Shares of Walgreens Boots Alliance Inc., having closed a day earlier at a 14-year low, slumped a further 7.4% on Friday, as the drugstore chain and healthcare-services company said Chief Executive Rosalind Brewer had stepped down after just 2½ years in that role.
The leadership change comes after Walgreens shares suffered their worst monthly decline in nearly five years in August, and a month after the surprise departure of the suburban Chicago–based company’s chief financial officer.
Separately, Walgreens said it expects 2023 adjusted earnings per share to be at or near the low end of previous guidance. In June, the company cut its full-year guidance to $4 to $4.05, while the current FactSet earnings-per-share consensus is at $4.01.
The company said Friday that it and Brewer had “mutually agreed” that she would step down as of Aug. 31. Brewer, a former executive at Starbucks, Walmart and Kimberly-Clark who joined Walgreens in March 2021 as CEO, will act as an adviser while the company searches for a permanent replacement.
“On behalf of the entire Board, I would like to thank Roz for her contributions to WBA,” the board’s executive chair, Stefano Pessina, said in a statement. “Roz navigated the Company through the global pandemic, overseeing the critical rollout of vaccines in Walgreens pharmacies and to high-risk populations across the country.”
Brewer leaves with a “platinum parachute” including a cash payout of $9 million, Crain’s Chicago Business reported.
The company has appointed Ginger Graham as interim CEO. Graham is currently Walgreen’s lead independent director and has been a board member since 2010.
“Ginger is the ideal person to serve as interim CEO, given her leadership experience across multiple segments of the healthcare industry, deep knowledge of WBA, and strong operational skills,” Pessina said.
Brewer’s departure follows the surprising news a month ago that Chief Financial Officer James Kehoe was leaving to pursue a “new opportunity.”
The high-level leadership changes come as investors have grown weary of Walgreens’ transformation toward healthcare delivery.
The stock tumbled 15.6% in August, its biggest monthly decline since it plunged 19.3% in December 2018.
“I look forward to watching the company continue its transformation to deliver localized health care,” Brewer said.
Walgreen shares WBA, -7.43% have tumbled 19% over the past three months through Thursday, while shares of rival CVS Health Corp. CVS, +0.77% have lost 4.6% and the Dow Jones Industrial Average DJIA has gained 7.2%.