{"id":705,"date":"2019-09-30T21:31:05","date_gmt":"2019-09-30T21:31:05","guid":{"rendered":"https:\/\/jobbinghood.com\/finance\/2019\/09\/30\/walgreens-knew-its-profit-forecast-was-wrong-but-didnt-tell-investors-sec-says\/"},"modified":"2019-09-30T21:31:05","modified_gmt":"2019-09-30T21:31:05","slug":"walgreens-knew-its-profit-forecast-was-wrong-but-didnt-tell-investors-sec-says","status":"publish","type":"post","link":"https:\/\/jobbinghood.com\/magazine\/2019\/09\/30\/walgreens-knew-its-profit-forecast-was-wrong-but-didnt-tell-investors-sec-says\/","title":{"rendered":"Walgreens knew its profit forecast was wrong but didn&#8217;t tell investors, SEC says"},"content":{"rendered":"<p> [ad_1]<br \/>\n<\/p>\n<div id=\"storytext\">\n<div id=\"js-ie-storytop\" class=\"ie--storytop\">\n<div class=\"cnnplayer\" id=\"cnnplayer0\">\n<div class=\"cnnVidplayer\">\n<div class=\"summaryImg\" id=\"vid0\" href=\"http:\/\/money.cnn.com\/video\/news\/2018\/04\/24\/drug-prices-high-spending-orig.cnnmoney\"> <img fetchpriority=\"high\" decoding=\"async\" src=\"https:\/\/i2.cdn.turner.com\/money\/dam\/assets\/180424115138-bottles-of-prescription-pills-1024x576.jpg\" width=\"780\" height=\"439\" alt=\"Here's why drug prices are so high\" border=\"0\" \/> <\/div><\/div><\/div><\/div>\n<h2 class=\"speakable\">Six years ago, Walgreens announced a merger with Boots and told investors that it would make at least $9 billion in profit in 2016. The SEC says the company knew that number was a fantasy.<\/h2>\n<p class=\"speakable\"> Walgreens&#8217; former CEO Greg Wasson and CFO Wade Miquelon were well aware that the pharmacy would miss that $9 billion target badly, the SEC alleged on Friday. Yet Walgreens&#8217; top brass repeatedly affirmed the number to investors in earnings calls throughout 2013 and 2014. <\/p>\n<p class=\"speakable\"> Finally, in August 2014, two years after it first announced the Boots merger, Walgreens admitted it wouldn&#8217;t meet its profit forecast. It drastically cut its 2016 adjusted operating profit target down to $7.2 billion, shocking investors. The stock dropped more than 14% when it announced the change. <\/p>\n<p> The SEC on Friday settled with Walgreens for misleading its investors. Walgreens agreed to pay a $34.5 million penalty. <\/p>\n<p> &#8220;Over multiple reporting periods, senior Walgreens executives misled investors about the company&#8217;s public financial goal,&#8221; said Stephanie Avakian, co-director of the SEC&#8217;s Division of Enforcement in a statement. &#8220;The penalty assessed against Walgreens is intended to punish and deter such conduct, which deprived investors of information necessary to make fully informed investment decisions.&#8221; <\/p>\n<p> According to the SEC, <span>Walgreens&#8217;<\/span> <span>(<span class=\"inlink_chart\"><a href=\"https:\/\/money.cnn.com\/quote\/quote.html?symb=WBA&amp;source=story_quote_link\" class=\"inlink\" target=\"_blank\" rel=\"noopener\">WBA<\/a><\/span>)<\/span> internal forecasts said management knew the risk of missing the 2016 projection had increased &#8220;significantly.&#8221; <\/p>\n<p> In its settlement, Walgreens did not admit or deny the allegations. <\/p>\n<p> &#8220;The settlement does not involve any of Walgreens Boots Alliance&#8217;s current officers or executives, nor does it allege that anyone acted intentionally or recklessly at any time,&#8221; the company <a href=\"https:\/\/www.businesswire.com\/news\/home\/20180928005336\/en\/Walgreens-Boots-Alliance-Announces-Agreement-Securities-Exchange\" target=\"_blank\" rel=\"noopener noreferrer\">said in a release<\/a>. <\/p>\n<p> Wasson and Miquelon each will pay a $160,000 penalty. Walgreens&#8217; stock was unchanged on the news. <\/p>\n<p> <span class=\"cnnStorySource\"> CNNMoney (New York) <\/span> <span class=\"cnnDateStamp\">First published September 28, 2018: 12:15 PM ET<\/span> <\/p>\n<\/p><\/div>\n<p>[ad_2]<br \/><\/p>\n<div class=\"jobbi-after-content-jh-placement jobbi-entity-placement\" id=\"jobbi-2078408034\"><div id=\"jobbi-1260540305\"><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-5862940809620110\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-5862940809620110\" \ndata-ad-slot=\"\" \ndata-ad-format=\"auto\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><\/div>","protected":false},"excerpt":{"rendered":"<p>[ad_1] Six years ago, Walgreens announced a merger with Boots and told investors that it would make at least $9 billion in profit in 2016. The SEC says the company knew that number was a fantasy. Walgreens&#8217; former CEO Greg Wasson and CFO Wade Miquelon were well aware that the pharmacy would miss that $9 [&hellip;]<\/p>\n","protected":false},"author":348,"featured_media":706,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-705","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-companies"],"_links":{"self":[{"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/posts\/705","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/users\/348"}],"replies":[{"embeddable":true,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/comments?post=705"}],"version-history":[{"count":0,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/posts\/705\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/media\/706"}],"wp:attachment":[{"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/media?parent=705"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/categories?post=705"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jobbinghood.com\/magazine\/wp-json\/wp\/v2\/tags?post=705"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}