Cover Page
Cover Page | 9 Months Ended |
May 31, 2022 shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | May 31, 2022 |
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 | 864,256,651 |
Entity Central Index Key | 0001618921 |
Current Fiscal Year End Date | --08-31 |
Document Fiscal Year Focus | 2022 |
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, 2022 | Aug. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 2,285 | $ 559 |
Marketable securities | 2,173 | 634 |
Accounts receivable, net | 5,034 | 5,663 |
Inventories | 8,520 | 8,159 |
Other current assets | 859 | 800 |
Total current assets | 18,872 | 15,814 |
Non-current assets: | ||
Property, plant and equipment, net | 11,789 | 12,247 |
Operating lease right-of-use assets | 21,369 | 21,893 |
Goodwill | 21,901 | 12,421 |
Intangible assets, net | 11,583 | 9,936 |
Equity method investments (see Note 6) | 5,777 | 6,987 |
Other non-current assets | 1,469 | 1,987 |
Total non-current assets | 73,887 | 65,471 |
Total assets | 92,759 | 81,285 |
Current liabilities: | ||
Short-term debt | 2,787 | 1,305 |
Trade accounts payable (see Note 17) | 11,794 | 11,136 |
Operating lease obligations | 2,270 | 2,259 |
Accrued expenses and other liabilities | 7,156 | 7,260 |
Income taxes | 60 | 94 |
Total current liabilities | 24,067 | 22,054 |
Non-current liabilities: | ||
Long-term debt | 10,670 | 7,675 |
Operating lease obligations | 21,550 | 22,153 |
Deferred income taxes | 1,578 | 1,850 |
Other non-current liabilities | 3,737 | 3,413 |
Total non-current liabilities | 37,535 | 35,091 |
Commitments and contingencies (see Note 11) | ||
Total liabilities | 61,602 | 57,145 |
Redeemable non-controlling interest | 775 | 319 |
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, 2022 and August 31, 2021 | 12 | 12 |
Paid-in capital | 11,029 | 10,988 |
Retained earnings | 38,632 | 35,121 |
Accumulated other comprehensive loss | (2,724) | (2,109) |
Treasury stock, at cost; 308,256,967 shares at May 31, 2022 and 307,139,982 shares at August 31, 2021 | (20,696) | (20,593) |
Total Walgreens Boots Alliance, Inc. shareholders’ equity | 26,253 | 23,419 |
Non-controlling interests | 4,129 | 402 |
Total equity | 30,382 | 23,822 |
Total liabilities, redeemable non-controlling interest and equity | $ 92,759 | $ 81,285 |
CONSOLIDATED CONDENSED BALANC_2
CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | May 31, 2022 | Aug. 31, 2021 |
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) | 308,256,967 | 307,139,982 |
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 earnings Adoption of new accounting standards | Non-controlling interests | Non-controlling interests Adoption of new accounting standards |
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 (loss) income, net of tax | 607 | 591 | 15 | |||||||
Dividends declared and distributions | (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 (loss) income, net of tax | 131 | 127 | 4 | |||||||
Dividends declared and distributions | (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 | |||
Beginning balance (in shares) at Aug. 31, 2021 | 865,373,636 | |||||||||
Beginning balance at Aug. 31, 2021 | 23,822 | $ 12 | (20,593) | 10,988 | (2,109) | 35,121 | 402 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | 4,611 | 4,752 | (141) | |||||||
Other comprehensive (loss) income, net of tax | (637) | (616) | (20) | |||||||
Dividends declared and distributions | (1,253) | (1,241) | (12) | |||||||
Treasury stock purchases (in shares) | (3,910,000) | |||||||||
Treasury stock purchases | (187) | (187) | ||||||||
Employee stock purchase and option plans (in shares) | 2,793,015 | |||||||||
Employee stock purchase and option plans | 13 | 84 | (71) | |||||||
Stock-based compensation | 185 | 118 | 67 | |||||||
Acquisition of non-controlling interests | (55) | 62 | (117) | |||||||
Business combination | 3,944 | 3,944 | ||||||||
Redeemable non-controlling interests redemption price adjustments and other | (62) | (67) | 5 | |||||||
Ending balance (in shares) at May. 31, 2022 | 864,256,651 | |||||||||
Ending balance at May. 31, 2022 | 30,382 | $ 12 | (20,696) | 11,029 | (2,724) | 38,632 | 4,129 | |||
Beginning balance (in shares) at Feb. 28, 2022 | 863,773,464 | |||||||||
Beginning balance at Feb. 28, 2022 | 30,867 | $ 12 | (20,712) | 10,973 | (2,328) | 38,757 | 4,166 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net earnings (loss) | 241 | 289 | (48) | |||||||
Other comprehensive (loss) income, net of tax | (416) | (397) | (19) | |||||||
Dividends declared and distributions | (420) | (413) | (6) | |||||||
Employee stock purchase and option plans (in shares) | 483,187 | |||||||||
Employee stock purchase and option plans | 11 | 16 | (5) | |||||||
Stock-based compensation | 71 | 38 | 33 | |||||||
Acquisition of non-controlling interests | (1) | (1) | ||||||||
Redeemable non-controlling interests redemption price adjustments and other | 28 | 23 | 5 | |||||||
Ending balance (in shares) at May. 31, 2022 | 864,256,651 | |||||||||
Ending balance at May. 31, 2022 | $ 30,382 | $ 12 | $ (20,696) | $ 11,029 | $ (2,724) | $ 38,632 | $ 4,129 |
CONSOLIDATED CONDENSED STATEM_2
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Income Statement [Abstract] | ||||
Sales | $ 32,597 | $ 34,030 | $ 100,254 | $ 98,247 |
Cost of sales | 26,025 | 26,877 | 78,399 | 77,684 |
Gross profit | 6,572 | 7,153 | 21,855 | 20,564 |
Selling, general and administrative expenses | 7,019 | 6,116 | 19,975 | 17,936 |
Equity earnings (loss) in AmerisourceBergen | 127 | 97 | 330 | (1,196) |
Operating (loss) income | (320) | 1,134 | 2,209 | 1,432 |
Other income | 410 | 159 | 2,829 | 473 |
Earnings before interest and tax | 90 | 1,294 | 5,038 | 1,905 |
Interest expense, net | 108 | 545 | 295 | 817 |
(Loss) earnings before tax | (18) | 749 | 4,743 | 1,088 |
Income tax (benefit) provision | (242) | 246 | 205 | 81 |
Post tax earnings from other equity method investments | 5 | 575 | 29 | 604 |
Net earnings from continuing operations | 229 | 1,078 | 4,566 | 1,610 |
Net earnings from discontinued operations | 0 | 95 | 0 | 289 |
Net earnings | 229 | 1,173 | 4,566 | 1,899 |
Net (loss) attributable to non-controlling interests - continuing operations | (60) | (27) | (186) | (25) |
Net earnings attributable to non-controlling interests - discontinued operations | 0 | 2 | 0 | 9 |
Net earnings attributable to Walgreens Boots Alliance, Inc. | 289 | 1,197 | 4,752 | 1,915 |
Net earnings attributable to Walgreens Boots Alliance, Inc.: | ||||
Continuing operations | 289 | 1,105 | 4,752 | 1,636 |
Discontinued operations | 0 | 92 | 0 | 279 |
Total | $ 289 | $ 1,197 | $ 4,752 | $ 1,915 |
Basic net earnings per common share: | ||||
Continuing operations (in dollars per share) | $ 0.33 | $ 1.28 | $ 5.50 | $ 1.89 |
Discontinued operations (in dollars per share) | 0 | 0.11 | 0 | 0.32 |
Total (in dollars per share) | 0.33 | 1.38 | 5.50 | 2.21 |
Diluted net earnings per common share: | ||||
Continuing operations (in dollars per share) | 0.33 | 1.27 | 5.49 | 1.89 |
Discontinued operations (in dollars per share) | 0 | 0.11 | 0 | 0.32 |
Total (in dollars per share) | $ 0.33 | $ 1.38 | $ 5.49 | $ 2.21 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 864 | 864,700 | 864.4 | 864.7 |
Diluted (in shares) | 865.3 | 867 | 866 | 866.2 |
CONSOLIDATED CONDENSED STATEM_3
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Comprehensive (loss) income: | ||||
Net earnings | $ 229 | $ 1,173 | $ 4,566 | $ 1,899 |
Other comprehensive (loss) income, net of tax: | ||||
Pension/postretirement obligations | (4) | (1) | (17) | 8 |
Unrealized gain on cash flow hedges | 4 | 8 | 6 | 21 |
Net investment hedges | 135 | (23) | 159 | (79) |
Available for sale debt securities | 0 | 5 | (96) | 5 |
Share of other comprehensive (loss) income of equity method investments | (17) | (4) | (143) | 16 |
Currency translation adjustments | (535) | 146 | (545) | 636 |
Total other comprehensive (loss) income, net | (416) | 131 | (637) | 607 |
Total comprehensive (loss) income, net | (187) | 1,304 | 3,929 | 2,506 |
Comprehensive loss attributable to non-controlling interests | (79) | (19) | (206) | (1) |
Comprehensive (loss) income attributable to Walgreens Boots Alliance, Inc. | $ (108) | $ 1,323 | $ 4,135 | $ 2,506 |
CONSOLIDATED CONDENSED STATEM_4
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2022 | May 31, 2021 | |
Cash flows from operating activities: | ||
Net earnings | $ 4,566 | $ 1,899 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 1,502 | 1,455 |
Deferred income taxes | (168) | (210) |
Stock compensation expense | 266 | 120 |
Equity (earnings) loss from equity method investments | (359) | 577 |
Loss on early extinguishment of debt | 4 | 419 |
Gain on previously held investment interests | (2,576) | 0 |
Gain on sale of equity method investments | (421) | (290) |
Impairment of equity method investments and investments in debt and equity securities | 233 | 0 |
Other | (199) | (141) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 725 | (897) |
Inventories | (510) | 71 |
Other current assets | (58) | 18 |
Trade accounts payable | 767 | 927 |
Accrued expenses and other liabilities | (362) | 428 |
Income taxes | 82 | 54 |
Other non-current assets and liabilities | 320 | (120) |
Net cash provided by operating activities | 3,813 | 4,310 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (1,241) | (1,001) |
Proceeds from sale-leaseback transactions | 809 | 662 |
Proceeds from sale of other assets | 976 | 406 |
Business, investment and asset acquisitions, net of cash acquired | (2,040) | (1,394) |
Other | 233 | (14) |
Net cash used for investing activities | (1,262) | (1,341) |
Cash flows from financing activities: | ||
Net change in short-term debt with maturities of 3 months or less | (10) | 1,556 |
Proceeds from debt | 11,944 | 12,720 |
Payments of debt | (7,350) | (11,050) |
Acquisition of non-controlling interests | (2,108) | 0 |
Stock purchases | (187) | (110) |
Proceeds related to employee stock plans, net | 13 | 41 |
Cash dividends paid | (1,251) | (1,212) |
Early debt extinguishment | (458) | (3,687) |
Other | 160 | (114) |
Net cash provided by (used for) financing activities | 753 | (1,856) |
Effect of exchange rate changes on cash, cash equivalents, marketable securities and restricted cash | (33) | (55) |
Changes in cash, cash equivalents, marketable securities and restricted cash: | ||
Net increase in cash, cash equivalents, marketable securities and restricted cash | 3,270 | 1,058 |
Cash, cash equivalents, marketable securities and restricted cash at beginning of period | 1,270 | 746 |
Cash, cash equivalents, marketable securities and restricted cash at end of period | $ 4,541 | $ 1,803 |
Accounting policies
Accounting policies | 9 Months Ended |
May 31, 2022 | |
Accounting Policies [Abstract] | |
Accounting policies | Note 1. 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. However, 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, 2021, as amended by Form 10-K/A for the fiscal year ended August 31, 2021 filed on November 24, 2021. 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 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, 2022 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, payor 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 June 1, 2021, the Company completed the 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 (“Disposal Group”) to AmerisourceBergen Corporation (“AmerisourceBergen”). The Disposal Group met the criteria to be reported as discontinued operations. Therefore, the operating results of the Disposal Group are reported as discontinued operations for all prior periods. Effective as of the first quarter of fiscal year 2022, the Company is aligned into three reportable segments: United States, International and Walgreens Health. Unless otherwise specified, disclosures in these Consolidated Condensed Financial Statements reflect continuing operations only. See Note 2. Discontinued operations and Note 15. Segment reporting 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. Note 18. New accounting pronouncements Adoption of new accounting pronouncements 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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 the above ASU to clarify certain optional expedients in Topic 848. The Company adopted the new standard effective September 1, 2021, and the adoption did not have a material impact on the Company’s results of operations, cash flows or financial position. New accounting pronouncements not yet adopted Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal year 2024). The Company is evaluating the effect of adopting this new accounting guidance. Disclosures by business entities about government assistance In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) – Disclosures by Business Entities about Government Assistance. This ASU requires disclosures that are expected to increase the transparency of transactions with a government accounted for by applying a grant or contribution accounting model by analogy, including (1) the types of transactions, (2) the accounting for those transactions, and (3) the effect of those transactions on an entity’s financial statements. This ASU is effective for annual periods beginning after December 15, 2021 (fiscal year 2023). The Company is evaluating the effect of adopting this new accounting guidance. |
Discontinued operations
Discontinued operations | 9 Months Ended |
May 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued operations | Note 2. Discontinued operations On June 1, 2021, the Company completed the sale of Alliance Healthcare, for total consideration of $6.9 billion, which included cash consideration of $6.7 billion, subject to net working capital and net cash adjustments, and 2 million shares of AmerisourceBergen common stock. As of August 31, 2021, Other current assets included a $98 million receivable for purchase price consideration due from AmerisourceBergen that was subject to change upon the finalization of net working capital adjustments. During the three months ended February 28, 2022, the Company reduced the receivable by $38 million with a corresponding charge in Other income within the Consolidated Condensed Statements of Earnings upon finalizing these adjustments with AmerisourceBergen. The operating results of the Disposal Group are reported as discontinued operations as the disposition reflected a strategic shift that had a major effect on the Company’s operations and financial results. Results of discontinued operations for prior periods were as follows (in millions): Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 5,500 $ 16,070 Cost of sales 4,956 14,486 Gross profit 544 1,584 Selling, general and administrative expense 394 1,211 Operating income from discontinued operations 150 373 Other expense (2) (7) Interest expense, net (13) (23) Earnings before income tax – discontinued operations 135 342 Income tax provision 44 68 Post tax earnings from other equity method investments 4 15 Net earnings from discontinued operations $ 95 $ 289 Sales in prior periods from the Disposal Group to the Company's continuing operations are not eliminated and aggregate to (in millions): Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 471 $ 1,385 Cash flows from operating and investing activities for discontinued operations in prior periods are (in millions): Nine months ended May 31, 2021 Cash used for operating activities - discontinued operations $ (132) Cash used for investing activities - discontinued operations $ (58) See Note 17. Related parties, to the Consolidated Condensed Financial Statements for more information on the Company's transactions and continuing involvement with AmerisourceBergen. |
Acquisitions and other investme
Acquisitions and other investments | 9 Months Ended |
May 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and other investments | Note 3. Acquisitions and other investments VillageMD On November 24, 2021, the Company completed the acquisition of Village Practice Management Company, LLC (“VillageMD”). Pursuant to the terms and subject to the conditions set forth in the Unit Purchase Agreement, the Company purchased additional outstanding equity interests of VillageMD, increasing the Company’s total beneficial ownership in VillageMD’s outstanding equity interests from approximately 30% to approximately 63%, on a fully diluted basis, for a purchase price of $5.2 billion. The total purchase price comprises cash consideration of $4.0 billion and a promissory note of $1.2 billion. The cash consideration of $4.0 billion consisted of $2.9 billion paid to existing shareholders, including $1.9 billion paid to existing shareholders as part of the fully subscribed tender offer concluded on December 28, 2021, and $1.1 billion paid in exchange for new preferred units issued by VillageMD. Subject to notice being served, the Company has an option to prepay, and VillageMD has an option to require redemption of, the promissory note at any time. The promissory note is eliminated in consolidation within the Consolidated Condensed Balance Sheets. The Company accounted for this acquisition as a business combination resulting in consolidation of VillageMD within the Walgreens Health segment in its financial statements. A non-controlling interest was recognized at fair value. During the three and nine months ended May 31, 2022, the Company recorded certain measurement period adjustments based on additional information primarily to certain assets and liabilities which did not have a material impact on goodwill. As of May 31, 2022, the Company had not completed the analysis to assign fair values to all tangible and intangible assets acquired. As such, the preliminary purchase price allocation will be subject to further refinement and may change. 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. As a result of this acquisition, in the three months ended November 30, 2021, the Company recognized a pre-tax gain in Other income in the Consolidated Condensed Statements of Earnings of $1,597 million related to the fair valuation of the Company’s previously held minority equity interest. The Company also recorded a pre-tax gain of $577 million in Other income in the Consolidated Condensed Statements of Earnings related to the conversion to equity of the Company’s previously held investment in convertible debt securities of VillageMD, reclassified from within Accumulated other comprehensive income in the Consolidated Condensed Balance Sheets. 