Revenue Analysis:
Reviewing the Total and Operating Revenues alongside Gross Profit margins shows a steady state. Total Revenue was $37.05 billion in Feb 2023, $36.71 billion in May 2023, $35.42 billion in Aug 2023, and $37.05 billion in Nov 2023, reflecting slight variability. However, the sudden increase to $37.05 billion in the latest Feb 2024 data indicates potential stabilization or growth. Gross Profit has seen a consistent pattern, with figures such as $7.06 billion in Feb 2023 and a slight decrease to $6.98 billion by Nov 2023, yet maintaining relative steadiness.
Cost Management:
The Cost of Revenue, Operating Expense, and Total Expenses have steadily increased. The Cost of Revenue ranged from $27.81 billion in Feb 2023 to $30.01 billion in Feb 2024. Total Expenses echo this growth, stretching from $34.74 billion in Feb 2023 to an increased $37.93 billion in Feb 2024. Operating Expenses consistently align closely with the Cost of Revenue, indicating substantial costs directly tied to primary business operations.
Profitability Analysis:
EBITDA has fluctuated starkly, from as high as $1.31 billion in Feb 2023 to a negative of $12.36 billion in Feb 2024, mainly due to substantial “Total Unusual Items”, hitting as high as $12.37 billion in expenses. Similarly, Operating Income and Pretax Income illustrated volatility, severely dropping into negatives as seen in the $-13.11 billion Pretax Income for Feb 2024. Net Income also faced steep declines, particularly noticeable with the drop to $-5.91 billion in Feb 2024.
Cash Flow Indicators:
Reconciled Depreciation appears somewhat consistent, ranging from $560 million in Feb 2023 to $614 million in Feb 2024. Interest Expense figures remain significant, suggesting substantial debt servicing costs, observable through consistent figures such as $138 million in Feb 2024.
Taxation:
Exploring taxation reveals varied Tax Rates with calculations showing swings from 11.5% in Feb 2023 increasing to 40% in August 2023 then reducing to 6% by Feb 2024. However, the detailed impact of taxes on financial metrics like Net Income is more dramatic, especially with Tax Provisions often either negligible or offset by “Tax Effect Of Unusual Items”, showing a notably large impact in Feb 2024 with $-782 million.
Shareholder Metrics:
Diluted and Basic EPS shows a significant range, from a high of $0.81 in Feb 2023 to a low of $-6.85 by Feb 2024. Average Shares have remained stable around 863 million, ensuring consistency in shareholders’ metrics calculations. The Net Income Available to Common Stockholders mirrors Net Income precisely, further demonstrating deep impacts during losses.
Conclusion:
The financial performance of WBA has shown significant volatility over the past years, primarily driven by unusual items impacting profitability. The stable revenue alongside growing costs suggest a pressure on profit margins. Given the massive losses primarily from unusual expense items, strategic review and possible operational adjustments could be recommended to stabilize the financial health of the business.