798 $ 3,881 $ 3,724 The following table reconciles adjusted operating income to operating income (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Adjusted operating income $ 1,459 $ 798 $ 3,881 $ 3,724 Adjustments to equity earnings (loss) in AmerisourceBergen (48) 105 (1,575) (47) Transformational cost management (60) (310) (338) (508) Acquisition-related amortization (158) (94) (367) (290) Certain legal and regulatory accruals and settlements — — (60) — LIFO provision (51) (29) (85) (90) Acquisition-related costs (9) (68) (25) (291) Impairment of goodwill and intangible assets — (2,001) — (2,001) Store optimization — (10) — (49) Store damage and inventory losses — (75) — (75) Operating income (loss) $ 1,134 $ (1,683) $ 1,432 $ 374 |
Sales (Tables)
Sales (Tables) | 9 Months Ended |
May 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes the Company’s sales by segment and by major source (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 United States Pharmacy $ 21,770 $ 20,478 $ 63,133 $ 60,084 Retail 6,973 6,879 20,117 20,650 Total 28,743 27,357 83,250 80,734 International Pharmacy 958 794 2,791 2,531 Retail 1,455 971 4,618 4,735 Wholesale 2,875 1,243 7,588 3,611 Total 5,288 3,008 14,998 10,878 Walgreens Boots Alliance, Inc. $ 34,030 $ 30,364 $ 98,247 $ 91,612 |
Related parties (Tables)
Related parties (Tables) | 9 Months Ended |
May 31, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Related party transactions with AmerisourceBergen (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Purchases, net $ 15,947 $ 15,081 $ 46,449 $ 44,489 May 31, 2021 August 31, 2020 Trade accounts payable, net $ 6,608 $ 6,390 |
Supplemental information (Table
Supplemental information (Tables) | 9 Months Ended |
May 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Depreciation and Amortization Expense | The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions): Three months ended May 31, Nine months ended May 31, 2021 2020 2021 2020 Depreciation expense $ 352 $ 349 $ 1,042 $ 1,051 Intangible asset and other amortization 156 93 363 290 Total depreciation and amortization expense $ 507 $ 443 $ 1,404 $ 1,341 |
Restrictions on Cash and Cash Equivalents | The following represents a reconciliation of cash and cash equivalents in the Consolidated Condensed Balance Sheets to total cash, cash equivalents and restricted cash in the Consolidated Condensed Statements of Cash Flows as of May 31, 2021 and August 31, 2020 (in millions): May 31, 2021 August 31, 2020 Cash and cash equivalents - continuing operations $ 1,345 $ 469 Cash and cash equivalents - discontinued operations 239 47 Restricted cash - continuing operations (included in other current assets) 76 62 Restricted cash - discontinued operations 143 168 Cash, cash equivalents and restricted cash $ 1,803 $ 746 |
Schedule of Cash and Cash Equivalents | The following represents a reconciliation of cash and cash equivalents in the Consolidated Condensed Balance Sheets to total cash, cash equivalents and restricted cash in the Consolidated Condensed Statements of Cash Flows as of May 31, 2021 and August 31, 2020 (in millions): May 31, 2021 August 31, 2020 Cash and cash equivalents - continuing operations $ 1,345 $ 469 Cash and cash equivalents - discontinued operations 239 47 Restricted cash - continuing operations (included in other current assets) 76 62 Restricted cash - discontinued operations 143 168 Cash, cash equivalents and restricted cash $ 1,803 $ 746 |
Schedule of Dividends Payable | Cash dividends per common share declared were as follows: Quarter ended 2021 2020 November $ 0.4675 $ 0.4575 February $ 0.4675 $ 0.4575 May $ 0.4675 $ 0.4575 $ 1.4025 $ 1.3725 |
Accounting policies (Details)
Accounting policies (Details) - segment | 3 Months Ended | 9 Months Ended |
May 31, 2021 | May 31, 2021 | |
Accounting Policies [Abstract] | ||
Number of reportable segments | 2 | 2 |
Discontinued operations - Narra
Discontinued operations - Narrative (Details) - Discontinued Operations, Held-for-sale - Alliance Healthcare - USD ($) $ in Millions | Jun. 01, 2021 | Jan. 06, 2021 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Consideration from disposal | $ 6,500 | |
Cash received from disposal | $ 6,275 | $ 6,275 |
Shares issued as part of disposal (in shares) | 2,000,000 | 2,000,000 |
Discontinued operations - Sched
Discontinued operations - Schedules of Discontinued Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | Aug. 31, 2020 | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Net earnings from discontinued operations | $ 95 | $ 88 | $ 289 | $ 248 | |
Disposal Group, Including Discontinued Operation, Assets, Current [Abstract] | |||||
Assets of discontinued operations - current | 11,097 | 11,097 | $ 4,979 | ||
Disposal Group, Including Discontinued Operation, Assets, Noncurrent [Abstract] | |||||
Assets of discontinued operations - non-current | 0 | 0 | 4,983 | ||
Disposal Group, Including Discontinued Operation, Liabilities, Current [Abstract] | |||||
Liabilities of discontinued operations - current | 6,191 | 6,191 | 5,347 | ||
Disposal Group, Including Discontinued Operation, Liabilities, Noncurrent [Abstract] | |||||
Liabilities of discontinued operations - non-current | 0 | 0 | 412 | ||
Discontinued Operations, Held-for-sale | Alliance Healthcare | |||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Sales | 5,500 | 4,714 | 16,070 | 14,550 | |
Cost of sales | 4,956 | 4,235 | 14,486 | 13,089 | |
Gross profit | 544 | 479 | 1,584 | 1,461 | |
Selling, general and administrative expense | 394 | 381 | 1,211 | 1,173 | |
Operating income from discontinued operations | 150 | 98 | 373 | 288 | |
Other expense | (2) | (2) | (7) | (6) | |
Interest expense, net | (13) | (7) | (23) | (20) | |
Earnings before income tax – discontinued operations | 135 | 89 | 342 | 262 | |
Income tax provision | 44 | 3 | 68 | 24 | |
Post tax earnings from other equity method investments | 4 | 2 | 15 | 9 | |
Net earnings from discontinued operations | 95 | 88 | 289 | 248 | |
Disposal Group, Including Discontinued Operation, Additional Disclosures [Abstract] | |||||
Sales | 5,500 | 4,714 | 16,070 | 14,550 | |
Net Cash Provided by (Used in) Discontinued Operations [Abstract] | |||||
Cash used in operating activities - discontinued operations | (132) | (157) | |||
Cash used for investing activities - discontinued operations | (58) | (42) | |||
Disposal Group, Including Discontinued Operation, Assets, Current [Abstract] | |||||
Cash and cash equivalents | 239 | 239 | 47 | ||
Accounts receivable, net | 3,524 | 3,524 | 3,022 | ||
Inventories | 1,669 | 1,669 | 1,534 | ||
Other current assets | 410 | 410 | 376 | ||
Property, plant and equipment, net | 943 | 943 | 0 | ||