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 purchase price $ 5,200 Less: purchase price for issuance of new preferred units at fair value 1 (2,300) Net consideration 2,900 Fair value of share-based compensation awards attributable to pre-combination services 2 683 Fair value of previously held equity and debt 3,211 Fair value of non-controlling interest 3,257 Total $ 10,051 Identifiable assets acquired and liabilities assumed: Tangible assets 1 $ 634 Intangible assets 1,621 Liabilities (245) Total identifiable net assets $ 2,010 Goodwill $ 8,041 1. Comprises cash consideration of $1.1 billion and a promissory note of $1.2 billion. This consideration was provided in exchange for the issuance of new preferred units by VillageMD. VillageMD’s tangible assets acquired exclude this $1.1 billion of cash and $1.2 billion promissory note receivable. 2. Primarily related to vested share-based compensation awards. The goodwill represents anticipated future growth and expansion opportunities into new markets. Pro forma sales and 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. Shields acquisition On October 29, 2021, the Company completed the acquisition of Shields Health Solutions Parent, LLC (“Shields”). Pursuant to the terms and subject to the conditions set forth in the Securities Purchase Agreement, the Company purchased additional outstanding equity interests of Shields, increasing the Company’s total beneficial ownership in Shields’ outstanding equity interests from 25% to approximately 70%, for cash consideration of $969 million. The Company accounted for this acquisition as a business combination resulting in consolidation of Shields within the Walgreens Health segment in its financial statements. A non-controlling interest was recognized at fair value. Under the terms of the transaction agreements, the Company has an option to acquire the remaining equity interests of Shields in the future. Shields’ other equity holders will also have an option to require the Company to purchase the remaining equity interests. Considering the contractual terms related to the non-controlling interest, it is classified as redeemable non-controlling interest in the Consolidated Condensed Balance Sheets. As of May 31, 2022, the Company had not completed the analysis to assign fair values to all tangible and intangible assets acquired. As such, 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. As a result of this acquisition, in the three months ended November 30, 2021, the Company remeasured its previously held minority equity interest in Shields at fair value resulting in a pre-tax gain of $402 million recognized in Other income in the Consolidated Condensed Statements of Earnings. 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: Cash consideration $ 969 Fair value of share-based compensation awards attributable to pre-combination services 13 Fair value of previously held equity interests 502 Fair value of non-controlling interests 589 Total $ 2,074 Identifiable assets acquired and liabilities assumed: Tangible assets $ 84 Intangible assets 1,060 Liabilities (528) Total identifiable net assets $ 616 Goodwill $ 1,457 The goodwill represents anticipated future growth and expansion opportunities into new healthcare offerings. Pro forma sales and 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. See Note 15. Segment reporting and Note 16. Sales for further information. Other acquisitions and investments The Company acquired certain prescription files and related pharmacy inventory primarily in the U.S. for the aggregate purchase price of $36 million and $153 million during the three and nine months ended May 31, 2022, respectively, and $19 million and $85 million during the three and nine months ended May 31, 2021, respectively. |
Exit and disposal activities
Exit and disposal activities | 9 Months Ended |
May 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Exit and disposal activities | Note 4. 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 year 2022 (the “Transformational Cost Management Program”). The Company achieved this goal at the end of fiscal year 2021. On October 12, 2021, the Company expanded and extended the Transformational Cost Management Program through the end of fiscal 2024 and increased its annual cost savings target to $3.3 billion by the end of fiscal 2024. During the three months ended May 31, 2022, the Company increased its annual cost savings target from $3.3 billion to $3.5 billion by the end of fiscal 2024. The Company is currently on track to achieve the savings target. 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 which focus on the United States and International reportable segments along with the Company’s global functions. Divisional optimization within the Company’s segments includes activities such as optimization of stores. As a result of the expanded program, the Company plans to reduce its presence by up to 150 Boots stores in the UK and up to 150 stores in the United States over the next three years which are incremental to the previously planned reductions of 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 of approximately $3.6 billion to $3.9 billion, of which $3.3 billion to $3.6 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 transition adjustments to decrease retained earnings due to the adoption of the new lease accounting standard (Topic 842) that became effective on September 1, 2019. From the inception of the Transformational Cost Management Program to May 31, 2022, the Company has recognized cumulative pre-tax charges to its financial results in accordance with GAAP of $1.7 billion, which were primarily recorded within selling, general and administrative expenses. These charges included $467 million related to lease obligations and other real estate costs, $357 million in asset impairments, $679 million in employee severance and business transition costs and $183 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, 2022 and 2021 were as follows (in millions): Three months ended May 31, 2022 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 16 $ 3 $ — $ 18 Asset impairments 48 14 — 61 Employee severance and business transition costs 53 22 11 86 Information technology transformation and other exit costs 1 6 — 7 Total pre-tax exit and disposal charges $ 117 $ 45 $ 11 $ 173 Nine months ended May 31, 2022 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 107 $ 6 $ — $ 113 Asset impairments 64 42 — 105 Employee severance and business transition costs 110 32 25 166 Information technology transformation and other exit costs 3 18 — 20 Total pre-tax exit and disposal charges $ 283 $ 97 $ 25 $ 404 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 charges $ 172 $ 63 $ 44 $ 279 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, 2021 $ 17 $ — $ 77 $ 20 $ 114 Costs 113 105 166 20 404 Payments (60) — (145) (24) (229) Other (52) (105) (6) 2 (161) Balance at May 31, 2022 $ 18 $ — $ 92 $ 20 $ 129 |
Leases
Leases | 9 Months Ended |
May 31, 2022 | |
Leases [Abstract] | |
Leases | Note 5. Leases The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. For the majority of 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. Lease commencement is 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, 2022 August 31, 2021 Operating leases: Operating lease right-of-use assets $ 21,369 $ 21,893 Operating lease obligations - current 2,270 2,259 Operating lease obligations - non-current 21,550 22,153 Total operating lease obligations $ 23,820 $ 24,412 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 664 $ 725 Lease obligations included in: Accrued expenses and other liabilities 37 37 Other non-current liabilities 919 974 Total finance lease obligations $ 956 $ 1,010 Supplemental Statement of Earnings information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2022 2021 2022 2021 Operating lease cost Fixed $ 811 $ 807 $ 2,431 $ 2,406 Variable 1 198 157 600 477 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 33 Interest 13 13 38 39 Sublease income $ 24 $ 21 $ 76 $ 62 Impairment of right-of-use assets 11 8 82 23 Gain on sale-leaseback 2 175 85 410 273 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: 2022 2021 Cash paid for amounts included in the measurement of lease obligations: Operating cash outflows from operating leases $ 2,515 $ 2,562 Operating cash outflows from finance leases 35 36 Financing cash outflows from finance leases 32 31 Total $ 2,582 $ 2,629 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 1,380 $ 2,011 Finance leases 11 — Total $ 1,391 $ 2,011 Weighted average lease terms and discount rates for real estate leases were as follows: Weighted average terms and discount rates: May 31, 2022 August 31, 2021 Weighted average remaining lease term in years: Operating leases 10.0 10.3 Finance leases 19.2 20.2 Weighted average discount rate: Operating leases 4.77 % 4.77 % Finance leases 5.18 % 5.18 % The aggregate future lease payments for operating and finance leases as of May 31, 2022 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2022 (Remaining period) $ 22 $ 867 2023 88 3,399 2024 88 3,295 2025 87 3,185 2026 87 3,081 2027 87 2,977 Later 1,052 13,412 Total undiscounted minimum lease payments $ 1,510 $ 30,216 Less: Present value discount (554) (6,396) Lease liability $ 956 $ 23,820 |
Leases | Note 5. Leases The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. For the majority of 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. Lease commencement is 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, 2022 August 31, 2021 Operating leases: Operating lease right-of-use assets $ 21,369 $ 21,893 Operating lease obligations - current 2,270 2,259 Operating lease obligations - non-current 21,550 22,153 Total operating lease obligations $ 23,820 $ 24,412 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 664 $ 725 Lease obligations included in: Accrued expenses and other liabilities 37 37 Other non-current liabilities 919 974 Total finance lease obligations $ 956 $ 1,010 Supplemental Statement of Earnings information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2022 2021 2022 2021 Operating lease cost Fixed $ 811 $ 807 $ 2,431 $ 2,406 Variable 1 198 157 600 477 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 33 Interest 13 13 38 39 Sublease income $ 24 $ 21 $ 76 $ 62 Impairment of right-of-use assets 11 8 82 23 Gain on sale-leaseback 2 175 85 410 273 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: 2022 2021 Cash paid for amounts included in the measurement of lease obligations: Operating cash outflows from operating leases $ 2,515 $ 2,562 Operating cash outflows from finance leases 35 36 Financing cash outflows from finance leases 32 31 Total $ 2,582 $ 2,629 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 1,380 $ 2,011 Finance leases 11 — Total $ 1,391 $ 2,011 Weighted average lease terms and discount rates for real estate leases were as follows: Weighted average terms and discount rates: May 31, 2022 August 31, 2021 Weighted average remaining lease term in years: Operating leases 10.0 10.3 Finance leases 19.2 20.2 Weighted average discount rate: Operating leases 4.77 % 4.77 % Finance leases 5.18 % 5.18 % The aggregate future lease payments for operating and finance leases as of May 31, 2022 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2022 (Remaining period) $ 22 $ 867 2023 88 3,399 2024 88 3,295 2025 87 3,185 2026 87 3,081 2027 87 2,977 Later 1,052 13,412 Total undiscounted minimum lease payments $ 1,510 $ 30,216 Less: Present value discount (554) (6,396) Lease liability $ 956 $ 23,820 |
Equity method investments
Equity method investments | 9 Months Ended |
May 31, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity method investments | Note 6. Equity method investments Equity method investments were as follows (in millions, except percentages): May 31, 2022 August 31, 2021 Carrying value Ownership percentage Carrying value Ownership percentage AmerisourceBergen $ 3,965 25% $ 4,407 28% Others 1,811 8% - 50% 2,580 8% - 50% Total $ 5,777 $ 6,987 AmerisourceBergen investment On May 11, 2022, the Company sold 6.0 million shares of AmerisourceBergen common stock pursuant to Rule 144 at a price of $150 per share for a total consideration of $900 million, decreasing the Company's ownership of AmerisourceBergen’s common stock from 58,854,867 shares, held at August 31, 2021 to 52,854,867 shares held as of May 31, 2022. The transaction resulted in the Company recording a pre-tax gain of $424 million in Other income in the Consolidated Condensed Statements of Earnings, including a $25 million loss reclassified from within Accumulated other comprehensive income in the Consolidated Condensed Balance Sheets . As of May 31, 2022, the Company holds approximately 25.2% of AmerisourceBergen 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 in Operating income within the 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, 2022 and 2021, the Company recognized equity income of $330 million and equity losses of $1.2 billion in AmerisourceBergen, respectively. The equity losses for the period ended May 31, 2021 were primarily due to AmerisourceBergen's recognition of a loss of $5.6 billion, net of tax, related to its ongoing opioid litigation in its financial statements for the three months ended September 30, 2020. The Level 1 fair market value of the Company’s equity investment in AmerisourceBergen common stock at May 31, 2022 and August 31, 2021 was $8.2 billion and $7.2 billion, respectively. As of May 31, 2022 the carrying value of the Company’s investment in AmerisourceBergen exceeded its proportionate share of the net assets of AmerisourceBergen by $3.8 billion. This premium of $3.8 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. Other investments The Company’s other equity method investments primarily include its U.S. investments in Option Care Health, through its subsidiary HC Group Holdings I, LLC, and BrightSpring Health Services, and the Company’s investments in China in Sinopharm Medicine Holding Guoda Drugstores Co., Ltd, Guangzhou Pharmaceuticals Corporation, and Nanjing Pharmaceutical Company Limited. The Company recorded $5 million and $575 million of post-tax equity earnings from other equity method investments for the three months ended May 31, 2022 and 2021, respectively. The Company recorded $29 million and $604 million of post-tax equity earnings from other equity method investments for the nine months ended May 31, 2022 and 2021, respectively. During the three months ended February 28, 2022, the Company recognized an other-than-temporary impairment of $124 million related to an equity method investment in China. The impairment was derived using Level 3 inputs, including financial projections and market multiples of comparable companies. During the three months ended November 30, 2021, the Company acquired majority equity interests in VillageMD and Shields. The Company accounted for these acquisitions as business combinations resulting in the remeasurement of its previously held minority equity interests and convertible debt securities at fair value resulting in pre-tax gains of $2.2 billion and $402 million for VillageMD and Shields, respectively, recognized in Other income in the Consolidated Condensed Statements of Earnings. As a result of these transactions, the Company now consolidates VillageMD and Shields within the Walgreens Health segment in its financial statements. During the three and nine months ended May 31, 2021, the Company recorded gains of $98 million and $290 million, respectively, in Other income due to the partial sale of ownership interest in Option Care Health by the Company's then equity method investee HC Group Holdings I, LLC. During the three months ended May 31, 2021, as a result of these sales HC Group Holdings I, LLC 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 I, LLC recognized a gain of $1.2 billion and the Company recorded its share of equity earnings in HC Group Holdings I, LLC of $576 million 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, 2022 2021 2022 2021 Sales $ 65,085 $ 55,890 $ 200,628 $ 171,417 Gross Profit 3,308 2,558 10,117 7,647 Net earnings (loss) 602 489 1,474 (3,841) Share of earnings (loss) from equity method investments 132 672 359 (591) The summarized financial information for equity method investments has been included on an aggregated basis for all investments as reported for the three and nine months ended May 31, 2022 and 2021, respectively. |
Goodwill and other intangible a
Goodwill and other intangible assets | 9 Months Ended |
May 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets | Note 7. 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 as of the June 1, 2021 valuation date, the fair values of the Company’s reporting units exceeded their carrying amounts ranging from approximately 18% to approximately 195%. The Boots reporting unit's fair value was in excess of its carrying value by approximately 18%, compared to a nominal amount as of June 1, 2020. The Other international reporting unit's fair value was in excess of its carrying value by approximately 29%. As of May 31, 2022 and August 31, 2021, the carrying value of goodwill for the Boots reporting unit was $956 million and $1.1 billion, respectively. As of May 31, 2022 and August 31, 2021, the carrying value of goodwill for the Other international reporting unit was $372 million and $381 million, respectively. As of June 1, 2021, the fair values of indefinite-lived intangibles within the Boots reporting unit exceeded their carrying value amounts ranging from approximately 5% to approximately 27%. As of May 31, 2022 and August 31, 2021, the carrying value of the indefinite-lived intangibles within the Boots reporting unit was $6.7 billion and $7.3 billion, respectively. The determination of the fair value of the reporting units requires the Company to make significant estimates and assumptions 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 roll forward: United States International Walgreens Health Walgreens Boots Alliance, Inc. August 31, 2021 $ 10,947 $ 1,474 $ — $ 12,421 Acquisitions — — 9,586 9,586 Currency translation adjustments — (106) — (106) May 31, 2022 $ 10,947 $ 1,368 $ 9,586 $ 21,901 The carrying amount and accumulated amortization of intangible assets consist of the following (in millions): Intangible assets May 31, 2022 August 31, 2021 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 4,364 $ 3,522 Primary care provider network 1,244 — Trade names and trademarks 685 361 Developed technology 2 355 156 Purchasing and payor contracts 15 317 Others 2 78 65 Total gross amortizable intangible assets $ 6,741 $ 4,421 Accumulated amortization Customer relationships and loyalty card holders 1 $ 1,487 $ 1,335 Primary care provider network 43 — Trade names and trademarks 244 226 Developed technology 2 43 8 Purchasing and payor contracts 3 227 Others 2 33 29 Total accumulated amortization 1,853 1,826 Total amortizable intangible assets, net $ 4,888 $ 2,595 Indefinite-lived intangible assets Trade names and trademarks $ 4,835 $ 5,276 Pharmacy licenses 1,860 2,066 Total indefinite-lived intangible assets $ 6,695 $ 7,342 Total intangible assets, net $ 11,583 $ 9,936 1 Includes purchased prescription files. 2 Includes certain reclassifications to conform to the current period presentation. Amortization expense for intangible assets was $148 million and $488 million for the three and nine months ended May 31, 2022, respectively, and $156 million and $363 million for the three and nine months ended May 31, 2021, respectively. Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2022 is as follows (in millions): 2022 (Remaining period) 2023 2024 2025 2026 2027 Estimated annual amortization expense $ 151 $ 571 $ 551 $ 518 $ 497 $ 434 |
