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Segment reporting
 12 Months Ended
Aug. 31, 2018
Segment Reporting [Abstract]  
Segment reporting
Segment reporting
The Company has aligned its operations into three reportable segments: Retail Pharmacy USA, Retail Pharmacy International and Pharmaceutical Wholesale. The operating segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker) to assess segment performance and allocate resources among the Company’s operating segments. The chief operating decision maker uses adjusted operating income to assess segment profitability. The chief operating decision maker does not use total assets by segment to make decisions regarding resources, therefore the total asset disclosure by segment has not been included.

•
The Retail Pharmacy USA segment consists of the Walgreens business, which includes the operation of retail drugstores, convenient care clinics and mail and central specialty pharmacy services. Sales for the segment are principally derived from the sale of prescription drugs and a wide assortment of retail products, including health and wellness, beauty and personal care and consumables and general merchandise.
•
The Retail Pharmacy International segment consists of pharmacy-led health and beauty retail businesses and optical practices. These businesses include Boots branded stores in the United Kingdom, Thailand, Norway, the Republic of Ireland and the Netherlands, Benavides in Mexico and Ahumada in Chile. Sales for the segment are principally derived from the sale of prescription drugs and health and wellness, beauty and personal care and other consumer products.
•
The Pharmaceutical Wholesale segment consists of the Alliance Healthcare pharmaceutical wholesaling and distribution businesses and an equity method investment in AmerisourceBergen. Wholesale operations are located in the United Kingdom, Germany, France, Turkey, Spain, the Netherlands, Egypt, Norway, Romania, Czech Republic and Lithuania. Sales for the segment are principally derived from the wholesaling and distribution of a comprehensive offering of brand-name pharmaceuticals (including specialty pharmaceutical products) and generic pharmaceuticals, health and beauty products, home healthcare supplies and equipment and related services to pharmacies and other healthcare providers.
The results of operations for each reportable segment includes procurement benefits and an allocation of corporate-related overhead costs. The “Eliminations” column contains items not allocable to the reportable segments, as the information is not utilized by the chief operating decision maker to assess segment performance and allocate resources.

The following table reflects results of operations of the Company’s reportable segments (in millions):
 
Retail Pharmacy USA
 
Retail Pharmacy International
 
Pharmaceutical
Wholesale
 
Eliminations
 
Walgreens
Boots Alliance,
Inc.
For the year ended August 31, 2018
 
 
 
 
 
 
 
 
 
Sales to external customers
$
98,392

 
$
12,281

 
$
20,864

 
$
—

 
$
131,537

Intersegment sales
—

 
—

 
2,142

 
(2,142
)
 
—

Sales
$
98,392

 
$
12,281

 
$
23,006

 
$
(2,142
)
 
$
131,537

 
 
 
 
 
 
 
 
 
 
Adjusted operating income
$
5,923

 
$
947

 
$
934

 
$
—

 
$
7,804

 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
$
1,196

 
$
419

 
$
155

 
$
—

 
$
1,770

Additions to property, plant and equipment
1,022

 
241

 
104

 
—

 
1,367

 
 
 
 
 
 
 
 
 
 
For the year ended August 31, 2017
 

 
 

 
 

 
 

 
 

Sales to external customers
$
87,302

 
$
11,813

 
$
19,099

 
$
—

 
$
118,214

Intersegment sales
—

 
—

 
2,089

 
(2,089
)
 
—

Sales
$
87,302

 
$
11,813

 
$
21,188

 
$
(2,089
)
 
$
118,214

 
 
 
 
 
 
 
 
 
 
Adjusted operating income
$
5,707

 
$
909

 
$
924

 
$
—

 
$
7,540

 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
$
1,090

 
$
414

 
$
150

 
$
—

 
$
1,654

Additions to property, plant and equipment
860

 
384

 
107

 
—

 
1,351

 
 
 
 
 
 
 
 
 
 
For the year ended August 31, 2016
 

 
 

 
 

 
 

 
 

Sales to external customers
$
83,802

 
$
13,256

 
$
20,293

 
$
—

 
$
117,351

Intersegment sales
—

 
—

 
2,278

 
(2,278
)
 
