Walgreens February Sales Increase 7.8 Percent

DEERFIELD, Ill., March 03, 2011 - Walgreens (NYSE: WAG) (NASDAQ: WAG) had February sales of $5.73 billion, an increase of 7.8 percent from $5.32 billion for the same month in 2010. Duane Reade stores, acquired in April 2010, contributed 2.7 percentage points to the total sales increase for the month.

Total front-end sales increased 10.6 percent in February, including 4.5 percentage points from Duane Reade stores. Comparable store front-end sales increased 3.8 percent. Customer traffic in comparable stores increased 1.6 percent, while basket size increased 2.2 percent.

Prescriptions filled at comparable stores increased 4.3 percent in February. There was no calendar day shift impact for the month. The higher incidence of flu positively impacted comparable prescriptions filled by 1.2 percentage points, while fewer flu shots negatively impacted prescriptions filled at comparable stores by 0.2 percentage point. The company estimates that February prescriptions filled were negatively impacted 0.5 to 1.0 percentage point due to many pharmacy patients filling their prescriptions in late January in advance of the severe winter storm that impacted the Midwest in early February.

February pharmacy sales increased 6.4 percent, while comparable pharmacy sales increased 2.7 percent. Comparable pharmacy sales were negatively impacted by 2.9 percentage points due to generic drug introductions in the last 12 months. Pharmacy sales accounted for 64 percent of total sales for the month.

Sales in comparable stores (those open at least a year) increased 3.1 percent. Duane Reade stores are not included in any comparable store results.

Flu shots administered season-to-date at pharmacies and clinics totaled 6.4 million.

Total sales for the second quarter of fiscal 2011 were $18.46 billion, up 8.7 percent from $16.99 billion in the second quarter of fiscal 2010. Comparable store sales for the second quarter of fiscal 2011 increased 4.0 percent, while front-end comparable store sales for the quarter also increased 4.0 percent. Prescriptions filled at comparable stores increased 4.5 percent in the second quarter.

Calendar year-to-date sales were $11.66 billion, an increase of 9.5 percent from $10.65 billion in 2010.

Fiscal 2011 year-to-date sales for the first six months were $35.80 billion, up 7.4 percent from $33.35 billion in fiscal 2010.

Walgreens opened 22 stores during February, including two relocations, acquired two stores and closed two.

As a reminder, March sales will be negatively impacted by this year’s later Easter, which falls on April 24 this year compared with April 4 last year. The company will report combined comparable store sales for March and April with its April sales results.

At Feb. 28, Walgreens operated 8,161 locations in all 50 states, the District of Columbia, Puerto Rico and Guam. That includes 7,689 drugstores, 509 more than a year ago, including 288 stores acquired over the last 12 months. The company also operates worksite health centers, home care facilities, and specialty and mail service pharmacies. Its Take Care Health Systems subsidiary manages more than 700 in-store convenient care clinics and worksite health and wellness centers. Franchisees of Option Care, Inc., a wholly-owned subsidiary of Walgreens, are not included in Walgreens location or store count.

* Includes +1.3 from patients filling more 90-day prescriptions

Please note: Sales numbers and the adjustments shown in the table are preliminary and unaudited. Comparable stores are defined as those drugstore locations open for at least 12 consecutive months without closure for seven or more consecutive days and without a major remodel or a natural disaster in the past 12 months. Acquired operating locations, including Duane Reade stores and relocations are not included as comparable stores for the first 12 months after the acquisition or relocation.

Statements in this release that are not historical are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance and involve risks, assumptions and uncertainties, including, but not limited to, the incidence of flu and the number of flu shots administered as well as those described in Item 1A (Risk Factors) of our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, each of which is incorporated herein by reference, and in other documents that we file or furnish with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by law, Walgreens undertakes no obligation to update publicly any forward-looking statement after the distribution of this release, whether as a result of new information, future events, changes in assumptions or otherwise.

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