Debt
Debt | 9 Months Ended |
May 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Note 8. 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, 2022 August 31, 2021 Short-term debt Credit facilities Unsecured credit facility due 2023 1,998 — $8 billion note issuance 1 3.300% unsecured notes due 2021 2 — 1,250 $4 billion note issuance 4 3.100% unsecured notes due 2022 731 — Other 3 57 56 Total short-term debt $ 2,787 $ 1,305 Long-term debt Credit facilities Unsecured credit facility due 2023 $ 1,997 $ — Unsecured credit facility due 2024 998 — $850 million note issuance 1 0.9500% unsecured notes due 2023 848 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 497 4.100% unsecured notes due 2050 792 792 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,443 1,442 4.650% unsecured notes due 2046 318 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,154 1,154 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 868 868 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 374 408 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 790 873 $4 billion note issuance 4 3.100% unsecured notes due 2022 — 731 4.400% unsecured notes due 2042 263 263 Other 3 27 29 Total long-term debt, less current portion $ 10,670 $ 7,675 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. 2 On September 18, 2021, the Company redeemed in full the $1.25 billion aggregate principal amount outstanding of its 3.300% unsecured notes due 2021 issued by the Company on November 18, 2014. 3 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 4 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. On June 3, 2022, a notice of redemption was given to holders of the 3.100% notes due 2022. As a result, on July 5, 2022, the notes with aggregate principal amount of $731 million will be redeemed in full. See Note 20. Subsequent events for further information. $850 million Note issuance On November 17, 2021, the Company issued, in an underwritten public offering, $850 million of 0.95% notes due 2023. The notes contain a call option which allows for the notes to be repaid, in full or in part at 100% of the principal amount of the notes to be redeemed, in each case plus accrued and unpaid interest. Credit facilities November 15, 2021, Delayed Draw Term Loan On November 15, 2021, the Company entered into a $5.0 billion senior unsecured multi-tranche delayed draw term loan credit facility, (the “November 2021 DDTL”) consisting of (i) a 364-day senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the“364-day loan”), (ii) a two-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the “two-year loan”) and (iii) a three-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $1.0 billion (the “three-year loan”). An aggregate amount of $3.0 billion or more of the November 2021 DDTL is for the purpose of funding the consideration due in respect of the purchase of an increased equity stake in VillageMD, and paying fees and expenses related to the foregoing, and the remainder can be used for general corporate purposes. The maturity date on the 364-day loan, the two-year loan and the three-year loan is, in each case, the earlier of the date that is 364 days, two years and three years from the date of the first drawing under each facility and February 14, 2023, February 15, 2024 and February 15, 2025 respectively. As of May 31, 2022, there were $5 billion in borrowings outstanding under the November 2021 DDTL. Borrowings under the November 2021 DDTL bear interest at a fluctuating rate per annum equal to, at the Company’s option, the alternate base rate, eurocurrency rate or, from and after the date that daily Secured Overnight Financing Rate (“SOFR”) becomes available under the November 2021 DDTL, the daily SOFR rate, in each case, plus an applicable margin. For the 364-day tranche, the applicable margin is (i) prior to the six month anniversary of the Margin Trigger Date, as defined in the November 2021 DDTL (the “Margin Trigger Date”), 0.70% in the case of eurocurrency rate loans and daily SOFR loans, and 0.00% in the case of alternate base rate loans and (ii) on and after the six month anniversary of the Margin Trigger Date, 0.75% in the case of eurocurrency rate loans and daily SOFR loans, and 0.00% in the case of alternate base rate loans. For the 2-year and 3-year tranche, the applicable margin is 0.85% and 1.00%, respectively, in the case of eurocurrency rate loans and daily SOFR loans, and 0.00% in the case of alternate base rate loans. December 23, 2020, Revolving Credit Agreement On December 23, 2020, the Company entered into a $1.25 billion senior unsecured 364-day revolving credit facility 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 “2020 Revolving Credit Agreement”). 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, 2022, commitments under the 364-day facility had expired and there were no borrowings outstanding under the 18-month revolving credit facility. On June 17, 2022, the Company terminated the 2020 Revolving Credit Agreement. See Note 20. Subsequent events for further information. 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, 2022, there were no borrowings outstanding under the August 2018 Revolving Credit Agreement. On June 17, 2022, the Company terminated the August 2018 Revolving Credit Agreement. See Note 20. Subsequent events for further information. 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. As of May 31, 2022, the Company was in compliance with all such applicable 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 $1.2 billion and $2.3 billion at a weighted average interest rate of 0.55% and 0.47% for the nine months ended May 31, 2022 and 2021, 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 $418 million at a weighted average interest rate of 0.43% for the six months ended February 28, 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 $336 million and $889 million for the nine months ended May 31, 2022 and 2021, respectively. Interest paid for the nine months ended May 31, 2022 and 2021 included charges on early extinguishment of debt of $4 million and $387 million, respectively. |
Financial instruments
Financial instruments | 9 Months Ended |
May 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial instruments | Note 9. Financial instruments The Company uses derivative instruments to hedge its exposure to market risks, including interest rate and currency risks, arising from operating and financing 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, 2022 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 537 $ 21 Other current assets Cross currency interest rate swaps 150 5 Other current assets Cross currency interest rate swaps 750 39 Other non-current assets Foreign currency forwards 9 1 Other non-current assets Foreign currency forwards 189 3 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,070 $ 188 Other current assets Total return swap 232 7 Other current assets Foreign currency forwards 1,188 17 Other current liabilities August 31, 2021 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 575 $ 7 Other current assets Cross currency interest rate swaps 155 1 Other non-current assets Foreign currency forwards 6 — Other non-current assets Foreign currency forwards 31 1 Other current liabilities Cross currency interest rate swaps 109 9 Other current liabilities Cross currency interest rate swaps 801 23 Other non-current liabilities Foreign currency forwards 23 1 Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,636 $ 38 Other current assets Total return swap 224 2 Other current assets Foreign currency forwards 808 3 Other current liabilities Total return swap 37 — 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 Currency translation adjustments, a component of Accumulated other comprehensive income (loss) in the Consolidated Condensed Balance Sheets. 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 Unrealized gain (loss) on cash flow hedges, a component of Accumulated other comprehensive income (loss) in the Consolidated Condensed Balance Sheets, 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 (expense) 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 2022 2021 2022 2021 Foreign currency forwards Selling, general and administrative expenses 1 $ — $ (53) $ — $ (177) Total return swap Selling, general and administrative expenses (14) 20 (24) 48 Foreign currency forwards Other income 1 319 (5) 322 (6) 1. In the nine months ended May 31, 2022, certain expenses related to derivative instruments used as economic hedges, were presented as Other income within the Consolidated Condensed Statements of Earnings, whereas these expenses were recorded within Selling, general, and administrative expenses within the Consolidated Condensed Statements of Earnings in prior periods. 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, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Note 10. 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, 2022 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 2,173 $ 2,173 $ — $ — Foreign currency forwards 2 210 — 210 — Cross currency interest rate swaps 3 44 — 44 — Total return swaps 7 — 7 — Investments in equity securities 4 2 2 — — Liabilities : Foreign currency forwards 2 $ 20 $ — $ 20 $ — August 31, 2021 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 634 $ 634 $ — $ — Investments in debt securities 5 663 — — 663 Foreign currency forwards 2 46 — 46 — Cross currency interest rate swaps 3 1 — 1 — Total return swaps 2 — 2 — Investments in equity securities 4 2 2 — — Liabilities : Cross currency interest rate swaps 3 $ 32 $ — $ 32 $ — Foreign currency forwards 2 5 — 5 — 1. Money market funds are valued at the closing price reported by the fund sponsor. 2. 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. 3. The fair value of interest rate swaps and cross currency 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. 4. Fair values of quoted investments are based on current bid prices as of May 31, 2022 and August 31, 2021. 5. Level 3 debt securities include investments in convertible debt securities of VillageMD which are valued on a quarterly basis using the Probability Weighted Expect Return Method with gains or losses recorded in Other comprehensive income within the Consolidated Condensed Balance Sheets. Inputs include the enterprise value, expected holding term of the investment, volatility and risk-free interest rates. There were no transfers between Levels for the three and nine months ended May 31, 2022. The Company reports its debt instruments under the guidance of ASC Topic 825, Financial Instruments, which requires disclosure of the fair value of the Company’s debt in the footnotes to the Consolidated Condensed Financial Statements. As of May 31, 2022, the carrying amounts and estimated fair values of long-term notes outstanding including the current portion were $8.4 billion and $8.1 billion, respectively. The fair values of the notes outstanding are Level 1 fair value measures and determined based on quoted market prices and translated at the May 31, 2022 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, 2022. See Note 8. Debt, for further information. The carrying values of 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, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Note 11. Commitments and contingencies The Company is involved in legal proceedings arising in the normal course of its business, including litigation, arbitration and other claims, and investigations, inspections, subpoenas, audits, claims, inquiries and similar actions by governmental authorities in pharmacy, healthcare, tax and other areas. Some of these proceedings may be class actions, and some involve claims for large or indeterminate amounts, including punitive or exemplary damages, and they may remain unresolved for several years. Legal proceedings in general, and securities, class action and multi-district litigation, in particular, can be expensive and disruptive. 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. 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. The Company’s business, compliance and reporting practices are subject to intensive scrutiny under applicable regulation, including review or audit by regulatory authorities. As a result, the Company regularly is the subject of government actions of the types described herein. The Company also may be named from time to time in qui tam actions initiated by private parties. In such an action, a private party purports to act on behalf of federal or state governments, alleges that false claims have been submitted for payment by the government and may receive an award if its 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 its 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. 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 suspension or exclusion from participation in government programs. We describe below certain proceedings against the Company in which the amount of loss could be material. We accrue for legal claims when, and to the extent that, the amount or range of probable loss can be reasonably estimated. We believe we have meritorious defenses in each of these proceedings, and we intend to defend each case vigorously, but there can be no assurance as to the ultimate outcome. With respect to litigation and other legal proceedings where the Company has determined a material loss is reasonably possible, except as otherwise disclosed, we are not able to make a reasonable estimate of the amount or range of loss that is reasonably possible above any accrued amounts in these proceedings, due to various reasons, including: we have factual and legal arguments that, if successful, will eliminate or sharply reduce the possibility of loss; we do not have sufficient information about the arguments and the evidence plaintiffs will advance with respect to their damages; some of the cases have been stayed; certain proceedings present novel and complex questions of public policy; legal and factual determinations and judicial and governmental procedure; the large number of parties involved; and the inherent uncertainties related to such litigations. Litigation Relating to 2016 Goals 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. The Company’s motion to dismiss the 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. On November 2, 2021, the Court denied plaintiffs’ motion for summary judgment and granted in part and denied in part defendants’ cross motion. On March 2, 2022 the Court granted the Company’s motion to reconsider a portion of that ruling. On June 29, 2022 the Court granted preliminary approval of a settlement in the amount of $105 million which was fully accrued at May 31, 2022. Securities Claims Relating to Rite-Aid Merger 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. class action”) arising out of transactions contemplated by the merger agreement between the Company and Rite Aid. The amended complaint alleges 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, and the Court granted plaintiffs' motion for class certification. Fact and expert discovery have concluded and summary judgement briefing is complete. In October and December 2020, two separate purported Rite Aid Shareholders filed actions in the same court opting out of the class in the M.D. Pa. class action and making nearly identical allegations as those in the M.D. Pa. class action (the “Opt-out Actions”). The Opt-out Actions have been stayed until the earlier of (a) 30 days after the entry of an order resolving any pre-trial dispositive motions in the M.D. Pa. class action, or (b) 30 days after the entry of an order of final approval of any settlement of the M.D. Pa. class action. Claims Relating to Opioid Abuse The Company is among an array of defendants in multiple actions in federal courts alleging claims generally concerning the impacts of widespread opioid abuse, which have been commenced by various plaintiffs such as counties, cities, hospitals, Indian tribes, and others. In December 2017, the U.S. Judicial Panel on Multidistrict Litigation consolidated many of these cases in a consolidated multidistrict litigation, captioned In re National Prescription Opiate Litigation (MDL No. 2804, Case No. 17-md-2804), which is pending in the U.S. District Court for the Northern District of Ohio (“N.D. Ohio”). The Company is a defendant in the following multidistrict litigation (MDL) bellwether cases: • One case 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, is currently ongoing. • Two 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). In November 2021, the jury in that case returned a verdict after trial in favor of the plaintiffs as to liability, and the second trial regarding remedies took place in May 2022. The court has yet to determine how much each defendant will pay in damages. The Company is unable to predict the outcome relative to remedies or apportionment and believes it has very strong grounds for appeal. • One case 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), which has since been remanded to the District Court of Sequoyah County, Oklahoma (a decision that is on appeal). • Five additional bellwether cases designated in April 2021: (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. • 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. The Company also has been named as a defendant in numerous actions brought in state courts relating to opioid matters. Trial dates have been set in cases pending in state courts in the following states: • New Mexico ( State of New Mexico, ex rel. Hector Balderas, Attorney General v. Purdue Pharma L.P., et al. , Case No. D-101-cv-2017-02541, First Judicial District Court, Santa Fe County, New Mexico - September 2022). • West Virginia ( State of West Virginia, ex rel. Patrick Morrisey, Attorney General v. Walgreens Boots Alliance, Inc., et al., Civil Action No.20-C-82 PNM, Circuit Court of Kanawha County, West Virginia, - September 2022). • Michigan ( State of Michigan, ex rel. Dana Nessel, Attorney General v. Cardinal Health, Inc. , et al., Case No. 19-016896-NZ, Circuit Court for Wayne County, Michigan - February 2023). • Alabama ( Mobile County Board of Health, et al. v. Fisher, et al. , Case No. CV-2019-902806.00, Circuit Court of Mobile County, Alabama - scheduled for trial in January 2023, but currently stayed pending a petition to the Alabama Supreme Court); ( The DCH Health Care Authority, et al. v. Purdue Pharma LP, et al. , Case No. CV-2019-000007.00, Circuit Court of Conecuh County, Alabama - March 2023). • Nevada ( State of Nevada v. McKesson Corporation, et al. , Case No. A-19-796755-B, Eighth Judicial District Court, Clark County, Nevada - April 2023). • Missouri ( Jefferson County, Missouri v. Dannie E. Williams, M.D., et al. , Case No. 20JE-CC00029, Twenty-Third Judicial Circuit, Jefferson County, Missouri - July 2023). 