Walgreens suspends dividend, breaking 90-plus year streak of shareholder payouts

abcnews.go.com:

Shares of Walgreens dove early Friday, a day after the drugstore chain said it was suspending its dividend, breaking a streak of quarterly shareholder payouts that stretches back more than 90 years

Shares of Walgreens dove early Friday, a day after the drugstore chain said it was suspending its dividend, breaking a streak of quarterly shareholder payouts that stretches back more than 90 years.

The drugstore chain said Thursday after markets closed that it made the move to strengthen its balance sheet and improve free cash flow as company leaders try to turn around the struggling business.

Walgreens has been dealing with thin prescription reimbursement, rising costs, persistent theft and inflation-sensitive shoppers who are looking for bargains elsewhere. The company is in the early stages of a plan to close 1,200 of its roughly 8,500 U.S. locations.

The company said in a brief statement Thursday that its cash needs over the next several years for things like litigation and debt refinancing were big parts of the decision to suspend the dividend.

Earlier this month, the U.S. Justice Department filed a lawsuit in federal court accusing the drugstore chain of filling millions of prescriptions without a legitimate purpose, including some for dangerous amounts of opioids.

In September, the company said it would pay $106 million to settle separate litigation over false payment claims.

Walgreens started last year by cutting the quarterly dividend nearly in half. The company slashed the payout to 25 cents from 48 cents after spending about $1.7 billion on cash dividends in fiscal 2023.

Chief Financial Officer Manmohan Mahajan told analysts earlier this month that Walgreens still was evaluating “the appropriateness and size of