Goodwill and intangibles | 4,110 | 4,110 | 0 | ||
Other assets | 202 | 202 | 0 | ||
Assets of discontinued operations - current | 11,097 | 11,097 | 4,979 | ||
Disposal Group, Including Discontinued Operation, Assets, Noncurrent [Abstract] | |||||
Property, plant and equipment, net | 0 | 0 | 816 | ||
Goodwill and intangibles | 0 | 0 | 3,936 | ||
Other non-current assets | 0 | 0 | 230 | ||
Assets of discontinued operations - non-current | 0 | 0 | 4,983 | ||
Disposal Group, Including Discontinued Operation, Liabilities, Current [Abstract] | |||||
Short term debt | 366 | 366 | 273 | ||
Trade accounts payables | 4,608 | 4,608 | 4,313 | ||
Accrued expenses and other liabilities | 759 | 759 | 746 | ||
Income taxes | 11 | 11 | 14 | ||
Deferred income taxes | 139 | 139 | 0 | ||
Other liabilities | 308 | 308 | 0 | ||
Liabilities of discontinued operations - current | 6,191 | 6,191 | 5,347 | ||
Disposal Group, Including Discontinued Operation, Liabilities, Noncurrent [Abstract] | |||||
Deferred income taxes | 0 | 0 | 131 | ||
Other non-current liabilities | 0 | 0 | 280 | ||
Liabilities of discontinued operations - non-current | 0 | 0 | $ 412 | ||
Discontinued Operations, Held-for-sale | Alliance Healthcare | Continuing Operations | |||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||
Sales | 471 | 448 | 1,385 | 1,370 | |
Disposal Group, Including Discontinued Operation, Additional Disclosures [Abstract] | |||||
Sales | $ 471 | $ 448 | $ 1,385 | $ 1,370 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Millions | Dec. 29, 2020 | Nov. 01, 2020 | May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 |
Innovation Associates, Inc. | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 451 | |||||
McKesson Corporation, GEHE Pharma Handel | ||||||
Business Acquisition [Line Items] | ||||||
Controlling interest percentage | 70.00% | |||||
Noncash purchase consideration | $ 296 | |||||
Other Acquisitions | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration | $ 19 | $ 27 | $ 85 | $ 166 |
Acquisitions - Schedule of Purc
Acquisitions - Schedule of Purchase Price Allocation and Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Dec. 29, 2020 | Nov. 01, 2020 | May 31, 2021 | Aug. 31, 2020 |
Identifiable assets acquired and liabilities assumed | ||||
Goodwill | $ 12,493 | $ 12,013 | ||
Innovation Associates, Inc. | ||||
Business Acquisition [Line Items] | ||||
Total Consideration | $ 477 | |||
Identifiable assets acquired and liabilities assumed | ||||
Tangible assets | 58 | |||
Developed technology and other intangibles | 202 | |||
Liabilities | (74) | |||
Total identifiable net assets | 186 | |||
Non-controlling interest | 103 | |||
Goodwill | $ 394 | |||
McKesson Corporation, GEHE Pharma Handel | ||||
Business Acquisition [Line Items] | ||||
Total Consideration | $ 331 | |||
Identifiable assets acquired and liabilities assumed | ||||
Accounts receivable, cash and other assets | 582 | |||
Inventories | 470 | |||
Property, plant and equipment | 125 | |||
Short term debt | (296) | |||
Trade accounts payable, accrued expenses and other liabilities | (374) | |||
Other noncurrent liabilities | (197) | |||
Total identifiable net assets | 311 | |||
Goodwill | $ 21 |
Acquisitions - Schedule of Pro
Acquisitions - Schedule of Pro Forma and Actual Information (Details) - McKesson Corporation, GEHE Pharma Handel - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Business Acquisition [Line Items] | ||||
Sales | $ 34,030 | $ 31,827 | $ 99,921 | $ 95,999 |
Sales | $ 1,532 | $ 3,571 |
Exit and disposal activities -
Exit and disposal activities - Narrative (Details) $ in Millions | Dec. 20, 2018USD ($) | Oct. 24, 2017store | May 31, 2021USD ($)segment | May 31, 2020USD ($) | May 31, 2021USD ($)storesegment | May 31, 2020USD ($) | Aug. 31, 2020USD ($)store | Feb. 28, 2021USD ($) | Feb. 29, 2020USD ($) | Sep. 01, 2019USD ($) | Aug. 31, 2019USD ($) |
Restructuring Cost and Reserve [Line Items] | |||||||||||
Number of reportable segments | segment | 2 | 2 | |||||||||
Cumulative effect adjustment to decrease retained earnings | $ (22,596) | $ (21,323) | $ (22,596) | $ (21,323) | $ (21,136) | $ (21,625) | $ (24,334) | $ (24,152) | |||
Adoption of new accounting standards | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Cumulative effect adjustment to decrease retained earnings | 6 | 442 | |||||||||
Retained earnings | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Cumulative effect adjustment to decrease retained earnings | (34,908) | (34,244) | (34,908) | (34,244) | (34,210) | $ (34,116) | $ (36,351) | (35,815) | |||
Retained earnings | Adoption of new accounting standards | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Cumulative effect adjustment to decrease retained earnings | $ 3 | $ 442 | |||||||||
Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Costs incurred | 1,200 | 1,200 | |||||||||
Restructuring charges | 44 | 290 | $ 279 | 455 | |||||||
Transformational Cost Management Program | United Kingdom | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Number of stores expected to close | store | 200 | ||||||||||
Transformational Cost Management Program | United States | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Number of stores expected to close | store | 250 | ||||||||||
Transformational Cost Management Program | Retained earnings | Adoption of new accounting standards | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Cumulative effect adjustment to decrease retained earnings | $ 508 | ||||||||||
Store Optimization Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Number of stores expected to close | store | 600 | ||||||||||
Number of stores closed | store | 769 | ||||||||||
Lease obligations and other real estate costs | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Costs incurred | 293 | $ 293 | |||||||||
Restructuring charges | 21 | 173 | 62 | 184 | |||||||
Lease obligations and other real estate costs | Store Optimization Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring charges | 3 | 24 | |||||||||
Asset impairments | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Costs incurred | 245 | 245 | |||||||||
Restructuring charges | 14 | 29 | 19 | 44 | |||||||
Employee severance and business transition costs | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Costs incurred | 517 | 517 | |||||||||
Restructuring charges | (2) | 56 | 172 | 162 | |||||||
Information technology transformation and other exit costs | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Costs incurred | 153 | 153 | |||||||||
Restructuring charges | 11 | 33 | 26 | 65 | |||||||