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. Purdu e Pharma L.P., et al., Index No. 400008/2017, Supreme Court of the State of New York, Suffolk County, New York) were resolved as to the Company in June 2021. The relief sought by various plaintiffs in these matters includes compensatory, abatement, restitution and punitive damages, as well as injunctive relief. In connection with these matters, the Company has engaged an expanded number of parties regarding possible resolution. Significant uncertainties remain. Additionally, the Company has received from the U.S. Department of Justice and the Attorneys General of numerous states subpoenas, civil investigative demands, and other requests concerning opioid-related matters. The Company continues to communicate with the Department of Justice with respect to purported violations of the federal Controlled Substances Act and the federal False Claims Act in dispensing opioid prescriptions at certain Walgreens locations. On May 5, 2022, the Company announced that it had entered into a settlement agreement with the State of Florida to resolve all claims related to the distribution and dispensing of prescription opioid medications across the Company’s pharmacies in the State of Florida. This settlement agreement is not an admission of liability or wrong-doing and would resolve opioid lawsuits filed and future claims by the state and government subdivisions in the State of Florida. The estimated settlement amount of $683 million includes $620 million in remediation payments, which will be paid to the State of Florida in equal installments over 18 years, and applied by it to opioid remediation, as well as a one-time payment of $63 million for attorneys’ fees. The Company made the first annual settlement payment of $97.4 million into escrow on June 17, 2022. During the three months ended May 31, 2022, the Company recorded a $683 million liability associated with this settlement. The settlement accrual is reflected in the unaudited Consolidated Condensed Statement of Earnings within Selling, general and administrative expenses as part of the United States segment. The Company recorded $97.4 million and $585.6 million of the estimated settlement liability in Accrued expenses and other current liabilities, and Other non-current liabilities, respectively, in our Consolidated Condensed Balance Sheet. |
Income taxes
Income taxes | 9 Months Ended |
May 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Note 12. Income taxes The Company recognized a tax benefit from continuing operations for the three months ended May 31, 2022. The effective tax rate for the three months ended May 31, 2022 was not meaningful. The tax benefit is primarily driven by reduction of a valuation allowance on net deferred tax assets due to capital gains from the sale of AmerisourceBergen shares (see Note 6. Equity method investments), internal restructuring, and other anticipated gains, as well as the tax benefit related to the opioid settlement agreement with the State of Florida (see Note 11. Commitments and contingencies). The tax rate for the three months ended May 31, 2021 was an expense of 32.8% and 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 from continuing operations for the nine months ended May 31, 2022 was 4.3%, compared to 7.4% for the nine months ended May 31, 2021. The tax rate for the current period includes the discrete tax effect of lower tax expense on gains from consolidation of the Company’s investment in VillageMD and Shields (see Note 3. Acquisitions and other investments), discrete tax benefits recorded for the release of valuation allowance on net deferred tax assets resulting from capital gains derived from the sale of AmerisourceBergen shares (see Note 6. Equity method investments), internal restructuring, and other anticipated gains, as well as the tax benefit related to the opioid settlement agreement with the State of Florida (see Note 11. Commitments and contingencies). The effective tax rate for the prior period reflects the discrete tax effect of equity losses in AmerisourceBergen, partially offset by the tax effect on equity earnings of HC Group Holdings. Income taxes paid for the nine months ended May 31, 2022 and 2021 were $291 million and $305 million, respectively. |
Retirement benefits
Retirement benefits | 9 Months Ended |
May 31, 2022 | |
Retirement Benefits [Abstract] | |
Retirement benefits | Note 13. 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 2022 2021 2022 2021 Service costs Selling, general and administrative expenses $ 1 $ 2 $ 4 $ 4 Interest costs Other income 37 36 115 104 Expected returns on plan assets/other Other income (70) (85) (216) (248) Total net periodic pension income $ (32) $ (48) $ (97) $ (140) The Company made cash contributions to its defined benefit pension plans of $20 million for the nine months ended May 31, 2022, which primarily related to committed payments. The Company plans to contribute an additional $21 million to its defined benefit pension plans during the remainder of fiscal year 2022. 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 $58 million and $181 million for the three and nine months ended May 31, 2022, respectively, compared to an expense of $54 million and $166 million for the three and nine months ended May 31, 2021, respectively. The Company also has certain contract based defined contribution arrangements. The principal arrangement is based in the UK, to which both the Company and participating employees contribute. The Company recognized an expense of $21 million and $69 million for the three and nine months ended May 31, 2022, respectively, compared to an expense of $25 million and $77 million for the three and nine months ended May 31, 2021, respectively. |
Accumulated other comprehensive
Accumulated other comprehensive income (loss) | 9 Months Ended |
May 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive income (loss) | Note 14. 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, 2022 and 2021 (in millions): Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Share of OCI of equity method investments Cumulative currency translation adjustments Total Balance at February 28, 2022 $ (372) $ (9) $ (11) $ (154) $ (1,782) $ (2,328) Other comprehensive income (loss) before reclassification adjustments — 4 176 (48) (515) (383) Amounts reclassified from AOCI (5) 1 — 25 — 20 Tax benefit (provision) 1 (1) (40) 6 — (34) Net change in other comprehensive (loss) income (4) 4 135 (17) (515) (397) Balance at May 31, 2022 $ (376) $ (5) $ 124 $ (171) $ (2,297) $ (2,724) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency translation adjustments Total Balance at August 31, 2021 $ (359) $ (10) $ (35) $ 96 $ (29) $ (1,772) $ (2,109) Other comprehensive income (loss) before reclassification adjustments — 5 207 450 (213) (525) (77) Amounts reclassified from AOCI (16) 2 — (577) 25 — (566) Other (6) — — — — — (6) Tax benefit (provision) 5 (1) (48) 31 46 — 32 Net change in other comprehensive (loss) income (17) 6 159 (96) (143) (525) (616) Balance at May 31, 2022 $ (376) $ (5) $ 124 $ — $ (171) $ (2,297) $ (2,724) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency 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 (loss) income (1) 8 (23) 5 (4) 142 127 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency 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) |
Segment reporting
Segment reporting | 9 Months Ended |
May 31, 2022 | |
Segment Reporting [Abstract] | |
Segment reporting | Note 15. Segment reporting In conjunction with the launch of its new consumer-centric healthcare strategy, in fiscal year 2022, the Company announced the creation of a new operating segment, Walgreens Health. As a result, beginning in fiscal year 2022, the Company is now aligned into three reportable segments: United States, International and Walgreens Health. 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 specialty and home delivery 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 a 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. Walgreens Health The Company’s Walgreens Health segment, created at the beginning of fiscal year 2022, is a consumer-centric, technology-enabled healthcare business that engages consumers through a personalized, omni-channel experience across the care journey. Walgreens Health delivers improved health outcomes and lower costs for payors and providers by delivering care through owned and partnered assets. The Walgreens Health segment currently consists of a majority position in VillageMD, a leading, national provider of value-based primary care services; a majority position in Shields, a specialty pharmacy integrator and accelerator for hospitals; and the Walgreens Health organically-developed business that contracts with payors and providers to deliver clinical healthcare services to their members and members’ caregivers through both digital and physical channels. Selling, general and administrative costs for Walgreens Health for the three and nine months ended May 31, 2021 have been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. The results of operations for reportable segments include procurement benefits. Corporate-related overhead costs are not allocated to reportable segments and are reported in “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, 2022 2021 2022 2021 Sales: United States $ 26,695 $ 28,743 $ 82,394 $ 83,250 International 5,305 5,288 16,686 14,998 Walgreens Health 596 — 1,173 — Corporate and Other 1 1 — — — Walgreens Boots Alliance, Inc. $ 32,597 $ 34,030 $ 100,254 $ 98,247 Adjusted operating income: United States $ 966 $ 1,471 $ 4,243 $ 3,789 International 174 94 563 326 Walgreens Health (129) (17) (218) (31) Corporate and Other (56) (88) (198) (202) Walgreens Boots Alliance, Inc. $ 955 $ 1,459 $ 4,389 $ 3,881 1. Includes certain eliminations. The following table reconciles adjusted operating income to operating (loss) income (in millions): Three months ended May 31, Nine months ended May 31, 2022 2021 2022 2021 Adjusted operating income $ 955 $ 1,459 $ 4,389 $ 3,881 Adjustments to equity earnings (loss) in AmerisourceBergen (60) (48) (155) (1,575) Transformational cost management (185) (60) (458) (338) Acquisition-related amortization (201) (158) (616) (367) Certain legal and regulatory accruals and settlements (734) — (734) (60) LIFO provision (55) (51) (64) (85) Acquisition-related costs (40) (9) (155) (25) Operating (loss) income $ (320) $ 1,134 $ 2,209 $ 1,432 |
Sales
Sales | 9 Months Ended |
May 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Sales | Note 16. 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, 2022 2021 2022 2021 United States Pharmacy $ 19,656 $ 21,770 $ 60,581 $ 63,133 Retail 7,039 6,973 21,814 20,117 Total 26,695 28,743 82,394 83,250 International Pharmacy 901 958 2,876 2,791 Retail 1,618 1,455 5,294 4,618 Wholesale 2,786 2,875 8,516 7,588 Total 5,305 5,288 16,686 14,998 Walgreens Health 596 — 1,173 — Corporate and Other 1 1 — — — Walgreens Boots Alliance, Inc. $ 32,597 $ 34,030 $ 100,254 $ 98,247 1 Includes certain eliminations. See Note 19. Supplemental information for further information on receivables from contracts with customers. |
Related parties
Related parties | 9 Months Ended |
May 31, 2022 | |
Related Party Transactions [Abstract] | |
Related parties | Note 17. 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) were as follows: Three months ended May 31, Nine months ended May 31, 2022 2021 2022 2021 Purchases, net $ 15,439 $ 15,947 $ 46,293 $ 46,449 May 31, 2022 August 31, 2021 Trade accounts payable, net of Trade accounts receivable $ 7,322 $ 6,589 See Note 2. Discontinued operations for further information. On December 28, 2021, in accordance with the terms of the Unit Purchase Agreement, VillageMD settled the fully subscribed tender offer using cash proceeds provided by the Company. The Company purchased $1.9 billion of units in VillageMD for cash, from existing holders, including Mr. Steven Shulman, the lead director of VillageMD, who received proceeds of approximately $117 million in consideration for the tender of 287,781 units in VillageMD. See Note 3. Acquisitions and Other investments for further information. After giving effect to the tender offer, Mr. Shulman owns approximately 1.2% of outstanding equity interests of VillageMD. On January 27, 2022, pursuant to the terms and subject to the conditions set forth in the Unit Purchase Agreement, the Company appointed Mr. Shulman to the Company’s Board of Directors. |
New accounting pronouncements
New accounting pronouncements | 9 Months Ended |
May 31, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New accounting pronouncements | Note 1. 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. However, 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, 2021, as amended by Form 10-K/A for the fiscal year ended August 31, 2021 filed on November 24, 2021. 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 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, 2022 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, payor 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 June 1, 2021, the Company completed the 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 (“Disposal Group”) to AmerisourceBergen Corporation (“AmerisourceBergen”). The Disposal Group met the criteria to be reported as discontinued operations. Therefore, the operating results of the Disposal Group are reported as discontinued operations for all prior periods. Effective as of the first quarter of fiscal year 2022, the Company is aligned into three reportable segments: United States, International and Walgreens Health. Unless otherwise specified, disclosures in these Consolidated Condensed Financial Statements reflect continuing operations only. See Note 2. Discontinued operations and Note 15. Segment reporting 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. Note 18. New accounting pronouncements Adoption of new accounting pronouncements 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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 the above ASU to clarify certain optional expedients in Topic 848. The Company adopted the new standard effective September 1, 2021, and the adoption did not have a material impact on the Company’s results of operations, cash flows or financial position. New accounting pronouncements not yet adopted Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal year 2024). The Company is evaluating the effect of adopting this new accounting guidance. Disclosures by business entities about government assistance In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) – Disclosures by Business Entities about Government Assistance. This ASU requires disclosures that are expected to increase the transparency of transactions with a government accounted for by applying a grant or contribution accounting model by analogy, including (1) the types of transactions, (2) the accounting for those transactions, and (3) the effect of those transactions on an entity’s financial statements. This ASU is effective for annual periods beginning after December 15, 2021 (fiscal year 2023). The Company is evaluating the effect of adopting this new accounting guidance. |
Supplemental information
Supplemental information | 9 Months Ended |
May 31, 2022 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental information | Note 19. 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 $4.5 billion at May 31, 2022 and August 31, 2021, respectively. Other accounts receivable balances, which consist primarily of receivables from vendors and manufacturers, including receivables from AmerisourceBergen (see Note 17. Related parties), were $1.1 billion at both May 31, 2022 and August 31, 2021. 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, 2022 2021 2022 2021 Depreciation expense $ 331 $ 352 $ 1,014 $ 1,042 Intangible asset and other amortization 148 156 488 363 Total depreciation and amortization expense $ 478 $ 507 $ 1,502 $ 1,404 Accumulated depreciation and amortization on property, plant and equipment was $13.0 billion at May 31, 2022 and $13.1 billion at August 31, 2021. Restricted cash The Company is required to maintain cash deposits with certain banks which consist of cash deposits 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, marketable securities and restricted cash in the Consolidated Condensed Statements of Cash Flows (in millions): May 31, 2022 August 31, 2021 Cash and cash equivalents $ 2,285 $ 559 Marketable securities 2,173 634 Restricted cash (included in other current assets) 82 77 Cash, cash equivalents, marketable securities and restricted cash $ 4,541 $ 1,270 Redeemable non-controlling interest The following is a roll forward of the redeemable non-controlling interest in the Consolidated Condensed Balance Sheets (in millions): Redeemable non-controlling interest roll forward: Three months ended May 31, 2022 Nine months ended May 31, 2022 Opening balance $ 812 $ 319 Recognition upon acquisition of subsidiary 1 — 2,489 Acquisition of non-controlling interests 2 — (2,047) Redemption price adjustments 3 (22) 68 Net loss attributable to redeemable non-controlling interest (12) (45) Currency translation adjustments and other (3) (9) Balance at May 31, 2022 $ 775 $ 775 1. Nine months ended May 31, 2022, includes, $1.9 billion of redeemable non-controlling interest, representing the maximum purchase price to redeem non-controlling units in VillageMD for cash, and redeemable non-controlling interest in Shields. 2. Nine months ended May 31, 2022, includes, $1.9 billion paid to existing shareholders of VillageMD as part of the fully subscribed tender offer and the acquisition of the remaining 30% non-controlling equity interest in the pharmaceutical wholesale business in Germany. 3. Remeasurement of non-controlling interests, probable of redemption but not currently redeemable, to their redemption value, is recorded to Paid in capital in the Consolidated Condensed Balance Sheets. See Note 3. Acquisitions and other investments for further information. 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 17.4 million and 17.2 million weighted outstanding options to purchase common shares that were anti-dilutive and excluded from the earnings per share calculation for the three and nine months ending May 31, 2022, compared to 15.9 million and 17.1 million for the three and nine months ending May 31, 2021, respectively. Cash dividends declared per common share Cash dividends per common share declared were as follows: Quarter ended 2022 2021 November $ 0.4775 $ 0.4675 February $ 0.4775 $ 0.4675 May $ 0.4775 $ 0.4675 Total $ 1.4325 $ 1.4025 |