—

Sales
$
83,802

 
$
13,256

 
$
22,571

 
$
(2,278
)
 
$
117,351

 
 
 
 
 
 
 
 
 
 
Adjusted operating income
$
5,357

 
$
1,155

 
$
708

 
$
(12
)
 
$
7,208

 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
$
1,134

 
$
401

 
$
166

 
$
17

 
$
1,718

Additions to property, plant and equipment
777

 
444

 
104

 
—

 
1,325


The following table reconciles adjusted operating income to operating income (in millions):
 
Retail Pharmacy USA
Retail Pharmacy International
Pharmaceutical
Wholesale
Eliminations
Walgreens
Boots
Alliance, Inc.
For the year ended August 31, 2018
 
 
 
 
 
Adjusted operating income
$
5,923

$
947

$
934

$
—

$
7,804

Acquisition-related amortization
 

 

 

 

(448
)
Certain legal and regulatory accruals and settlements1
 

 

 

 

(284
)
Acquisition-related costs
 

 

 

 

(231
)
Adjustments to equity earnings in AmerisourceBergen
 
 
 
 
(175
)
Store optimization
 
 
 
 
(100
)
LIFO provision
 

 

 

 

(84
)
Hurricane-related costs
 
 
 
 
(83
)
Asset recovery
 

 

 

 

15

Operating income
 

 

 

 

$
6,414

 
 
 
 
 
 
For the year ended August 31, 2017
 

 

 

 

 

Adjusted operating income
$
5,707

$
909

$
924

$
—

$
7,540

Acquisition-related amortization
 

 

 

 

(332
)
Acquisition-related costs
 
 
 
 
(474
)
Adjustments to equity earnings in AmerisourceBergen
 
 
 
 
(187
)
LIFO provision
 

 

 

 

(166
)
Cost transformation
 

 

 

 

(835
)
Asset recovery
 
 
 
 
11

Operating income
 

 

 

 

$
5,557

 
 
 
 
 
 
For the year ended August 31, 2016
 

 

 

 

 

Adjusted operating income
$
5,357

$
1,155

$
708

$
(12
)
$
7,208

Acquisition-related amortization
 
 
 
 
(369
)
Certain legal and regulatory accruals and settlements
 

 

 

 

(47
)
Acquisition-related costs
 
 
 
 
(102
)
Adjustments to equity earnings in AmerisourceBergen
 

 

 

 

(21
)
LIFO provision
 
 
 
 
(214
)
Cost transformation
 

 

 

 

(424
)
Asset recovery
 

 

 

 

(30
)
Operating income
 

 

 

 

$
6,001

1 
Beginning in the quarter ended August 31, 2018, management reviewed and refined its practice to include all charges related to the matters included in certain legal and regulatory accruals and settlements. This non-GAAP measure is presented on a consistent basis for fiscal year 2018.

No single customer accounted for more than 10% of the Company’s consolidated sales for any of the periods presented. In fiscal 2018, substantially all of our retail pharmacy sales were to customers covered by third-party payers (e.g., pharmacy benefit managers, insurance companies and governmental agencies) that agree to pay for all or a portion of a customer's eligible prescription purchases. Three third-party payers, in the Retail Pharmacy USA segment, in the aggregate accounted for approximately 32% of the Company’s consolidated sales in fiscal 2018. No third-party payer accounted for more than 10% of the Company’s consolidated sales in fiscal 2017 or fiscal 2016.

Geographic data for sales is as follows (in millions):
 
2018
 
2017
 
2016
United States of America
$
98,392

 
$
87,302

 
$
83,802

United Kingdom
13,297

 
12,552

 
14,081

Europe (excluding the United Kingdom)
17,594

 
16,224

 
16,793

Other
2,254

 
2,136

 
2,675

Sales
$
131,537

 
$
118,214

 
$
117,351


Geographic data for long-lived assets, defined as property, plant and equipment, is as follows (in millions):
 
2018
 
2017
United States of America
$
10,678

 
$
10,344

United Kingdom
2,458

 
2,502

Europe (excluding the United Kingdom)
576

 
616

Other
199

 
180

Total long-lived assets
$
13,911

 
$
13,642