Employee severance and other exit costs | Store Optimization Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring charges | $ 7 | $ 25 | |||||||||
Minimum | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected annual cost savings of restructuring plan | $ 2,000 | ||||||||||
Expected cost | 2,100 | 2,100 | |||||||||
Minimum | Exit and disposal costs | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected cost | 1,800 | 1,800 | |||||||||
Maximum | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected cost | 2,300 | 2,300 | |||||||||
Maximum | Exit and disposal costs | Transformational Cost Management Program | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected cost | $ 2,000 | $ 2,000 |
Exit and disposal activities _2
Exit and disposal activities - Restructuring Costs (Details) - Transformational Cost Management Program - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 44 | $ 290 | $ 279 | $ 455 |
Reportable Segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 2 | 253 | 172 | 348 |
Reportable Segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 27 | 27 | 63 | 76 |
Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 11 | 44 | 31 |
Lease obligations and other real estate costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 21 | 173 | 62 | 184 |
Lease obligations and other real estate costs | Reportable Segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 15 | 170 | 56 | 179 |
Lease obligations and other real estate costs | Reportable Segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 6 | 3 | 6 | 5 |
Lease obligations and other real estate costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Asset impairments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 29 | 19 | 44 |
Asset impairments | Reportable Segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 5 | 19 | 9 | 31 |
Asset impairments | Reportable Segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 9 | 10 | 10 | 13 |
Asset impairments | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Employee severance and business transition costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | (2) | 56 | 172 | 162 |
Employee severance and business transition costs | Reportable Segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | (19) | 47 | 92 | 111 |
Employee severance and business transition costs | Reportable Segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 2 | (2) | 36 | 33 |
Employee severance and business transition costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 11 | 44 | 18 |
Information technology transformation and other exit costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 11 | 33 | 26 | 65 |
Information technology transformation and other exit costs | Reportable Segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 17 | 14 | 27 |
Information technology transformation and other exit costs | Reportable Segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 10 | 16 | 11 | 26 |
Information technology transformation and other exit costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 0 | $ 1 | $ 12 |
Exit and disposal activities _3
Exit and disposal activities - Restructuring Reserve Activity (Details) - Transformational Cost Management Program $ in Millions | 9 Months Ended |
May 31, 2021USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 199 |
Costs | 279 |
Payments | (249) |
Other | (43) |
Currency | 3 |
Ending balance | 190 |
Lease obligations and other real estate costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 19 |
Costs | 62 |
Payments | (47) |
Other | (9) |
Currency | 1 |
Ending balance | 26 |
Asset impairments | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 0 |
Costs | 19 |
Payments | 0 |
Other | (19) |
Currency | (1) |
Ending balance | 0 |
Employee severance and business transition costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 166 |
Costs | 172 |
Payments | (183) |
Other | (4) |
Currency | 4 |
Ending balance | 155 |
Information technology transformation and other exit costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 14 |
Costs | 26 |
Payments | (18) |
Other | (12) |
Currency | (2) |
Ending balance | $ 9 |
Leases - Narrative (Details)
Leases - Narrative (Details) | May 31, 2021 |
Lessee, Lease, Description [Line Items] | |
Term of renewal contract | 5 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Term of lease | 15 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Term of lease | 25 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 |
Operating Leases: | ||
Operating lease right-of-use assets | $ 21,874 | $ 21,453 |
Operating lease obligations - current | 2,327 | 2,358 |
Operating lease obligations - non-current | 22,088 | 21,765 |
Total operating lease obligations | 24,416 | 24,123 |
Finance Leases: | ||
Property, plant and equipment, net | 741 | 766 |
Lease obligations included in: | ||
Accrued expenses and other liabilities | 37 | 31 |
Other non-current liabilities | 989 | 1,013 |
Total finance lease obligations | $ 1,025 | $ 1,044 |
Finance lease, right-of-use asset, statement of financial position, extensible enumeration | Property, plant and equipment, net | Property, plant and equipment, net |
Finance lease, liability, current, statement of financial position, extensible enumeration | Accrued expenses and other liabilities | Accrued expenses and other liabilities |
Finance lease, liability, noncurrent, statement of financial position, extensible enumeration | Other non-current liabilities | Other non-current liabilities |
Leases - Supplemental Income St
Leases - Supplemental Income Statement Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Operating lease cost | ||||
Fixed | $ 807 | $ 806 | $ 2,406 | $ 2,436 |
Variable | 157 | 163 | 477 | 587 |
Finance lease cost | ||||
Amortization | 11 | 11 | 33 | 29 |
Interest | 13 | 14 | 39 | 40 |
Sublease income | 21 | 24 | 62 | 56 |
Impairment of right-of-use assets | 8 | 170 | 23 | 182 |
Impairment of finance lease assets | 0 | 21 | 0 | 24 |
Gains on sale-leaseback transactions | $ 85 | $ 84 | $ 273 | $ 224 |
Leases - Other Supplemental Inf
Leases - Other Supplemental Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Cash paid for amounts included in the measurement of lease obligations | ||
Operating cash flows from operating leases | $ 2,562 | $ 2,487 |
Operating cash flows from finance leases | 36 | 36 |
Financing cash flows from finance leases | 31 | 36 |
Total | 2,629 | 2,559 |
Right-of-use assets obtained in exchange for new lease obligations: | ||
Operating leases | 2,011 | 1,917 |
Finance leases | 0 | 65 |
Total | $ 2,011 | $ 1,982 |
Leases - Average Lease Terms An
Leases - Average Lease Terms And Discounts (Details) | May 31, 2021 | Aug. 31, 2020 |
