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Last year, Walgreen and the nation's biggest pharmacy benefits manager, Express Scripts Holding Co., had a contract squabble that kept them from doing business for about nine months. That hurt the drugstore chain's results as many Walgreen customers migrated to competitors for their prescriptions, at least temporarily. The companies resumed doing business last September, and Walgreen says customers have been returning to its stores. Walgreen said Tuesday that results in this year's quarter also were helped by its acquisition of a stake in European health and beauty retailer Alliance Boots. That contributed about 10 cents per share to the U.S. company's adjusted earnings. Walgreen said revenue from stores open at least a year climbed 1.4 percent in the quarter, but front-end sales barely rose. Company leaders said that did not meet their expectations. They said a soft economy has hurt those results, especially in stores in lower-income neighborhoods. "I can assure you that improving our front end is a high priority," CEO Greg Wasson said. He said the company has started to customize its advertising circulars more toward individual communities. Walgreen also is using buying trends it gleans from its Balance Rewards customer loyalty program to tailor its promotions. The program lets shoppers pile up points for purchases that they can then translate into cash rewards to use at company stores, and it also gives Walgreen more insight into customer buying patterns.
Walgreen runs 8,097 drugstores nationwide, or 207 more than it did last year. That's more than the totals for CVS Caremark Corp. and Rite Aid Corp.
[Associated
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