Subsequent events
Subsequent events | 9 Months Ended |
May 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 20. Subsequent events On June 17, 2022, the Company entered into a five-year $3.5 billion revolving credit agreement and an eighteen-month $1.5 billion revolving credit agreement with certain lenders and Wells Fargo Bank, National Association, as administrative agent. Borrowings under the credit agreements shall be denominated in U.S. dollars, Sterling, Euros, Yen or any other currency as specified in the credit agreements and will bear interest at a fluctuating rate per annum equal to a benchmark rate applicable to the currency composing such borrowing plus an applicable margin based on the rating of the Company’s corporate debt obligations. Voluntary prepayments of the loans and voluntary reductions of the unutilized portion of the commitments under these credit agreements is permissible, without penalty, subject to certain conditions pertaining to minimum notice and minimum reduction amounts. Simultaneously, with the entry into the credit agreements, the Company terminated the Revolving Credit Agreements dated December 23, 2020 and August 29, 2018. All outstanding obligations under those credit agreements have been paid and satisfied in full. On June 3, 2022, pursuant to the terms of the Indenture, dated as of July 17, 2008, between Walgreen Co. and Computershare Trust Company, N.A., as successor to Wells Fargo Bank, National Association, as trustee (the “Trustee”), a notice of redemption was given to holders of the 3.100% notes due 2022 (the “notes”) issued by the Company on September 13, 2012. As a result, on July 5, 2022 (the “redemption date”), the notes with aggregate principal amount of $731 million will be redeemed in full. The redemption price of the notes will be calculated as set forth in the Notice of Full Redemption delivered to noteholders on June 3, 2022. This report does not constitute a notice of redemption under the indenture. |
Accounting policies (Policies)
Accounting policies (Policies) | 9 Months Ended |
May 31, 2022 | |
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. However, 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, 2021, as amended by Form 10-K/A for the fiscal year ended August 31, 2021 filed on November 24, 2021. 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 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, 2022 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, payor 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 June 1, 2021, the Company completed the 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 (“Disposal Group”) to AmerisourceBergen Corporation (“AmerisourceBergen”). The Disposal Group met the criteria to be reported as discontinued operations. Therefore, the operating results of the Disposal Group are reported as discontinued operations for all prior periods. Effective as of the first quarter of fiscal year 2022, the Company is aligned into three reportable segments: United States, International and Walgreens Health. Unless otherwise specified, disclosures in these Consolidated Condensed Financial Statements reflect continuing operations only. See Note 2. Discontinued operations and Note 15. Segment reporting for further information. |
Adoption of new accounting pronouncements; New accounting pronouncements not yet adopted | Adoption of new accounting pronouncements 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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. The Company adopted the new standard effective September 1, 2021, and the adoption did not have any 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 the above ASU to clarify certain optional expedients in Topic 848. The Company adopted the new standard effective September 1, 2021, and the adoption did not have a material impact on the Company’s results of operations, cash flows or financial position. New accounting pronouncements not yet adopted Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal year 2024). The Company is evaluating the effect of adopting this new accounting guidance. Disclosures by business entities about government assistance In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) – Disclosures by Business Entities about Government Assistance. This ASU requires disclosures that are expected to increase the transparency of transactions with a government accounted for by applying a grant or contribution accounting model by analogy, including (1) the types of transactions, (2) the accounting for those transactions, and (3) the effect of those transactions on an entity’s financial statements. This ASU is effective for annual periods beginning after December 15, 2021 (fiscal year 2023). The Company is evaluating the effect of adopting this new accounting guidance. |
Discontinued operations (Tables
Discontinued operations (Tables) | 9 Months Ended |
May 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedules of Discontinued Operations | Results of discontinued operations for prior periods were as follows (in millions): Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 5,500 $ 16,070 Cost of sales 4,956 14,486 Gross profit 544 1,584 Selling, general and administrative expense 394 1,211 Operating income from discontinued operations 150 373 Other expense (2) (7) Interest expense, net (13) (23) Earnings before income tax – discontinued operations 135 342 Income tax provision 44 68 Post tax earnings from other equity method investments 4 15 Net earnings from discontinued operations $ 95 $ 289 Sales in prior periods from the Disposal Group to the Company's continuing operations are not eliminated and aggregate to (in millions): Three months ended May 31, 2021 Nine months ended May 31, 2021 Sales $ 471 $ 1,385 Cash flows from operating and investing activities for discontinued operations in prior periods are (in millions): Nine months ended May 31, 2021 Cash used for operating activities - discontinued operations $ (132) Cash used for investing activities - discontinued operations $ (58) |
Acquisitions and other invest_2
Acquisitions and other investments (Tables) | 9 Months Ended |
May 31, 2022 | |
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 purchase price $ 5,200 Less: purchase price for issuance of new preferred units at fair value 1 (2,300) Net consideration 2,900 Fair value of share-based compensation awards attributable to pre-combination services 2 683 Fair value of previously held equity and debt 3,211 Fair value of non-controlling interest 3,257 Total $ 10,051 Identifiable assets acquired and liabilities assumed: Tangible assets 1 $ 634 Intangible assets 1,621 Liabilities (245) Total identifiable net assets $ 2,010 Goodwill $ 8,041 1. Comprises cash consideration of $1.1 billion and a promissory note of $1.2 billion. This consideration was provided in exchange for the issuance of new preferred units by VillageMD. VillageMD’s tangible assets acquired exclude this $1.1 billion of cash and $1.2 billion promissory note receivable. 2. Primarily related to vested share-based compensation awards. 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: Cash consideration $ 969 Fair value of share-based compensation awards attributable to pre-combination services 13 Fair value of previously held equity interests 502 Fair value of non-controlling interests 589 Total $ 2,074 Identifiable assets acquired and liabilities assumed: Tangible assets $ 84 Intangible assets 1,060 Liabilities (528) Total identifiable net assets $ 616 Goodwill $ 1,457 |
Exit and disposal activities (T
Exit and disposal activities (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 and 2021 were as follows (in millions): Three months ended May 31, 2022 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 16 $ 3 $ — $ 18 Asset impairments 48 14 — 61 Employee severance and business transition costs 53 22 11 86 Information technology transformation and other exit costs 1 6 — 7 Total pre-tax exit and disposal charges $ 117 $ 45 $ 11 $ 173 Nine months ended May 31, 2022 United States International Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 107 $ 6 $ — $ 113 Asset impairments 64 42 — 105 Employee severance and business transition costs 110 32 25 166 Information technology transformation and other exit costs 3 18 — 20 Total pre-tax exit and disposal charges $ 283 $ 97 $ 25 $ 404 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 charges $ 172 $ 63 $ 44 $ 279 |
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, 2021 $ 17 $ — $ 77 $ 20 $ 114 Costs 113 105 166 20 404 Payments (60) — (145) (24) (229) Other (52) (105) (6) 2 (161) Balance at May 31, 2022 $ 18 $ — $ 92 $ 20 $ 129 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 August 31, 2021 Operating leases: Operating lease right-of-use assets $ 21,369 $ 21,893 Operating lease obligations - current 2,270 2,259 Operating lease obligations - non-current 21,550 22,153 Total operating lease obligations $ 23,820 $ 24,412 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 664 $ 725 Lease obligations included in: Accrued expenses and other liabilities 37 37 Other non-current liabilities 919 974 Total finance lease obligations $ 956 $ 1,010 |
Schedule of Supplemental Income Statement and Other Information | Supplemental Statement of Earnings information related to leases were as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of Earnings supplemental information: 2022 2021 2022 2021 Operating lease cost Fixed $ 811 $ 807 $ 2,431 $ 2,406 Variable 1 198 157 600 477 Finance lease cost Amortization $ 11 $ 11 $ 33 $ 33 Interest 13 13 38 39 Sublease income $ 24 $ 21 $ 76 $ 62 Impairment of right-of-use assets 11 8 82 23 Gain on sale-leaseback 2 175 85 410 273 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: 2022 2021 Cash paid for amounts included in the measurement of lease obligations: Operating cash outflows from operating leases $ 2,515 $ 2,562 Operating cash outflows from finance leases 35 36 Financing cash outflows from finance leases 32 31 Total $ 2,582 $ 2,629 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 1,380 $ 2,011 Finance leases 11 — Total $ 1,391 $ 2,011 Weighted average lease terms and discount rates for real estate leases were as follows: Weighted average terms and discount rates: May 31, 2022 August 31, 2021 Weighted average remaining lease term in years: Operating leases 10.0 10.3 Finance leases 19.2 20.2 Weighted average discount rate: Operating leases 4.77 % 4.77 % Finance leases 5.18 % 5.18 % |
Schedule of Aggregate Future Lease Payments Under Operating Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2022 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2022 (Remaining period) $ 22 $ 867 2023 88 3,399 2024 88 3,295 2025 87 3,185 2026 87 3,081 2027 87 2,977 Later 1,052 13,412 Total undiscounted minimum lease payments $ 1,510 $ 30,216 Less: Present value discount (554) (6,396) Lease liability $ 956 $ 23,820 |
Schedule of Aggregate Future Lease Payments Under Finance Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2022 were as follows (in millions): Future lease payments: Fiscal year Finance lease Operating lease 2022 (Remaining period) $ 22 $ 867 2023 88 3,399 2024 88 3,295 2025 87 3,185 2026 87 3,081 2027 87 2,977 Later 1,052 13,412 Total undiscounted minimum lease payments $ 1,510 $ 30,216 Less: Present value discount (554) (6,396) Lease liability $ 956 $ 23,820 |
Equity method investments (Tabl
Equity method investments (Tables) | 9 Months Ended |
May 31, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | Equity method investments were as follows (in millions, except percentages): May 31, 2022 August 31, 2021 Carrying value Ownership percentage Carrying value Ownership percentage AmerisourceBergen $ 3,965 25% $ 4,407 28% Others 1,811 8% - 50% 2,580 8% - 50% Total $ 5,777 $ 6,987 |
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, 2022 2021 2022 2021 Sales $ 65,085 $ 55,890 $ 200,628 $ 171,417 Gross Profit 3,308 2,558 10,117 7,647 Net earnings (loss) 602 489 1,474 (3,841) Share of earnings (loss) from equity method investments 132 672 359 (591) |
Goodwill and other intangible_2
Goodwill and other intangible assets (Tables) | 9 Months Ended |
May 31, 2022 | |
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 roll forward: United States International Walgreens Health Walgreens Boots Alliance, Inc. August 31, 2021 $ 10,947 $ 1,474 $ — $ 12,421 Acquisitions — — 9,586 9,586 Currency translation adjustments — (106) — (106) May 31, 2022 $ 10,947 $ 1,368 $ 9,586 $ 21,901 |
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, 2022 August 31, 2021 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 4,364 $ 3,522 Primary care provider network 1,244 — Trade names and trademarks 685 361 Developed technology 2 355 156 Purchasing and payor contracts 15 317 Others 2 78 65 Total gross amortizable intangible assets $ 6,741 $ 4,421 Accumulated amortization Customer relationships and loyalty card holders 1 $ 1,487 $ 1,335 Primary care provider network 43 — Trade names and trademarks 244 226 Developed technology 2 43 8 Purchasing and payor contracts 3 227 Others 2 33 29 Total accumulated amortization 1,853 1,826 Total amortizable intangible assets, net $ 4,888 $ 2,595 Indefinite-lived intangible assets Trade names and trademarks $ 4,835 $ 5,276 Pharmacy licenses 1,860 2,066 Total indefinite-lived intangible assets $ 6,695 $ 7,342 Total intangible assets, net $ 11,583 $ 9,936 1 Includes purchased prescription files. 2 Includes certain reclassifications to conform to the current period presentation. |
Schedule of Future Amortization Expense | Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2022 is as follows (in millions): 2022 (Remaining period) 2023 2024 2025 2026 2027 Estimated annual amortization expense $ 151 $ 571 $ 551 $ 518 $ 497 $ 434 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 August 31, 2021 Short-term debt Credit facilities Unsecured credit facility due 2023 1,998 — $8 billion note issuance 1 3.300% unsecured notes due 2021 2 — 1,250 $4 billion note issuance 4 3.100% unsecured notes due 2022 731 — Other 3 57 56 Total short-term debt $ 2,787 $ 1,305 Long-term debt Credit facilities Unsecured credit facility due 2023 $ 1,997 $ — Unsecured credit facility due 2024 998 — $850 million note issuance 1 0.9500% unsecured notes due 2023 848 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 497 4.100% unsecured notes due 2050 792 792 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,443 1,442 4.650% unsecured notes due 2046 318 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,154 1,154 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 868 868 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 374 408 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 790 873 $4 billion note issuance 4 3.100% unsecured notes due 2022 — 731 4.400% unsecured notes due 2042 263 263 Other 3 27 29 Total long-term debt, less current portion $ 10,670 $ 7,675 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. 2 On September 18, 2021, the Company redeemed in full the $1.25 billion aggregate principal amount outstanding of its 3.300% unsecured notes due 2021 issued by the Company on November 18, 2014. 3 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 4 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. On June 3, 2022, a notice of redemption was given to holders of the 3.100% notes due 2022. As a result, on July 5, 2022, the notes with aggregate principal amount of $731 million will be redeemed in full. See Note 20. Subsequent events |
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, 2022 August 31, 2021 Short-term debt Credit facilities Unsecured credit facility due 2023 1,998 — $8 billion note issuance 1 3.300% unsecured notes due 2021 2 — 1,250 $4 billion note issuance 4 3.100% unsecured notes due 2022 731 — Other 3 57 56 Total short-term debt $ 2,787 $ 1,305 Long-term debt Credit facilities Unsecured credit facility due 2023 $ 1,997 $ — Unsecured credit facility due 2024 998 — $850 million note issuance 1 0.9500% unsecured notes due 2023 848 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 497 4.100% unsecured notes due 2050 792 792 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,443 1,442 4.650% unsecured notes due 2046 318 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,154 1,154 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 868 868 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 374 408 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 790 873 $4 billion note issuance 4 3.100% unsecured notes due 2022 — 731 4.400% unsecured notes due 2042 263 263 Other 3 27 29 Total long-term debt, less current portion $ 10,670 $ 7,675 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. 2 On September 18, 2021, the Company redeemed in full the $1.25 billion aggregate principal amount outstanding of its 3.300% unsecured notes due 2021 issued by the Company on November 18, 2014. 3 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 4 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. On June 3, 2022, a notice of redemption was given to holders of the 3.100% notes due 2022. As a result, on July 5, 2022, the notes with aggregate principal amount of $731 million will be redeemed in full. See Note 20. Subsequent events |
Financial instruments (Tables)
Financial instruments (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 537 $ 21 Other current assets Cross currency interest rate swaps 150 5 Other current assets Cross currency interest rate swaps 750 39 Other non-current assets Foreign currency forwards 9 1 Other non-current assets Foreign currency forwards 189 3 Other current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,070 $ 188 Other current assets Total return swap 232 7 Other current assets Foreign currency forwards 1,188 17 Other current liabilities August 31, 2021 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 575 $ 7 Other current assets Cross currency interest rate swaps 155 1 Other non-current assets Foreign currency forwards 6 — Other non-current assets Foreign currency forwards 31 1 Other current liabilities Cross currency interest rate swaps 109 9 Other current liabilities Cross currency interest rate swaps 801 23 Other non-current liabilities Foreign currency forwards 23 1 Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,636 $ 38 Other current assets Total return swap 224 2 Other current assets Foreign currency forwards 808 3 Other current liabilities Total return swap 37 — Other current liabilities |