Weighted average remaining lease term in years: | ||
Operating leases | 10 years 4 months 24 days | 10 years 8 months 12 days |
Finance leases | 20 years 4 months 24 days | 20 years 7 months 6 days |
Weighted average discount rate: | ||
Operating leases | 4.93% | 4.97% |
Finance leases | 5.18% | 5.14% |
Leases - Future Lease Payments
Leases - Future Lease Payments for Operating and Finance Leases (Details) - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 |
Finance lease | ||
2021 (Remaining period) | $ 23 | |
2022 | 92 | |
2023 | 91 | |
2024 | 92 | |
2025 | 90 | |
2026 | 90 | |
Later | 1,194 | |
Total undiscounted minimum lease payments | 1,672 | |
Less: Present value discount | (647) | |
Lease liability | 1,025 | $ 1,044 |
Operating lease | ||
2021 (Remaining period) | 867 | |
2022 | 3,403 | |
2023 | 3,296 | |
2024 | 3,169 | |
2025 | 3,039 | |
2026 | 2,911 | |
Later | 14,569 | |
Total undiscounted minimum lease payments | 31,254 | |
Less: Present value discount | (6,838) | |
Lease liability | $ 24,416 | $ 24,123 |
Equity method investments - Sch
Equity method investments - Schedule of Equity Method Investments (Details) - USD ($) $ in Millions | Jun. 01, 2021 | May 31, 2021 | Aug. 31, 2020 |
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 6,778 | $ 7,204 | |
AmerisourceBergen | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 4,193 | $ 5,446 | |
Ownership percentage | 28.40% | 27.70% | 27.70% |
Others | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 2,584 | $ 1,758 | |
Others | Minimum | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage | 8.00% | 8.00% | |
Others | Maximum | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage | 50.00% | 50.00% | |
Total | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 6,778 | $ 7,204 |
Equity method investments - Nar
Equity method investments - Narrative (Details) - USD ($) $ in Millions | Jun. 01, 2021 | Jan. 06, 2021 | May 31, 2021 | Nov. 30, 2020 | Sep. 30, 2020 | May 31, 2020 | May 31, 2021 | May 31, 2020 | Aug. 31, 2020 |
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (loss) in AmerisourceBergen | $ 97 | $ 243 | $ (1,196) | $ 284 | |||||
Equity earnings (losses) | (577) | 297 | |||||||
Gain on sale of equity method investment | $ 290 | 0 | |||||||
Discontinued Operations, Held-for-sale | Alliance Healthcare | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Cash received from disposal | $ 6,275 | $ 6,275 | |||||||
Shares issued as part of disposal (in shares) | 2,000,000 | 2,000,000 | |||||||
AmerisourceBergen | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Outstanding shares owned | 56,854,867 | 56,854,867 | 56,854,867 | ||||||
Ownership percentage | 28.40% | 27.70% | 27.70% | 27.70% | |||||
Period of reporting lag | 2 months | ||||||||
Equity earnings (losses) | $ (1,373) | ||||||||
Equity investment, exceeded its proportionate share of net assets | $ 4,200 | $ 4,200 | |||||||
AmerisourceBergen | Opiod Litigation | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (losses) | $ (5,600) | ||||||||
AmerisourceBergen | Level 1 | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Fair market value of equity investment | 6,500 | 6,500 | |||||||
Other Investments | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (losses) | 575 | $ 6 | 604 | $ 5 | |||||
Option Care Health | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (losses) | 576 | ||||||||
Gain on sale of equity method investment | 98 | 290 | |||||||
Option Care Health | HC Group Holdings I, LLC | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | 1,200 | ||||||||
VillageMD | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Consideration transferred to acquire equity method investments | 750 | ||||||||
Payments to acquire equity method investments | 250 | ||||||||
Convertible debt | $ 500 | $ 500 |
Equity method investments - Sum
Equity method investments - Summarized Financial Information of Equity Method Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Income Statement [Abstract] | ||||
Sales | $ 34,030 | $ 30,364 | $ 98,247 | $ 91,612 |
Gross profit | 7,153 | 5,959 | 20,564 | 19,753 |
Net earnings (loss) | 1,173 | (1,726) | 1,899 | 68 |
Share of earnings (loss) from equity method investments | 672 | 249 | (591) | 289 |
Equity Method Investment | ||||
Income Statement [Abstract] | ||||
Sales | 55,890 | 52,772 | 171,417 | 157,382 |
Gross profit | 2,558 | 2,253 | 7,647 | 6,476 |
Net earnings (loss) | $ 489 | $ 912 | $ (3,841) | $ 1,268 |
Goodwill and other intangible_3
Goodwill and other intangible assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | Aug. 31, 2020 | Jun. 01, 2020 | |
Goodwill [Line Items] | ||||||
Goodwill | $ 12,493 | $ 12,493 | $ 12,013 | |||
Indefinite-lived intangible assets | 7,675 | 7,675 | $ 7,231 | |||
Amortization of intangible assets | 156 | $ 94 | 363 | $ 290 | ||
Minimum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 4.00% | |||||
Maximum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 239.00% | |||||
Other International Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 4.00% | |||||
Goodwill | 400 | 400 | ||||
Boots Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 1,100 | 1,100 | ||||
Indefinite-lived intangible assets | $ 7,700 | $ 7,700 | ||||
Boots Reporting Unit | Minimum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 4.00% | |||||
Boots Reporting Unit | Maximum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 31.00% |
Goodwill and other intangible_4
Goodwill and other intangible assets - Schedule of Goodwill (Details) $ in Millions | 9 Months Ended |
May 31, 2021USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 12,013 |
Acquisitions | 416 |
Currency translation adjustments | 65 |
Goodwill, ending balance | 12,493 |
Reportable Segments | United States | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 10,553 |
Acquisitions | 394 |
Currency translation adjustments | 0 |
Goodwill, ending balance | 10,947 |
Reportable Segments | International | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 1,460 |
Acquisitions | 21 |
Currency translation adjustments | 65 |
Goodwill, ending balance | $ 1,547 |
Goodwill and other intangible_5
Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets by Major Class (Details) - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | $ 4,510 | $ 4,247 |
Accumulated amortization | 1,749 | 1,406 |
Total amortizable intangible assets, net | 2,761 | 2,841 |
Indefinite-lived intangible assets | 7,675 | 7,231 |
Total intangible assets, net | 10,435 | 10,072 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 5,526 | 5,203 |
Pharmacy licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 2,148 | 2,028 |
