By Micah Maidenberg

Shares of Walgreens Boots Alliance Inc. rose 3% in midday trading in New York after the drugstore chain beat adjusted-profit expectations and told investors it anticipates stronger profit growth during the second half of its new fiscal year.

Walgreens' stock hasn't recorded a gain of 3% or more since Aug. 10, according to FactSet.

"Results are better than feared," analysts at Mizuho Securities USA LLC said in a note.

Overall, sales for its fiscal fourth quarter that ended Aug. 31 rose to $34.75 billion from $33.95 billion. Profit fell to $373 million, or 43 cents a share. But after adjustments, the company reported earnings of $1.02 cents a share, better than the consensus estimate.

For the first half of its new fiscal year that started Sept. 1, Walgreens assumes a decline in adjusted earnings per share of 17% to 23%. During the second half of the year, however, the company thinks those profits will recover, rising 30% to 40%, executives said on a call.

The company on Thursday said it believes it will generate low single-digit growth in earnings per share, following adjustments, in its new fiscal year.

"We assume continued gradual improvements quarter by quarter," finance chief James Kehoe said. He added that "it is realistic to assume continued negative Covid-19 impacts in the first two quarters of the year."

Walgreens has been trying to return its Boots UK unit to growth. Those stores have been hit hard by the decline in consumer visits due to the pandemic. The company has also faced challenges resulting from people skipping appointments with medical providers as the coronavirus spread, a dynamic that weighed on prescription volumes.

Write to Micah Maidenberg at micah.maidenberg@wsj.com

(END) Dow Jones Newswires

10-15-20 1216ET