Gains and (Losses) due to Changes in Fair Value Recognized in Earnings | The income (expense) 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 2022 2021 2022 2021 Foreign currency forwards Selling, general and administrative expenses 1 $ — $ (53) $ — $ (177) Total return swap Selling, general and administrative expenses (14) 20 (24) 48 Foreign currency forwards Other income 1 319 (5) 322 (6) 1. In the nine months ended May 31, 2022, certain expenses related to derivative instruments used as economic hedges, were presented as Other income within the Consolidated Condensed Statements of Earnings, whereas these expenses were recorded within Selling, general, and administrative expenses within the Consolidated Condensed Statements of Earnings in prior periods. |
Fair value measurements (Tables
Fair value measurements (Tables) | 9 Months Ended |
May 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of 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, 2022 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 2,173 $ 2,173 $ — $ — Foreign currency forwards 2 210 — 210 — Cross currency interest rate swaps 3 44 — 44 — Total return swaps 7 — 7 — Investments in equity securities 4 2 2 — — Liabilities : Foreign currency forwards 2 $ 20 $ — $ 20 $ — August 31, 2021 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 634 $ 634 $ — $ — Investments in debt securities 5 663 — — 663 Foreign currency forwards 2 46 — 46 — Cross currency interest rate swaps 3 1 — 1 — Total return swaps 2 — 2 — Investments in equity securities 4 2 2 — — Liabilities : Cross currency interest rate swaps 3 $ 32 $ — $ 32 $ — Foreign currency forwards 2 5 — 5 — 1. Money market funds are valued at the closing price reported by the fund sponsor. 2. 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. 3. The fair value of interest rate swaps and cross currency 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. 4. Fair values of quoted investments are based on current bid prices as of May 31, 2022 and August 31, 2021. 5. Level 3 debt securities include investments in convertible debt securities of VillageMD which are valued on a quarterly basis using the Probability Weighted Expect Return Method with gains or losses recorded in Other comprehensive income within the Consolidated Condensed Balance Sheets. Inputs include the enterprise value, expected holding term of the investment, volatility and risk-free interest rates. |
Retirement benefits (Tables)
Retirement benefits (Tables) | 9 Months Ended |
May 31, 2022 | |
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 2022 2021 2022 2021 Service costs Selling, general and administrative expenses $ 1 $ 2 $ 4 $ 4 Interest costs Other income 37 36 115 104 Expected returns on plan assets/other Other income (70) (85) (216) (248) Total net periodic pension income $ (32) $ (48) $ (97) $ (140) |
Accumulated other comprehensi_2
Accumulated other comprehensive income (loss) (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 and 2021 (in millions): Pension/ post-retirement obligations Unrealized gain (loss) on cash flow hedges Net investment hedges Share of OCI of equity method investments Cumulative currency translation adjustments Total Balance at February 28, 2022 $ (372) $ (9) $ (11) $ (154) $ (1,782) $ (2,328) Other comprehensive income (loss) before reclassification adjustments — 4 176 (48) (515) (383) Amounts reclassified from AOCI (5) 1 — 25 — 20 Tax benefit (provision) 1 (1) (40) 6 — (34) Net change in other comprehensive (loss) income (4) 4 135 (17) (515) (397) Balance at May 31, 2022 $ (376) $ (5) $ 124 $ (171) $ (2,297) $ (2,724) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency translation adjustments Total Balance at August 31, 2021 $ (359) $ (10) $ (35) $ 96 $ (29) $ (1,772) $ (2,109) Other comprehensive income (loss) before reclassification adjustments — 5 207 450 (213) (525) (77) Amounts reclassified from AOCI (16) 2 — (577) 25 — (566) Other (6) — — — — — (6) Tax benefit (provision) 5 (1) (48) 31 46 — 32 Net change in other comprehensive (loss) income (17) 6 159 (96) (143) (525) (616) Balance at May 31, 2022 $ (376) $ (5) $ 124 $ — $ (171) $ (2,297) $ (2,724) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency 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 (loss) income (1) 8 (23) 5 (4) 142 127 Balance at May 31, 2021 $ (740) $ (10) $ (113) $ 5 $ 6 $ (2,327) $ (3,180) Pension/ post- Unrealized Net investment hedges Unrealized gain on available for sale securities Share of Cumulative currency 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) |
Segment reporting (Tables)
Segment reporting (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 2021 2022 2021 Sales: United States $ 26,695 $ 28,743 $ 82,394 $ 83,250 International 5,305 5,288 16,686 14,998 Walgreens Health 596 — 1,173 — Corporate and Other 1 1 — — — Walgreens Boots Alliance, Inc. $ 32,597 $ 34,030 $ 100,254 $ 98,247 Adjusted operating income: United States $ 966 $ 1,471 $ 4,243 $ 3,789 International 174 94 563 326 Walgreens Health (129) (17) (218) (31) Corporate and Other (56) (88) (198) (202) Walgreens Boots Alliance, Inc. $ 955 $ 1,459 $ 4,389 $ 3,881 1. Includes certain eliminations. The following table reconciles adjusted operating income to operating (loss) income (in millions): Three months ended May 31, Nine months ended May 31, 2022 2021 2022 2021 Adjusted operating income $ 955 $ 1,459 $ 4,389 $ 3,881 Adjustments to equity earnings (loss) in AmerisourceBergen (60) (48) (155) (1,575) Transformational cost management (185) (60) (458) (338) Acquisition-related amortization (201) (158) (616) (367) Certain legal and regulatory accruals and settlements (734) — (734) (60) LIFO provision (55) (51) (64) (85) Acquisition-related costs (40) (9) (155) (25) Operating (loss) income $ (320) $ 1,134 $ 2,209 $ 1,432 |
Sales (Tables)
Sales (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 2021 2022 2021 United States Pharmacy $ 19,656 $ 21,770 $ 60,581 $ 63,133 Retail 7,039 6,973 21,814 20,117 Total 26,695 28,743 82,394 83,250 International Pharmacy 901 958 2,876 2,791 Retail 1,618 1,455 5,294 4,618 Wholesale 2,786 2,875 8,516 7,588 Total 5,305 5,288 16,686 14,998 Walgreens Health 596 — 1,173 — Corporate and Other 1 1 — — — Walgreens Boots Alliance, Inc. $ 32,597 $ 34,030 $ 100,254 $ 98,247 1 Includes certain eliminations. |
Related parties (Tables)
Related parties (Tables) | 9 Months Ended |
May 31, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Related party transactions with AmerisourceBergen (in millions) were as follows: Three months ended May 31, Nine months ended May 31, 2022 2021 2022 2021 Purchases, net $ 15,439 $ 15,947 $ 46,293 $ 46,449 May 31, 2022 August 31, 2021 Trade accounts payable, net of Trade accounts receivable $ 7,322 $ 6,589 |
Supplemental information (Table
Supplemental information (Tables) | 9 Months Ended |
May 31, 2022 | |
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, 2022 2021 2022 2021 Depreciation expense $ 331 $ 352 $ 1,014 $ 1,042 Intangible asset and other amortization 148 156 488 363 Total depreciation and amortization expense $ 478 $ 507 $ 1,502 $ 1,404 |
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, marketable securities and restricted cash in the Consolidated Condensed Statements of Cash Flows (in millions): May 31, 2022 August 31, 2021 Cash and cash equivalents $ 2,285 $ 559 Marketable securities 2,173 634 Restricted cash (included in other current assets) 82 77 Cash, cash equivalents, marketable securities and restricted cash $ 4,541 $ 1,270 |
Schedule of Cash, Cash Equivalents, Marketable Securities and Restricted Cash | The following represents a reconciliation of cash and cash equivalents in the Consolidated Condensed Balance Sheets to total cash, cash equivalents, marketable securities and restricted cash in the Consolidated Condensed Statements of Cash Flows (in millions): May 31, 2022 August 31, 2021 Cash and cash equivalents $ 2,285 $ 559 Marketable securities 2,173 634 Restricted cash (included in other current assets) 82 77 Cash, cash equivalents, marketable securities and restricted cash $ 4,541 $ 1,270 |
Schedule of Redeemable Noncontrolling Interest | The following is a roll forward of the redeemable non-controlling interest in the Consolidated Condensed Balance Sheets (in millions): Redeemable non-controlling interest roll forward: Three months ended May 31, 2022 Nine months ended May 31, 2022 Opening balance $ 812 $ 319 Recognition upon acquisition of subsidiary 1 — 2,489 Acquisition of non-controlling interests 2 — (2,047) Redemption price adjustments 3 (22) 68 Net loss attributable to redeemable non-controlling interest (12) (45) Currency translation adjustments and other (3) (9) Balance at May 31, 2022 $ 775 $ 775 1. Nine months ended May 31, 2022, includes, $1.9 billion of redeemable non-controlling interest, representing the maximum purchase price to redeem non-controlling units in VillageMD for cash, and redeemable non-controlling interest in Shields. 2. Nine months ended May 31, 2022, includes, $1.9 billion paid to existing shareholders of VillageMD as part of the fully subscribed tender offer and the acquisition of the remaining 30% non-controlling equity interest in the pharmaceutical wholesale business in Germany. 3. Remeasurement of non-controlling interests, probable of redemption but not currently redeemable, to their redemption value, is recorded to Paid in capital in the Consolidated Condensed Balance Sheets. |
Schedule of Dividends Payable | Cash dividends per common share declared were as follows: Quarter ended 2022 2021 November $ 0.4775 $ 0.4675 February $ 0.4775 $ 0.4675 May $ 0.4775 $ 0.4675 Total $ 1.4325 $ 1.4025 |
Accounting policies (Details)
Accounting policies (Details) | 9 Months Ended |
May 31, 2022 segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 3 |
Discontinued operations - Narra
Discontinued operations - Narrative (Details) - Discontinued Operations, Disposed of by Sale - Alliance Healthcare - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
Jun. 01, 2021 | Feb. 28, 2022 | Aug. 31, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Consideration from disposal | $ 6,900 | ||
Cash received from disposal | $ 6,700 | ||
Shares issued as part of disposal (in shares) | 2 | ||
Receivable for purchase price consideration | $ 98 | ||
Working capital adjustments to receivable for purchase price consideration | $ 38 |
Discontinued operations - Sched
Discontinued operations - Schedules of Discontinued Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||||
Net earnings from discontinued operations | $ 0 | $ 95 | $ 0 | $ 289 |
Discontinued Operations, Disposed of by Sale | Alliance Healthcare | ||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||||
Sales | 5,500 | 16,070 | ||
Cost of sales | 4,956 | 14,486 | ||
Gross profit | 544 | 1,584 | ||
Selling, general and administrative expense | 394 | 1,211 | ||
Operating income from discontinued operations | 150 | 373 | ||
Other expense | (2) | (7) | ||
Interest expense, net | (13) | (23) | ||
Earnings before income tax – discontinued operations | 135 | 342 | ||
Income tax provision | 44 | 68 | ||
Post tax earnings from other equity method investments | 4 | 15 | ||
Net earnings from discontinued operations | 95 | 289 | ||
Disposal Group, Including Discontinued Operation, Additional Disclosures [Abstract] | ||||
Sales | 5,500 | 16,070 | ||
Net Cash Provided by (Used in) Discontinued Operations [Abstract] | ||||
Cash used for operating activities - discontinued operations | (132) | |||
Cash used for investing activities - discontinued operations | (58) | |||
Discontinued Operations, Disposed of by Sale | Alliance Healthcare | Continuing Operations | ||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||||
Sales | 471 | 1,385 | ||
Disposal Group, Including Discontinued Operation, Additional Disclosures [Abstract] | ||||
Sales | $ 471 | $ 1,385 |
Acquisitions and other invest_3
Acquisitions and other investments - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Nov. 24, 2021 | Oct. 29, 2021 | May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Nov. 23, 2021 | Oct. 28, 2021 | |
Business Acquisition [Line Items] | ||||||||
Gain on sale of equity method investment | $ 421 | $ 290 | ||||||
VillageMD | ||||||||
Business Acquisition [Line Items] | ||||||||
Outstanding equity interest percentage | 63% | 30% | ||||||
Purchase price | $ 5,200 | |||||||
Cash consideration, gross | 4,000 | |||||||
Promissory note | 1,200 | |||||||
Cash paid to existing stockholders | 2,900 | |||||||
Value of purchase tender offer | 1,900 | |||||||
Cash consideration for preferred units | $ 1,100 | |||||||
Gain on sale of equity method investment | $ 1,597 | |||||||
Pre-tax gain related to conversion of previously held investment in convertible debt securities | 577 | |||||||
Shields Health Solutions Parent, LLC | ||||||||
Business Acquisition [Line Items] | ||||||||
Outstanding equity interest percentage | 70% | 25% | ||||||
Cash consideration, subject to purchase price adjustments | $ 969 | |||||||
Other Acquisitions | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration, net | $ 36 | $ 19 | $ 153 | $ 85 |
Acquisitions and other invest_4
Acquisitions and other investments - Schedule of Purchase Price Allocation and Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Nov. 24, 2021 | Oct. 29, 2021 | May 31, 2022 | Aug. 31, 2021 |
Identifiable assets acquired and liabilities assumed: | ||||
Goodwill | $ 21,901 | $ 12,421 | ||
VillageMD | ||||
Purchase Price Allocation: | ||||
Total purchase price | $ 5,200 | |||
Less: purchase price for issuance of new preferred units at fair value | (2,300) | |||
Net consideration | 2,900 | |||
Fair value of share-based compensation awards attributable to pre-combination services | 683 | |||
Fair value of previously held equity interests | 3,211 | |||
Fair value of non-controlling interests | 3,257 | |||
Total | 10,051 | |||
Identifiable assets acquired and liabilities assumed: | ||||
Tangible assets | 634 | |||
Intangible assets | 1,621 | |||
Liabilities | (245) | |||
Total identifiable net assets | 2,010 | |||
Goodwill | 8,041 | |||
Cash consideration for preferred units | 1,100 | |||
Promissory note | $ 1,200 | |||
Shields Health Solutions Parent, LLC | ||||
Purchase Price Allocation: | ||||
Cash consideration | $ 969 | |||
Fair value of share-based compensation awards attributable to pre-combination services | 13 | |||
Fair value of previously held equity interests | 502 | |||
Fair value of non-controlling interests | 589 | |||
Total | 2,074 | |||
Identifiable assets acquired and liabilities assumed: | ||||
Tangible assets | 84 | |||
Intangible assets | 1,060 | |||
Liabilities | (528) | |||
Total identifiable net assets | 616 | |||
Goodwill | $ 1,457 |
Exit and disposal activities -
Exit and disposal activities - Narrative (Details) $ in Millions | 3 Months Ended | |||||||||
Oct. 12, 2021 USD ($) store | Oct. 11, 2021 store | Dec. 20, 2018 USD ($) | May 31, 2022 USD ($) | Feb. 28, 2022 USD ($) | Aug. 31, 2021 USD ($) | May 31, 2021 USD ($) | Feb. 28, 2021 USD ($) | Aug. 31, 2020 USD ($) | Sep. 01, 2019 USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||||||||
Cumulative effect adjustment to decrease retained earnings | $ (30,382) | $ (30,867) | $ (23,822) | $ (22,596) | $ (21,625) | $ (21,136) | ||||
Adoption of New Accounting Standards | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Cumulative effect adjustment to decrease retained earnings | 6 | |||||||||
Retained Earnings | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Cumulative effect adjustment to decrease retained earnings | (38,632) | $ (38,757) | $ (35,121) | $ (34,908) | $ (34,116) | (34,210) | ||||
Retained Earnings | Adoption of New Accounting Standards | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Cumulative effect adjustment to decrease retained earnings | $ 3 | |||||||||
Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Costs incurred | 1,700 | |||||||||
Transformational Cost Management Program | United Kingdom | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of stores expected to close | store | 150 | 200 | ||||||||
Transformational Cost Management Program | United States | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Number of stores expected to close | store | 150 | 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 | |||||||||
Lease Obligations and Other Real Estate Costs | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Costs incurred | 467 | |||||||||
Asset Impairments | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Costs incurred | 357 | |||||||||
Employee Severance and Business Transition Costs | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Costs incurred | 679 | |||||||||
Information Technology Transformation and Other Exit Costs | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Costs incurred | 183 | |||||||||
Minimum | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Expected annual cost savings of restructuring plan | $ 3,300 | $ 2,000 | 3,500 | |||||||
Expected cost | 3,600 | |||||||||
Minimum | Exit and Disposal Costs | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Expected cost | 3,300 | |||||||||
Maximum | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Expected cost | 3,900 | |||||||||
Maximum | Exit and Disposal Costs | Transformational Cost Management Program | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Expected cost | $ 3,600 |
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, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 173 | $ 44 | $ 404 | $ 279 |
Reportable segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 117 | 2 | 283 | 172 |
Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 45 | 27 | 97 | 63 |
Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 11 | 14 | 25 | 44 |
Lease obligations and other real estate costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 18 | 21 | 113 | 62 |
Lease obligations and other real estate costs | Reportable segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 16 | 15 | 107 | 56 |
Lease obligations and other real estate costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 3 | 6 | 6 | 6 |
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 | 61 | 14 | 105 | 19 |
Asset impairments | Reportable segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 48 | 5 | 64 | 9 |
Asset impairments | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 9 | 42 | 10 |