Customer relationships and loyalty card holders | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 3,581 | 3,502 |
Accumulated amortization | 1,306 | 1,089 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 373 | 348 |
Accumulated amortization | 226 | 196 |
Purchasing and payer contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 337 | 337 |
Accumulated amortization | 185 | 95 |
Others | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 218 | 60 |
Accumulated amortization | $ 32 | $ 26 |
Goodwill and other intangible_6
Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions | May 31, 2021USD ($) |
Estimated annual intangible assets amortization expense [Abstract] | |
2022 | $ 439 |
2023 | 336 |
2024 | 317 |
2025 | 289 |
2026 | $ 262 |
Debt - Short and Long-Term Debt
Debt - Short and Long-Term Debt (Details) | Apr. 26, 2021USD ($) | May 31, 2021USD ($) | May 31, 2020USD ($) | May 31, 2021GBP (£) | May 31, 2021EUR (€) | Oct. 20, 2020GBP (£) | Aug. 31, 2020USD ($) | Apr. 15, 2020USD ($) |
Debt Instrument [Line Items] | ||||||||
Total short-term debt | $ 7,963,000,000 | $ 3,265,000,000 | ||||||
Total long-term debt, less current portion | 7,732,000,000 | 12,203,000,000 | ||||||
Long-term debt purchased and retired | 11,050,000,000 | $ 16,871,000,000 | ||||||
Loss on early extinguishment of debt | $ 419,000,000 | $ 0 | ||||||
2.875% unsecured Pound sterling notes due 2020 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | ÂŁ | ÂŁ 700,000,000 | |||||||
Stated interest rate | 2.875% | 2.875% | 2.875% | 2.875% | ||||
Total short-term debt | $ 0 | 533,000,000 | ||||||
Debt redeemed | ÂŁ | ÂŁ 400,000,000 | |||||||
3.300% unsecured notes due 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 8,000,000,000 | |||||||
Stated interest rate | 3.30% | 3.30% | 3.30% | |||||
Total short-term debt | $ 1,249,000,000 | 0 | ||||||
Other | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | 126,000,000 | 144,000,000 | ||||||
Total $1.5 billion note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,500,000,000 | |||||||
Unsecured Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Other | 31,000,000 | 24,000,000 | ||||||
Total long-term debt, less current portion | 7,732,000,000 | 12,203,000,000 | ||||||
Long-term debt purchased and retired | $ 3,300,000,000 | |||||||
Weighted average interest rate of long-term debt purchased and retired | 4.02% | |||||||
Loss on early extinguishment of debt | $ 419,000,000 | $ 387,000,000 | ||||||
Redemption premiums paid in cash | 386,000,000 | |||||||
Unsecured Notes | 3.300% unsecured notes due 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.30% | 3.30% | 3.30% | |||||
Long-term debt | $ 0 | 1,248,000,000 | ||||||
Unsecured Notes | Total $1.5 billion note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,500,000,000 | |||||||
Unsecured Notes | 3.200% unsecured notes due 2030 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 500,000,000 | |||||||
Stated interest rate | 3.20% | 3.20% | 3.20% | 3.20% | ||||
Long-term debt | $ 497,000,000 | 497,000,000 | ||||||
Unsecured Notes | 4.100% unsecured notes due 2050 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,000,000,000 | |||||||
Stated interest rate | 4.10% | 4.10% | 4.10% | 4.10% | ||||
Long-term debt | $ 792,000,000 | 990,000,000 | ||||||
Debt redeemed | $ 200,000,000 | |||||||
Unsecured Notes | Total $6 billion note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 6,000,000,000 | |||||||
Unsecured Notes | 3.450% unsecured notes due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.45% | 3.45% | 3.45% | |||||
Long-term debt | $ 1,442,000,000 | 1,891,000,000 | ||||||
Unsecured Notes | 4.650% unsecured notes due 2046 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.65% | 4.65% | 4.65% | |||||
Long-term debt | $ 318,000,000 | 591,000,000 | ||||||
Unsecured Notes | Total $8 billion note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 8,000,000,000 | |||||||
Unsecured Notes | 3.800% unsecured notes due 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.80% | 3.80% | 3.80% | |||||
Long-term debt | $ 1,154,000,000 | 1,993,000,000 | ||||||
Unsecured Notes | 4.500% unsecured notes due 2034 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.50% | 4.50% | 4.50% | |||||
Long-term debt | $ 301,000,000 | 496,000,000 | ||||||
Unsecured Notes | 4.800% unsecured notes due 2044 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.80% | 4.80% | 4.80% | |||||
Long-term debt | $ 868,000,000 | 1,493,000,000 | ||||||
Unsecured Notes | Total ÂŁ700 million note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | ÂŁ | ÂŁ 700,000,000 | |||||||
Unsecured Notes | 3.600% unsecured Pound sterling notes due 2025 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.60% | 3.60% | 3.60% | |||||
Long-term debt | $ 423,000,000 | 398,000,000 | ||||||
Unsecured Notes | Total €750 million note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | € | € 750,000,000 | |||||||
Unsecured Notes | 2.125% unsecured Euro notes due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 2.125% | 2.125% | 2.125% | |||||
Long-term debt | $ 913,000,000 | 891,000,000 | ||||||
Unsecured Notes | Total $4 billion note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 4,000,000,000 | |||||||
Unsecured Notes | 3.100% unsecured notes due 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.10% | 3.10% | 3.10% | |||||
Long-term debt | $ 731,000,000 | 1,198,000,000 | ||||||
Unsecured Notes | 4.400% unsecured notes due 2042 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.40% | 4.40% | 4.40% | |||||
Long-term debt | $ 263,000,000 | 493,000,000 | ||||||
Commercial paper | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | 2,390,000,000 | 1,517,000,000 | ||||||
Credit facilities | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | $ 4,198,000,000 | $ 1,071,000,000 |
Debt - Narrative (Details)
Debt - Narrative (Details) € in Millions | Apr. 26, 2021USD ($) | Jan. 28, 2021USD ($) | Dec. 23, 2020USD ($) | Aug. 30, 2019USD ($)credit_agreement | May 31, 2021USD ($) | May 31, 2021EUR (€) | May 31, 2020USD ($) | Apr. 23, 2021USD ($) | Apr. 09, 2021USD ($) | May 29, 2020USD ($) | Apr. 15, 2020USD ($) | Apr. 07, 2020USD ($) | Apr. 02, 2020USD ($) | Apr. 01, 2020USD ($) | Jan. 18, 2019USD ($) | Dec. 05, 2018USD ($) | Nov. 30, 2018USD ($) | Aug. 29, 2018USD ($) |
Debt Instrument [Line Items] | ||||||||||||||||||
Interest paid | $ 889,000,000 | $ 510,000,000 | ||||||||||||||||
Loss on early extinguishment of debt | $ 419,000,000 | 0 | ||||||||||||||||
Maximum | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt to total capitalization ratio | 0.60 | |||||||||||||||||