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 | 86 | (2) | 166 | 172 |
Employee severance and business transition costs | Reportable segments | United States | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 53 | (19) | 110 | 92 |
Employee severance and business transition costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 22 | 2 | 32 | 36 |
Employee severance and business transition costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 11 | 14 | 25 | 44 |
Information technology transformation and other exit costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 7 | 11 | 20 | 26 |
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 | 1 | 3 | 14 |
Information technology transformation and other exit costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 6 | 10 | 18 | 11 |
Information technology transformation and other exit costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 0 | $ 0 | $ 0 | $ 1 |
Exit and disposal activities _3
Exit and disposal activities - Restructuring Reserve Activity (Details) - Transformational Cost Management Program $ in Millions | 9 Months Ended |
May 31, 2022 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 114 |
Costs | 404 |
Payments | (229) |
Other | (161) |
Ending balance | 129 |
Lease obligations and other real estate costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 17 |
Costs | 113 |
Payments | (60) |
Other | (52) |
Ending balance | 18 |
Asset Impairments | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 0 |
Costs | 105 |
Payments | 0 |
Other | (105) |
Ending balance | 0 |
Employee severance and business transition costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 77 |
Costs | 166 |
Payments | (145) |
Other | (6) |
Ending balance | 92 |
Information technology transformation and other exit costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 20 |
Costs | 20 |
Payments | (24) |
Other | 2 |
Ending balance | $ 20 |
Leases - Narrative (Details)
Leases - Narrative (Details) | May 31, 2022 |
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, 2022 | Aug. 31, 2021 |
Operating Leases: | ||
Operating lease right-of-use assets | $ 21,369 | $ 21,893 |
Operating lease obligations - current | 2,270 | 2,259 |
Operating lease obligations - non-current | 21,550 | 22,153 |
Total operating lease obligations | 23,820 | 24,412 |
Finance leases: | ||
Property, plant and equipment, net | 664 | 725 |
Lease obligations included in: | ||
Accrued expenses and other liabilities | 37 | 37 |
Other non-current liabilities | 919 | 974 |
Total finance lease obligations | $ 956 | $ 1,010 |
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, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Operating lease cost | ||||
Fixed | $ 811 | $ 807 | $ 2,431 | $ 2,406 |
Variable | 198 | 157 | 600 | 477 |
Finance lease cost | ||||
Amortization | 11 | 11 | 33 | 33 |
Interest | 13 | 13 | 38 | 39 |
Sublease income | 24 | 21 | 76 | 62 |
Impairment of right-of-use assets | 11 | 8 | 82 | 23 |
Gain on sale-leaseback | $ 175 | $ 85 | $ 410 | $ 273 |
Leases - Other Supplemental Inf
Leases - Other Supplemental Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2022 | May 31, 2021 | |
Cash paid for amounts included in the measurement of lease obligations: | ||
Operating cash outflows from operating leases | $ 2,515 | $ 2,562 |
Operating cash outflows from finance leases | 35 | 36 |
Financing cash outflows from finance leases | 32 | 31 |
Total | 2,582 | 2,629 |
Right-of-use assets obtained in exchange for new lease obligations: | ||
Operating leases | 1,380 | 2,011 |
Finance leases | 11 | 0 |
Total | $ 1,391 | $ 2,011 |
Leases - Average Lease Terms An
Leases - Average Lease Terms And Discounts (Details) | May 31, 2022 | Aug. 31, 2021 |
Weighted average remaining lease term in years: | ||
Operating leases | 10 years | 10 years 3 months 18 days |
Finance leases | 19 years 2 months 12 days | 20 years 2 months 12 days |
Weighted average discount rate: | ||
Operating leases | 4.77% | 4.77% |
Finance leases | 5.18% | 5.18% |
Leases - Future Lease Payments
Leases - Future Lease Payments for Operating and Finance Leases (Details) - USD ($) $ in Millions | May 31, 2022 | Aug. 31, 2021 |
Finance lease | ||
2022 (Remaining period) | $ 22 | |
2023 | 88 | |
2024 | 88 | |
2025 | 87 | |
2026 | 87 | |
2027 | 87 | |
Later | 1,052 | |
Total undiscounted minimum lease payments | 1,510 | |
Less: Present value discount | (554) | |
Lease liability | 956 | $ 1,010 |
Operating lease | ||
2022 (Remaining period) | 867 | |
2023 | 3,399 | |
2024 | 3,295 | |
2025 | 3,185 | |
2026 | 3,081 | |
2027 | 2,977 | |
Later | 13,412 | |
Total undiscounted minimum lease payments | 30,216 | |
Less: Present value discount | (6,396) | |
Lease liability | $ 23,820 | $ 24,412 |
Equity method investments - Sch
Equity method investments - Schedule of Equity Method Investments (Details) - USD ($) $ in Millions | May 31, 2022 | Aug. 31, 2021 |
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 5,777 | $ 6,987 |
AmerisourceBergen | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 3,965 | $ 4,407 |
Ownership percentage | 25.20% | 28% |
Others | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 1,811 | $ 2,580 |
Others | Minimum | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 8% | 8% |
Others | Maximum | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 50% | 50% |
Total | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 5,777 | $ 6,987 |
Equity method investments - Nar
Equity method investments - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||||||
May 11, 2022 | May 31, 2022 | Feb. 28, 2022 | Nov. 30, 2021 | May 31, 2021 | Sep. 30, 2020 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | $ 421 | $ 290 | |||||||
Equity earnings (loss) | 359 | (577) | |||||||
Impairment of equity method investments and investments in debt and equity securities | 233 | 0 | |||||||
Share of OCI of equity method investments | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Loss associated with sale of equity method investment reclassified within accumulated other comprehensive income | $ 48 | $ (2) | $ 213 | (21) | |||||
AmerisourceBergen | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Number of share sold (in shares) | 6,000,000 | ||||||||
Share price of stock sold (in dollars per share) | $ 150 | ||||||||
Proceeds from sale of equity method investment | $ 900 | ||||||||
Outstanding shares owned (in shares) | 52,854,867 | 52,854,867 | 58,854,867 | ||||||
Gain on sale of equity method investment | 424 | ||||||||
Outstanding vested equity interest percentage | 25.20% | 25.20% | 28% | ||||||
Period of reporting lag | 2 months | ||||||||
Equity earnings (loss) | (1,200) | $ 330 | |||||||
Equity investment, exceeded its proportionate share of net assets | $ 3,800 | 3,800 | |||||||
AmerisourceBergen | Share of OCI of equity method investments | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Loss associated with sale of equity method investment reclassified within accumulated other comprehensive income | $ 25 | ||||||||
AmerisourceBergen | Opiod Litigation | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (loss) | $ (5,600) | ||||||||
AmerisourceBergen | Level 1 | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Fair market value of equity investment | 8,200 | 8,200 | $ 7,200 | ||||||
Other Investments | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Equity earnings (loss) | $ 5 | 575 | $ 29 | 604 | |||||
VillageMD | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | $ 2,200 | ||||||||
Shields Health Solutions Parent, LLC | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | $ 402 | ||||||||
Investments in China | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Impairment of equity method investments and investments in debt and equity securities | $ 124 | ||||||||
Option Care Health | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | 98 | 290 | |||||||
Equity earnings (loss) | $ 576 | ||||||||
Option Care Health | HC Group Holdings I, LLC | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Gain on sale of equity method investment | $ 1,200 |
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, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Income Statement [Abstract] | ||||
Sales | $ 32,597 | $ 34,030 | $ 100,254 | $ 98,247 |
Gross profit | 6,572 | 7,153 | 21,855 | 20,564 |
Net earnings (loss) | 229 | 1,173 | 4,566 | 1,899 |
Share of earnings (loss) from equity method investments | 132 | 672 | 359 | (591) |
Equity Method Investment | ||||
Income Statement [Abstract] | ||||
Sales | 65,085 | 55,890 | 200,628 | 171,417 |
Gross profit | 3,308 | 2,558 | 10,117 | 7,647 |
Net earnings (loss) | $ 602 | $ 489 | $ 1,474 | $ (3,841) |
Goodwill and other intangible_3
Goodwill and other intangible assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | Jun. 01, 2021 | |
Goodwill [Line Items] | ||||||
Goodwill | $ 21,901 | $ 21,901 | $ 12,421 | |||
Indefinite-lived intangible assets | 6,695 | 6,695 | 7,342 | |||
Amortization of intangible assets | 148 | $ 156 | 488 | $ 363 | ||
Minimum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 18% | |||||
Maximum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 195% | |||||
Other International Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 29% | |||||
Goodwill | 372 | 372 | 381 | |||
Boots Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 956 | 956 | 1,100 | |||
Indefinite-lived intangible assets | $ 6,700 | $ 6,700 | $ 7,300 | |||
Boots Reporting Unit | Minimum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 5% | |||||
Boots Reporting Unit | Maximum | ||||||
Goodwill [Line Items] | ||||||
Reporting unit fair value in excess of carrying amount (as a percent) | 27% |
Goodwill and other intangible_4
Goodwill and other intangible assets - Schedule of Goodwill (Details) $ in Millions | 9 Months Ended |
May 31, 2022 USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 12,421 |
Acquisitions | 9,586 |
Currency translation adjustments | (106) |
Goodwill, ending balance | 21,901 |
Reportable Segments | United States | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 10,947 |
Acquisitions | 0 |
Currency translation adjustments | 0 |
Goodwill, ending balance | 10,947 |
Reportable Segments | International | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 1,474 |
Acquisitions | 0 |
Currency translation adjustments | (106) |
Goodwill, ending balance | 1,368 |
Reportable Segments | Walgreens Health | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 0 |
Acquisitions | 9,586 |
Currency translation adjustments | 0 |
Goodwill, ending balance | $ 9,586 |
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, 2022 | Aug. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | $ 6,741 | $ 4,421 |
Accumulated amortization | 1,853 | 1,826 |
Total amortizable intangible assets, net | 4,888 | 2,595 |
Indefinite-lived intangible assets | 6,695 | 7,342 |
Total intangible assets, net | 11,583 | 9,936 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 4,835 | 5,276 |
Pharmacy licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 1,860 | 2,066 |
Customer relationships and loyalty card holders | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 4,364 | 3,522 |
Accumulated amortization | 1,487 | 1,335 |
Primary care provider network | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 1,244 | 0 |
Accumulated amortization | 43 | 0 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 685 | 361 |
Accumulated amortization | 244 | 226 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 355 | 156 |
Accumulated amortization | 43 | 8 |
Purchasing and payor contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 15 | 317 |
Accumulated amortization | 3 | 227 |
Others | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 78 | 65 |
Accumulated amortization | $ 33 | $ 29 |
Goodwill and other intangible_6
Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions | May 31, 2022 USD ($) |
Estimated annual intangible assets amortization expense [Abstract] | |
2022 (Remaining period) | $ 151 |
2023 | 571 |
2024 | 551 |
2025 | 518 |
2026 | 497 |
2027 | $ 434 |
Debt - Short and Long-Term Debt
Debt - Short and Long-Term Debt (Details) | Jul. 05, 2022 USD ($) | Jun. 03, 2022 | May 31, 2022 USD ($) | May 31, 2022 GBP (£) | May 31, 2022 EUR (€) | Nov. 17, 2021 USD ($) | Sep. 18, 2021 USD ($) | Aug. 31, 2021 USD ($) |
Debt Instrument [Line Items] | ||||||||
Total short-term debt | $ 2,787,000,000 | $ 1,305,000,000 | ||||||
Total long-term debt, less current portion | 10,670,000,000 | $ 7,675,000,000 | ||||||
3.300% unsecured notes due 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | 8,000,000,000 | |||||||
Stated interest rate | 3.30% | 3.30% | ||||||
Total short-term debt | 0 | $ 1,250,000,000 | ||||||
Debt redeemed | $ 1,250,000,000 | |||||||
3.100% unsecured notes due 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | 731,000,000 | 0 | ||||||
Unsecured credit facility due 2023 | Unsecured credit facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt | 1,997,000,000 | 0 | ||||||
Unsecured credit facility due 2024 | Unsecured credit facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt | 998,000,000 | 0 | ||||||
Other | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | 57,000,000 | 56,000,000 | ||||||
Unsecured notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Other | 27,000,000 | 29,000,000 | ||||||
Total long-term debt, less current portion | 10,670,000,000 | $ 7,675,000,000 | ||||||
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% | |||||||
Long-term debt | $ 0 | $ 731,000,000 | ||||||
Unsecured notes | 3.100% unsecured notes due 2022 | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.10% | |||||||
Unsecured notes | 3.100% unsecured notes due 2022 | Subsequent Event | Forecast | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt redeemed | $ 731,000,000 | |||||||
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 | 263,000,000 | ||||||
Unsecured notes | $850 million note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 850,000,000 | |||||||
Unsecured notes | 0.9500% unsecured notes due 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 850,000,000 | |||||||
Stated interest rate | 0.95% | 0.95% | 0.95% | 0.95% | ||||
Long-term debt | $ 848,000,000 | 0 | ||||||
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] | ||||||||
Stated interest rate | 3.20% | 3.20% | 3.20% | |||||
Long-term debt | $ 498,000,000 | 497,000,000 | ||||||
Unsecured notes | 4.100% unsecured notes due 2050 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 4.10% | 4.10% | 4.10% | |||||
Long-term debt | $ 792,000,000 | 792,000,000 | ||||||
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 | $ 1,443,000,000 | 1,442,000,000 | ||||||
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 | 318,000,000 | ||||||
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 | 1,154,000,000 | ||||||
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 | 301,000,000 | ||||||
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 | 868,000,000 | ||||||
Unsecured notes | Total £700 million note issuance | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | £ | £ 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 | $ 374,000,000 | 408,000,000 | ||||||
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 | $ 790,000,000 | 873,000,000 | ||||||
Unsecured credit facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Total short-term debt | $ 1,998,000,000 | $ 0 |
Debt - Narrative (Details)
Debt - Narrative (Details) £ in Millions | 9 Months Ended | |||||||
Nov. 17, 2021 USD ($) | Nov. 15, 2021 USD ($) | Dec. 23, 2020 USD ($) | May 31, 2022 USD ($) | May 31, 2021 USD ($) | May 31, 2021 GBP (£) | Aug. 31, 2021 USD ($) | Aug. 29, 2018 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Interest paid | $ 336,000,000 | $ 889,000,000 | ||||||
Charges for early debt extinguishment included in interest paid | $ 4,000,000 | 419,000,000 | ||||||
Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt to total capitalization ratio | 0.60 | |||||||
Commercial paper | ||||||||
Debt Instrument [Line Items] | ||||||||
Average daily short-term borrowings | $ 1,200,000,000 | $ 2,300,000,000 | ||||||
Weighted average interest rate | 0.55% | 0.47% | 0.47% | |||||
Commercial paper | Guarantor Subsidiaries | Reportable Legal Entities | ||||||||
Debt Instrument [Line Items] | ||||||||
Average daily short-term borrowings | $ 418,000,000 | £ 300 | ||||||
Weighted average interest rate | 0.43% | 0.43% | ||||||
Unsecured Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Charges for early debt extinguishment included in interest paid | $ 4,000,000 | $ 387,000,000 | ||||||
Unsecured Notes | 0.9500% Unsecured Notes due 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 850,000,000 | |||||||
Stated interest rate | 0.95% | 0.95% | ||||||
Redemption percentage | 100% | |||||||
Amount outstanding | $ 848,000,000 | $ 0 | ||||||
Unsecured credit facility | Delayed Draw Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 5,000,000,000 | |||||||
Unsecured credit facility | Delayed Draw Term Loan | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount outstanding | $ 5,000,000,000 | |||||||
Unsecured credit facility | Delayed Draw Term Loan Credit Facility, 364-Day Facility | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 2,000,000,000 | |||||||
Debt term | 364 days | |||||||
Unsecured credit facility | Delayed Draw Term Loan Credit Facility, 364-Day Facility | Term Loan | Euro Currency rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0.70% | |||||||
Unsecured credit facility | Delayed Draw Term Loan Credit Facility, 364-Day Facility | Term Loan | Alternative Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0% | |||||||
Unsecured credit facility | Delayed Draw Term Loan Credit Facility, 364-Day Facility, Tranche Two | Term Loan | Euro Currency rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0.75% | |||||||
Unsecured credit facility | Delayed Draw Term Loan Credit Facility, 364-Day Facility, Tranche Two | Term Loan | SOFR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0% | |||||||
Unsecured credit facility | 2020 Revolving Credit Agreement, 364-Day Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 364 days | |||||||
Maximum borrowing capacity | $ 1,250,000,000 | |||||||
Unsecured credit facility | 2020 Revolving Credit Agreement, 18-Month Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 18 months | |||||||
Maximum borrowing capacity | $ 2,250,000,000 | |||||||
Unsecured credit facility | August 2018 Revolving Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 3,500,000,000 | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 3,000,000,000 | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan Credit Facility, Two-Year Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 2,000,000,000 | |||||||
Debt term | 2 years | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan Credit Facility, Two-Year Facility | Euro Currency rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0.85% | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan Credit Facility, Two-Year Facility | Alternative Base Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 0% | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan Credit Facility, Three-Year Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,000,000,000 | |||||||
Debt term | 3 years | |||||||
Unsecured credit facility | Term Loan | Delayed Draw Term Loan Credit Facility, Three-Year Facility | SOFR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt margin rate | 1% | |||||||
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, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
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 | $ 0 | $ (53) | $ 0 | $ (177) | |
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 | 319 | (5) | 322 | (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 | (14) | $ 20 | (24) | $ 48 | |
Other current assets | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 537 | 537 | $ 575 | ||
Fair value, assets | 21 | 21 | 7 | ||
Other current assets | Foreign currency forwards | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 3,070 | 3,070 | 3,636 | ||
Fair value, assets | 188 | 188 | 38 | ||
Other current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 150 | 150 | |||
Fair value, assets | 5 | 5 | |||
Other current assets | Total return swap | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 232 | 232 | 224 | ||
Fair value, assets | 7 | 7 | 2 | ||
Other non-current assets | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 9 | 9 | 6 | ||
Fair value, assets | 1 | 1 | 0 | ||
Other non-current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, assets | 750 | 750 | 155 | ||
Fair value, assets | 39 | 39 | 1 | ||
Other current liabilities | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 189 | 189 | 31 | ||
Fair value, liabilities | 3 | 3 | 1 | ||
Other current liabilities | Foreign currency forwards | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 1,188 | 1,188 | 808 | ||
Fair value, liabilities | $ 17 | $ 17 | 3 | ||
Other current liabilities | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 109 | ||||
Fair value, liabilities | 9 | ||||
Other current liabilities | Total return swap | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 37 | ||||
Fair value, liabilities | 0 | ||||
Other non-current liabilities | Foreign currency forwards | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 23 | ||||
Fair value, liabilities | 1 | ||||
Other non-current liabilities | Cross currency interest rate swaps | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount, liabilities | 801 | ||||
Fair value, liabilities | $ 23 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Millions | May 31, 2022 | Aug. 31, 2021 |
Recurring | ||
Assets [Abstract] | ||
Money market funds | $ 2,173 | $ 634 |
Investments in debt securities | 663 | |
Investments in equity securities | 2 | 2 |
Recurring | Level 1 | ||
Assets [Abstract] | ||
Money market funds | 2,173 | 634 |
Investments in debt securities | 0 | |
Investments in equity securities | 2 | 2 |
Recurring | Level 2 | ||
Assets [Abstract] | ||
Money market funds | 0 | 0 |
Investments in debt securities | 0 | |
Investments in equity securities | 0 | 0 |
Recurring | Level 3 | ||
Assets [Abstract] | ||
Money market funds | 0 | 0 |
Investments in debt securities | 663 | |
Investments in equity securities | 0 | 0 |
Recurring | Foreign currency forwards | ||
Assets [Abstract] | ||
Derivative asset | 210 | 46 |
Liabilities [Abstract] | ||
Derivative liability | 20 | 5 |
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 | 210 | 46 |
Liabilities [Abstract] | ||
Derivative liability | 20 | 5 |
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 | 44 | 1 |
Liabilities [Abstract] | ||
Derivative liability | 32 | |
Recurring | Cross currency interest rate swaps | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liability | 0 | |
Recurring | Cross currency interest rate swaps | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 44 | 1 |
Liabilities [Abstract] | ||
Derivative liability | 32 | |
Recurring | Cross currency interest rate swaps | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liability | 0 | |
Recurring | Total return swap | ||
Assets [Abstract] | ||
Derivative asset | 7 | 2 |
Recurring | Total return swap | Level 1 | ||
Assets [Abstract] | ||
Derivative asset | 0 | 0 |
Recurring | Total return swap | Level 2 | ||
Assets [Abstract] | ||
Derivative asset | 7 | 2 |
Recurring | Total return swap | Level 3 | ||
Assets [Abstract] | ||
Derivative asset | 0 | $ 0 |
Carrying Value | ||
Liabilities [Abstract] | ||
Fair value of long-term notes outstanding | 8,400 | |
Estimate of Fair Value Measurement | ||
Liabilities [Abstract] | ||
Carrying value of long-term notes outstanding | $ 8,100 |
Commitments and contingencies (
Commitments and contingencies (Details) $ in Millions | Jun. 17, 2022 USD ($) | May 05, 2022 USD ($) | May 31, 2022 USD ($) case | Jun. 30, 2021 case |
Washtenaw County Employees’ Retirement System v. Walgreen Co. et al. | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Estimated settlement amount, liability | $ | $ 105 | |||
City and Cnty. of San Francisco, et al. v. Purdue Pharma L.P., et al. | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 1 | |||
Cnty. of Lake, Ohio v. Purdue Pharma L.P., et al. | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 2 | |||
The Cherokee Nation v. McKesson Corp., et al. | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 1 | |||
Bellweather Litigation Cases | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 5 | |||
Consolidated Cases in N.D. Ohio | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 2 | |||
Consolidated Cases in New York State Court | ||||
Loss Contingencies [Line Items] | ||||
Number of litigation cases outstanding | case | 2 | |||
Consolidated Cases in State of Florida | Pending Litigation | ||||
Loss Contingencies [Line Items] | ||||
Estimated settlement amount, liability | $ | $ 683 | |||
Estimated settlement amount | $ | 683 | |||
Estimated settlement amount, noncurrent liability | $ | $ 620 | $ 585.6 | ||
Settlement period | 18 years | |||
Estimated settlement amount, current liability | $ | $ 63 | $ 97.4 | ||
Consolidated Cases in State of Florida | Pending Litigation | Subsequent Event | ||||
Loss Contingencies [Line Items] | ||||
Payments for legal settlements | $ | $ 97.4 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Income Tax Examination [Line Items] | |||
Effective tax rate | 32.80% | 4.30% | 7.40% |
Equity earnings | $ 359 | $ (577) | |
Income taxes paid | $ 291 | $ 305 | |
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, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Components of net periodic benefit costs [Abstract] | ||||
Total net periodic pension income | $ (32) | $ (48) | $ (97) | $ (140) |
Employer cash contributions to defined benefit pension plans | 20 | |||
Expected employer cash contributions to defined benefit plan in current fiscal year | 21 | 21 | ||
Selling, general and administrative expenses | ||||
Components of net periodic benefit costs [Abstract] | ||||
Service costs | 1 | 2 | 4 | 4 |
Other income (expense) | ||||
Components of net periodic benefit costs [Abstract] | ||||
Interest costs | 37 | 36 | 115 | 104 |
Expected returns on plan assets/other | (70) | (85) | (216) | (248) |
United States | ||||
Components of net periodic benefit costs [Abstract] | ||||
Profit sharing provision expense | 58 | 54 | 181 | 166 |
Foreign Plan | ||||
Components of net periodic benefit costs [Abstract] | ||||
Cost recognized in the consolidated condensed statements of earnings | $ 21 | $ 25 | $ 69 | $ 77 |
Accumulated other comprehensi_3
Accumulated other comprehensive income (loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 30,867 | $ 21,625 | $ 23,822 | $ 21,136 |
Total other comprehensive (loss) income, net | (416) | 131 | (637) | 607 |
Ending balance | 30,382 | 22,596 | 30,382 | 22,596 |
Pension/ post-retirement obligations | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (372) | (739) | (359) | (748) |
Other comprehensive income (loss) before reclassification adjustments | 0 | 0 | 0 | 16 |
Amounts reclassified from AOCI | (5) | (2) | (16) | (6) |
Other | (6) | |||
Tax benefit (provision) | 1 | 0 | 5 | (3) |
Total other comprehensive (loss) income, net | (4) | (1) | (17) | 8 |
Ending balance | (376) | (740) | (376) | (740) |
Unrealized gain (loss) on cash flow hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (9) | (18) | (10) | (31) |
Other comprehensive income (loss) before reclassification adjustments | 4 | (3) | 5 | 11 |
Amounts reclassified from AOCI | 1 | 14 | 2 | 16 |
Other | 0 | |||
Tax benefit (provision) | (1) | (3) | (1) | (7) |
Total other comprehensive (loss) income, net | 4 | 8 | 6 | 21 |
Ending balance | (5) | (10) | (5) | (10) |
Net investment hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (11) | (90) | (35) | (34) |
Other comprehensive income (loss) before reclassification adjustments | 176 | (30) | 207 | (110) |
Amounts reclassified from AOCI | 0 | 0 | 0 | 0 |
Other | 0 | |||
Tax benefit (provision) | (40) | 7 | (48) | 31 |
Total other comprehensive (loss) income, net | 135 | (23) | 159 | (79) |
Ending balance | 124 | (113) | 124 | (113) |
Unrealized gain on available for sale securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | 96 | 0 | |
Other comprehensive income (loss) before reclassification adjustments | 5 | 450 | 5 | |
Amounts reclassified from AOCI | 0 | (577) | 0 | |
Other | 0 | |||
Tax benefit (provision) | 0 | 31 | 0 | |
Total other comprehensive (loss) income, net | 5 | (96) | 5 | |
Ending balance | 0 | 5 | 0 | 5 |
Share of OCI of equity method investments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (154) | 10 | (29) | (10) |
Other comprehensive income (loss) before reclassification adjustments | (48) | 2 | (213) | 21 |
Amounts reclassified from AOCI | 25 | 0 | 25 | 0 |
Other | 0 | |||
Tax benefit (provision) | 6 | (6) | 46 | (5) |
Total other comprehensive (loss) income, net | (17) | (4) | (143) | 16 |
Ending balance | (171) | 6 | (171) | 6 |
Cumulative currency translation adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (1,782) | (2,469) | (1,772) | (2,948) |
Other comprehensive income (loss) before reclassification adjustments | (515) | 141 | (525) | 615 |
Amounts reclassified from AOCI | 0 | 1 | 0 | 6 |
Other | 0 | |||
Tax benefit (provision) | 0 | 0 | 0 | 0 |
Total other comprehensive (loss) income, net | (515) | 142 | (525) | 621 |
Ending balance | (2,297) | (2,327) | (2,297) | (2,327) |
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (2,328) | (3,306) | (2,109) | (3,771) |
Other comprehensive income (loss) before reclassification adjustments | (383) | 115 | (77) | 558 |
Amounts reclassified from AOCI | 20 | 13 | (566) | 17 |
Other | (6) | |||
Tax benefit (provision) | (34) | (1) | 32 | 17 |
Total other comprehensive (loss) income, net | (397) | 127 | (616) | 591 |
Ending balance | $ (2,724) | $ (3,180) | $ (2,724) | $ (3,180) |
Segment reporting (Details)
Segment reporting (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 USD ($) | May 31, 2021 USD ($) | May 31, 2022 USD ($) segment | May 31, 2021 USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 3 | |||
Segment Reporting Information [Line Items] | ||||
Sales | $ 32,597 | $ 34,030 | $ 100,254 | $ 98,247 |
Adjusted operating income | 955 | 1,459 | 4,389 | 3,881 |
Adjustments to equity earnings (loss) in AmerisourceBergen | (60) | (48) | (155) | (1,575) |
Transformational cost management | (185) | (60) | (458) | (338) |
Acquisition-related amortization | (201) | (158) | (616) | (367) |
Certain legal and regulatory accruals and settlements | (734) | 0 | (734) | (60) |
LIFO provision | (55) | (51) | (64) | (85) |
Acquisition-related costs | (40) | (9) | (155) | (25) |
Operating (loss) income | (320) | 1,134 | 2,209 | 1,432 |
Reportable Segments | United States | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 26,695 | 28,743 | 82,394 | 83,250 |
Adjusted operating income | 966 | 1,471 | 4,243 | 3,789 |
Reportable Segments | International | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 5,305 | 5,288 | 16,686 | 14,998 |
Adjusted operating income | 174 | 94 | 563 | 326 |
Reportable Segments | Walgreens Health | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 596 | 0 | 1,173 | 0 |
Adjusted operating income | (129) | (17) | (218) | (31) |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 1 | 0 | 0 | 0 |
Adjusted operating income | $ (56) | $ (88) | $ (198) | $ (202) |
Sales (Details)
Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 32,597 | $ 34,030 | $ 100,254 | $ 98,247 |
Reportable Segments | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 26,695 | 28,743 | 82,394 | 83,250 |
Reportable Segments | United States | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 19,656 | 21,770 | 60,581 | 63,133 |
Reportable Segments | United States | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 7,039 | 6,973 | 21,814 | 20,117 |
Reportable Segments | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 5,305 | 5,288 | 16,686 | 14,998 |
Reportable Segments | International | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 901 | 958 | 2,876 | 2,791 |
Reportable Segments | International | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 1,618 | 1,455 | 5,294 | 4,618 |
Reportable Segments | International | Wholesale | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 2,786 | 2,875 | 8,516 | 7,588 |
Reportable Segments | Walgreens Health | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 596 | 0 | 1,173 | 0 |
Corporate and Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 1 | $ 0 | $ 0 | $ 0 |
Related parties - Schedule of R
Related parties - Schedule of Related Parties (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Related Party Transactions [Abstract] | |||||
Purchases, net | $ 15,439 | $ 15,947 | $ 46,293 | $ 46,449 | |
Trade accounts payable, net of Trade accounts receivable | $ 7,322 | $ 7,322 | $ 6,589 |
Related parties - Narrative (De
Related parties - Narrative (Details) - USD ($) $ in Millions | Dec. 28, 2021 | Nov. 24, 2021 |
Affiliated Entity | Steve Shulman | VillageMD | ||
Related Party Transaction [Line Items] | ||
Percentage of outstanding shares owned | 1.20% | |
VillageMD | ||
Related Party Transaction [Line Items] | ||
Value of purchase tender offer | $ 1,900 | |
VillageMD | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Value of purchase tender offer | $ 1,900 | |
Payments for stock consideration | $ 117 | |
Number of shares tendered (in shares) | 287,781 |
Supplemental information - Narr
Supplemental information - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Feb. 28, 2022 | Aug. 31, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Accounts receivable from related party | $ 1,100 | $ 1,100 | ||||
Accumulated depreciation and amortization on property, plant, and equipment | 13,000 | 13,000 | $ 13,100 | |||
Redeemable non-controlling interest | $ 775 | $ 775 | $ 812 | 319 | ||
Antidilutive securities excluded from EPS calculations (in shares) | 17.4 | 15.9 | 17.2 | 17.1 | ||
Trade Accounts Receivable | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Receivables | $ 3,900 | $ 3,900 | $ 4,500 |
Supplemental information - Depr
Supplemental information - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | ||||
Depreciation expense | $ 331 | $ 352 | $ 1,014 | $ 1,042 |
Intangible asset and other amortization | 148 | 156 | 488 | 363 |
Total depreciation and amortization expense | $ 478 | $ 507 | $ 1,502 | $ 1,404 |
Supplemental information - Summ
Supplemental information - Summary of Cash, Cash Equivalents, Marketable Securities and Restricted Cash (Details) - USD ($) $ in Millions | May 31, 2022 | Aug. 31, 2021 | May 31, 2021 | Aug. 31, 2020 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 2,285 | $ 559 | ||
Marketable securities | 2,173 | 634 | ||
Restricted cash (included in other current assets) | 82 | 77 | ||
Cash, cash equivalents, marketable securities and restricted cash | $ 4,541 | $ 1,270 | $ 1,803 | $ 746 |
Supplemental information - Sche
Supplemental information - Schedule of Redeemable Non-controlling Interest (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2022 | May 31, 2022 | Jan. 31, 2022 | Nov. 24, 2021 | Nov. 23, 2021 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Beginning balance | $ 812 | $ 319 | |||
Recognition upon acquisition of subsidiary | 0 | 2,489 | |||
Acquisition of non-controlling interests | 0 | (2,047) | |||
Redemption price adjustments | (22) | ||||
Redemption price adjustments | 68 | ||||
Net loss attributable to redeemable noncontrolling interest | (12) | (45) | |||
Currency translation adjustments and other | (3) | (9) | |||
Ending balance | $ 775 | 775 | |||
VillageMD | |||||
Conversion of Stock [Line Items] | |||||
Acquisition of additional interest in subsidiary | $ 1,900 | ||||
Outstanding equity interest percentage | 63% | 30% | |||
McKesson Corporation | |||||
Conversion of Stock [Line Items] | |||||
Outstanding equity interest percentage | 30% |
Supplemental information - Su_2
Supplemental information - Summary of Dividends per Share (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||||||
May 31, 2022 | Feb. 28, 2022 | Nov. 30, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | May 31, 2022 | May 31, 2021 | |
Cash and Cash Equivalents [Abstract] | ||||||||
Cash dividends declared (in dollars per share) | $ 0.4775 | $ 0.4775 | $ 0.4775 | $ 0.4675 | $ 0.4675 | $ 0.4675 | $ 1.4325 | $ 1.4025 |
Subsequent events (Details)
Subsequent events (Details) - USD ($) | Jun. 17, 2022 | Jul. 05, 2022 | Jun. 03, 2022 | Aug. 31, 2021 |
3.100% Unsecured Notes due 2022 | Unsecured Notes | ||||
Subsequent Event [Line Items] | ||||
Stated interest rate | 3.10% | |||
Subsequent Event | 2022 Revolving Credit Agreement, Five-Year Facility | Unsecured credit facility | ||||
Subsequent Event [Line Items] | ||||
Debt term | 5 years | |||
Maximum borrowing capacity | $ 3,500,000,000 | |||
Subsequent Event | 2022 Revolving Credit Agreement, Eighteen-Month Facility | Unsecured credit facility | ||||
Subsequent Event [Line Items] | ||||
Debt term | 18 months | |||
Maximum borrowing capacity | $ 1,500,000,000 | |||
Subsequent Event | 3.100% Unsecured Notes due 2022 | Unsecured Notes | ||||
Subsequent Event [Line Items] | ||||
Stated interest rate | 3.10% | |||
Subsequent Event | 3.100% Unsecured Notes due 2022 | Unsecured Notes | Forecast | ||||
Subsequent Event [Line Items] | ||||
Debt redeemed | $ 731,000,000 |