Commercial paper | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Average daily short-term borrowings | $ 2,300,000,000 | $ 2,600,000,000 | ||||||||||||||||
Weighted average interest rate | 0.47% | 0.47% | 2.33% | |||||||||||||||
Commercial paper | Guarantor Subsidiaries | Reportable Legal Entities | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Average daily short-term borrowings | $ 424,000,000 | € 300 | ||||||||||||||||
Weighted average interest rate | 0.43% | 0.43% | ||||||||||||||||
Total $1.5 billion note issuance | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 1,500,000,000 | |||||||||||||||||
Debt issuance costs | 13,000,000 | |||||||||||||||||
Unsecured Notes | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Loss on early extinguishment of debt | $ 419,000,000 | $ 387,000,000 | ||||||||||||||||
Unsecured Notes | Total $1.5 billion note issuance | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 1,500,000,000 | |||||||||||||||||
Unsecured Notes | 3.200% unsecured notes due 2030 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 500,000,000 | |||||||||||||||||
Stated interest rate | 3.20% | 3.20% | ||||||||||||||||
Unsecured Notes | 4.100% unsecured notes due 2050 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 1,000,000,000 | |||||||||||||||||
Stated interest rate | 4.10% | 4.10% | ||||||||||||||||
Debt redeemed | $ 200,000,000 | |||||||||||||||||
Unsecured Notes | December 2018 Term Loan Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 1,000,000,000 | |||||||||||||||||
Credit facilities | 2020 Revolving Credit Agreement, 364-Day Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 1,250,000,000 | |||||||||||||||||
Credit facilities | 2020 Revolving Credit Agreement, 18-Month Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 2,250,000,000 | |||||||||||||||||
Debt term | 18 months | |||||||||||||||||
Borrowing outstanding | $ 400,000,000 | |||||||||||||||||
Credit facilities | April 7, 2020 Revolving Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||||||||||||
Credit facilities | April 2020 Revolving Bilateral Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 750,000,000 | |||||||||||||||||
Credit facilities | April 2020 Revolving Club Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 1,325,000,000 | |||||||||||||||||
Credit facilities | August 2019 Revolving Credit Agreements | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||||||||||||
Debt term | 18 months | |||||||||||||||||
Number of credit agreements | credit_agreement | 3 | |||||||||||||||||
Credit facilities | January 2019 364-Day Revolving Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | $ 2,000,000,000 | ||||||||||||||||
Credit facility, amount terminated | $ 1,500,000,000 | |||||||||||||||||
Credit facilities | A&R December 2018 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | 2,000,000,000 | |||||||||||||||||
Credit facilities | November 2018 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 1,000,000,000 | |||||||||||||||||
Credit facilities | August 2018 Revolving Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 3,500,000,000 | |||||||||||||||||
Credit facilities | Unsecured Notes | A&R December 2018 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 1,000,000,000 | |||||||||||||||||
Credit facilities | Line of Credit | November 2018 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | 500,000,000 | ||||||||||||||||
Credit facilities | Term Loan | April 2021 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 3,800,000,000 | $ 2,750,000,000 | ||||||||||||||||
Borrowing outstanding | $ 3,800,000,000 | |||||||||||||||||
Credit facilities | Term Loan | November 2018 Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 1,000,000,000 | $ 500,000,000 | ||||||||||||||||
Bridge Loan | 2020 Revolving Credit Agreement, 18-Month Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 350,000,000 | |||||||||||||||||
Letter of Credit | August 2018 Revolving Credit Agreement | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount | $ 500,000,000 |
Financial instruments (Details)
Financial instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | Aug. 31, 2020 | |
Foreign currency forwards | Not Designated as Hedging Instrument | Selling, general and administrative expenses | |||||
Derivatives, Fair Value [Line Items] | |||||
Gains and (losses) due to changes in fair value of derivative instruments | $ (53) | $ 72 | $ (177) | $ 11 | |
Foreign currency forwards | Not Designated as Hedging Instrument | Other income (expense) | |||||
Derivatives, Fair Value [Line Items] | |||||
Gains and (losses) due to changes in fair value of derivative instruments | (5) | 2 | (6) | 6 | |
Total return swap | Not Designated as Hedging Instrument | Selling, general and administrative expenses | |||||
Derivatives, Fair Value [Line Items] | |||||
Gains and (losses) due to changes in fair value of derivative instruments | 20 | $ 5 | 48 | $ 5 | |
Other non-current assets | Interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 1,000 | 1,000 | |||
Fair value, assets | 5 | 5 | |||
Other non-current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | $ 722 | ||||
Fair value, assets | 16 | ||||
Other current assets | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 1 | 1 | 100 | ||
Fair value, assets | 0 | 0 | 1 | ||
Other current assets | Foreign currency forwards | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 1,368 | 1,368 | 1,930 | ||
Fair value, assets | 3 | 3 | 19 | ||
Other current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 50 | ||||
Fair value, assets | 0 | ||||
Other current assets | Total return swap | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 244 | 244 | |||
Fair value, assets | 9 | 9 | |||
Other non-current liabilities | Interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 1,000 | ||||
Fair value, liabilities | 10 | ||||
Other non-current liabilities | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 39 | 39 | 49 | ||
Fair value, liabilities | 2 | 2 | 1 | ||
Other non-current liabilities | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 992 | 992 | 318 | ||
Fair value, liabilities | 58 | 58 | 13 | ||
Other current liabilities | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 635 | 635 | 671 | ||
Fair value, liabilities | 14 | 14 | 23 | ||
Other current liabilities | Foreign currency forwards | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 2,613 | 2,613 | 2,934 | ||
Fair value, liabilities | 30 | 30 | 56 | ||
Other current liabilities | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 113 | 113 | 103 | ||
Fair value, liabilities | $ 13 | $ 13 | 3 | ||
Other current liabilities | Total return swap | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 205 | ||||
Fair value, liabilities | $ 1 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 |
Recurring | ||
Assets [Abstract] | ||
Money market funds | $ 447 | $ 6 |
Investments in equity securities | 10 | 1 |
Investments in debt securities | 535 | |
Recurring | Level 1 | ||
Assets [Abstract] | ||
Money market funds | 447 | 6 |
Investments in equity securities | 10 | 1 |
Investments in debt securities | 0 | |
Recurring | Level 2 | ||
Assets [Abstract] | ||
Money market funds | 0 | 0 |
Investments in equity securities | 0 | 0 |
Investments in debt securities | 0 | |
Recurring | Level 3 | ||
Assets [Abstract] | ||
Money market funds | 0 | 0 |
Investments in equity securities | 0 | 0 |
Investments in debt securities | 535 | |
Recurring | Foreign currency forwards | ||
Assets [Abstract] | ||
Derivative asset | 3 | 20 |
Liabilities [Abstract] | ||
Derivative liability | 46 | 80 |
Recurring | Foreign currency forwards | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liability | 0 | 0 |
Recurring | Foreign currency forwards | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 3 | 20 |
Liabilities [Abstract] | ||
Derivative liability | 46 | 80 |
Recurring | Foreign currency forwards | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liability | 0 | 0 |
Recurring | Cross currency interest rate swaps | ||
Assets [Abstract] | ||
Derivative asset | 16 | |
Liabilities [Abstract] | ||
Derivative liability | 71 | 16 |
Recurring | Cross currency interest rate swaps | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | 0 | 0 |
Recurring | Cross currency interest rate swaps | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 16 | |
Liabilities [Abstract] | ||
Derivative liability | 71 | 16 |
Recurring | Cross currency interest rate swaps | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | 0 | 0 |
Recurring | Interest rate swaps | ||
Assets [Abstract] | ||
Derivative asset | 5 | |
Liabilities [Abstract] | ||
Derivative liability | 10 | |
Recurring | Interest rate swaps | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | 0 | |
Recurring | Interest rate swaps | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 5 | |
Liabilities [Abstract] | ||
Derivative liability | 10 | |
Recurring | Interest rate swaps | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | 0 | |
Recurring | Warrants | ||
Assets [Abstract] | ||
Derivative asset | 2 | |
Recurring | Warrants | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Recurring | Warrants | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 2 | |
Recurring | Warrants | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Recurring | Total return swap | ||
Assets [Abstract] | ||
Derivative asset | 9 | |
Liabilities [Abstract] | ||
Derivative liability | 1 | |
Recurring | Total return swap | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | 0 | |
Recurring | Total return swap | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 9 | |
Liabilities [Abstract] | ||
Derivative liability | 1 | |
Recurring | Total return swap | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | |
Liabilities [Abstract] | ||
Derivative liability | $ 0 | |
Carrying Value | ||
Liabilities [Abstract] | ||
Carrying value of long-term notes outstanding | 8,900 | |
Estimate of Fair Value Measurement | ||
Liabilities [Abstract] | ||
Fair value of long-term notes outstanding | $ 9,700 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Income Tax Examination [Line Items] | ||||
Effective tax rate | 32.80% | 2.30% | 7.40% | 230.00% |
Equity earnings | $ (577) | $ 297 | ||
Income taxes paid | 305 | $ 604 | ||
Amount of potential decrease in unrecognized tax benefits during next twelve months | $ 110 | $ 110 | ||
Option Care Health | ||||
Income Tax Examination [Line Items] | ||||
Equity earnings | $ 576 |
Retirement benefits (Details)
Retirement benefits (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Components of net periodic benefit costs [Abstract] | ||||
Total net periodic pension costs (income) | $ (48) | $ (35) | $ (140) | $ (106) |
Employer cash contributions to defined benefit pension plans | 37 | |||
Expected employer cash contributions to defined benefit plan in current fiscal year | 2 | 2 | ||
Selling, general and administrative expenses | ||||
Components of net periodic benefit costs [Abstract] | ||||
Service costs | 2 | 0 | 4 | 1 |
Other income | ||||
Components of net periodic benefit costs [Abstract] | ||||
Interest costs | 36 | 34 | 104 | 106 |
Expected returns on plan assets/other | (85) | (69) | (248) | (214) |
United States | ||||
Components of net periodic benefit costs [Abstract] | ||||
Profit sharing provision expense | 54 | 57 | 166 | 171 |
Foreign Plan | ||||
Components of net periodic benefit costs [Abstract] | ||||
Cost recognized in the consolidated condensed statements of earnings | $ 25 | $ 26 | $ 77 | $ 80 |
Accumulated other comprehensi_3
Accumulated other comprehensive income (loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 21,625 | $ 24,334 | $ 21,136 | $ 24,152 |
Total other comprehensive income | 131 | (474) | 607 | 31 |
Ending balance | 22,596 | 21,323 | 22,596 | 21,323 |
Pension/ post-retirement obligations | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (739) | (57) | (748) | (48) |
Other comprehensive income (loss) before reclassification adjustments | 0 | (4) | 16 | (12) |
Amounts reclassified from AOCI | (2) | (3) | (6) | (3) |
Tax benefit (provision) | 0 | 4 | (3) | 4 |
Total other comprehensive income | (1) | (2) | 8 | (11) |
Ending balance | (740) | (59) | (740) | (59) |
Unrealized gain (loss) on cash flow hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (18) | (24) | (31) | (24) |
Other comprehensive income (loss) before reclassification adjustments | (3) | (8) | 11 | (9) |
Amounts reclassified from AOCI | 14 | 1 | 16 | 4 |
Tax benefit (provision) | (3) | 2 | (7) | 1 |
Total other comprehensive income | 8 | (5) | 21 | (4) |
Ending balance | (10) | (29) | (10) | (29) |
Net investment hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (90) | 34 | (34) | 55 |
Other comprehensive income (loss) before reclassification adjustments | (30) | 59 | (110) | 31 |
Amounts reclassified from AOCI | 0 | 0 | 0 | 0 |
Tax benefit (provision) | 7 | (13) | 31 | (6) |
Total other comprehensive income | (23) | 46 | (79) | 25 |
Ending balance | (113) | 80 | (113) | 80 |
Unrealized gain (loss) on available for sale securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | 0 | ||
Other comprehensive income (loss) before reclassification adjustments | 5 | 5 | ||
Amounts reclassified from AOCI | 0 | 0 | ||
Tax benefit (provision) | 0 | 0 | ||
Total other comprehensive income | 5 | 5 | ||
Ending balance | 5 | 5 | ||
Share of OCI of equity method investments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 10 | (1) | (10) | 3 |
Other comprehensive income (loss) before reclassification adjustments | 2 | (18) | 21 | (23) |
Amounts reclassified from AOCI | 0 | 0 | 0 | 0 |
Tax benefit (provision) | (6) | 3 | (5) | 3 |
Total other comprehensive income | (4) | (15) | 16 | (20) |
Ending balance | 6 | (16) | 6 | (16) |
Cumulative translation adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (2,469) | (3,360) | (2,948) | (3,884) |
Other comprehensive income (loss) before reclassification adjustments | 141 | (482) | 615 | 39 |
Amounts reclassified from AOCI | 1 | 0 | 6 | 0 |
Tax benefit (provision) | 0 | (5) | 0 | (2) |
Total other comprehensive income | 142 | (487) | 621 | 37 |
Ending balance | (2,327) | (3,847) | (2,327) | (3,847) |
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (3,306) | (3,407) | (3,771) | (3,897) |
Other comprehensive income (loss) before reclassification adjustments | 115 | (453) | 558 | 26 |
Amounts reclassified from AOCI | 13 | (1) | 17 | 1 |
Tax benefit (provision) | (1) | (9) | 17 | 0 |
Total other comprehensive income | 127 | (463) | 591 | 27 |
Ending balance | $ (3,180) | $ (3,871) | $ (3,180) | $ (3,871) |
Segment reporting (Details)
Segment reporting (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021USD ($)segment | May 31, 2020USD ($) | May 31, 2021USD ($)segment | May 31, 2020USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | segment | 2 | 2 | ||
Sales | $ 34,030 | $ 30,364 | $ 98,247 | $ 91,612 |
Adjusted operating income | 1,459 | 798 | 3,881 | 3,724 |
Adjustments to equity earnings (loss) in AmerisourceBergen | (48) | 105 | (1,575) | (47) |
Transformational cost management | (60) | (310) | (338) | (508) |
Acquisition-related amortization | (158) | (94) | (367) | (290) |
Certain legal and regulatory accruals and settlements | 0 | 0 | (60) | 0 |
LIFO provision | (51) | (29) | (85) | (90) |
Acquisition-related costs | (9) | (68) | (25) | (291) |
Impairment of goodwill and intangible assets | 0 | (2,001) | 0 | (2,001) |
Store optimization | 0 | (10) | 0 | (49) |
Store damage and inventory losses | 0 | (75) | 0 | (75) |
Operating income (loss) | 1,134 | (1,683) | 1,432 | 374 |
Reportable Segments | United States | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 28,743 | 27,357 | 83,250 | 80,734 |
Adjusted operating income | 1,471 | 979 | 3,789 | 3,704 |
Reportable Segments | International | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 5,288 | 3,008 | 14,998 | 10,878 |
Adjusted operating income | 94 | (135) | 326 | 155 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted operating income | $ (105) | $ (46) | $ (233) | $ (135) |
Sales (Details)
Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 34,030 | $ 30,364 | $ 98,247 | $ 91,612 |
Reportable Segments | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 28,743 | 27,357 | 83,250 | 80,734 |
Reportable Segments | United States | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 21,770 | 20,478 | 63,133 | 60,084 |
Reportable Segments | United States | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 6,973 | 6,879 | 20,117 | 20,650 |
Reportable Segments | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 5,288 | 3,008 | 14,998 | 10,878 |
Reportable Segments | International | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 958 | 794 | 2,791 | 2,531 |
Reportable Segments | International | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 1,455 | 971 | 4,618 | 4,735 |
Reportable Segments | International | Wholesale | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 2,875 | $ 1,243 | $ 7,588 | $ 3,611 |
Related parties (Details)
Related parties (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | Aug. 31, 2020 | |
Related Party Transactions [Abstract] | |||||
Purchases, net | $ 15,947 | $ 15,081 | $ 46,449 | $ 44,489 | |
Trade accounts payable, net | $ 6,608 | $ 6,608 | $ 6,390 |
Supplemental information - Narr
Supplemental information - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
May 31, 2021 | May 31, 2020 | Aug. 31, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable from related party | $ 1,300 | $ 1,100 | |
Accumulated depreciation and amortization on property, plant, and equipment | 13,000 | 12,100 | |
Redeemable noncontrolling interest | $ 310 | 0 | |
Antidilutive securities excluded from EPS calculations (in shares) | 15.9 | 20.5 | |
Trade Accounts Receivable | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Receivables | $ 3,900 | $ 3,000 |
Supplemental information - Depr
Supplemental information - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2021 | May 31, 2020 | May 31, 2021 | May 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | ||||
Depreciation expense | $ 352 | $ 349 | $ 1,042 | $ 1,051 |
Intangible asset and other amortization | 156 | 93 | 363 | 290 |
Total depreciation and amortization expense | $ 507 | $ 443 | $ 1,404 | $ 1,341 |
Supplemental information - Summ
Supplemental information - Summary of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | May 31, 2021 | Aug. 31, 2020 | May 31, 2020 | Aug. 31, 2019 |
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $ 1,345 | $ 469 | ||
Cash, cash equivalents and restricted cash | 1,803 | 746 | $ 943 | $ 1,207 |
Continuing Operations | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | 1,345 | 469 | ||
Restricted cash | 76 | 62 | ||
Discontinued Operations | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | 239 | 47 | ||
Restricted cash | $ 143 | $ 168 |
Supplemental information - Su_2
Supplemental information - Summary of Dividends per Share (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||||||
May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | May 31, 2021 | May 31, 2020 | |
Cash and Cash Equivalents [Abstract] | ||||||||
Cash dividends declared (in dollars per share) | $ 0.4675 | $ 0.4675 | $ 0.4675 | $ 0.4575 | $ 0.4575 | $ 0.4575 | $ 1.4025 | $ 1.3725 |
Subsequent events (Details)
Subsequent events (Details) - Discontinued Operations, Disposed of by Sale - Alliance Healthcare - Subsequent Event $ in Billions | Jun. 01, 2021USD ($) |
Minimum | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Estimated fair value of proceeds from disposition | $ 6.8 |
Gain before currency translation adjustments | 1 |
Net gain on disposal of discontinued operation | 0.3 |
Maximum | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Estimated fair value of proceeds from disposition | 6.9 |
Gain before currency translation adjustments | 1.1 |
Net gain on disposal of discontinued operation | $ 0.4 |