Record quarter sales of $15 billion (up 9.6% over last year)will only grow as baby boomers hit their senior years, saidChairman and CEO Jeffrey A. Rein. Net earnings for the quarter rose2% over the previous year to $572 million. Total comp-store salesrose 3.4%.

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"In spite of the current environment, nothing will slow theimpact of nearly 80 million baby boomers moving into their chiefprescription-use years," Rein said. "This is a very good businessto be in for the long term."

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Walgreens will open 550 new drugstores this year, with a netincrease of more than 500, expanding its drugstore base byapproximately 9% in fiscal 2008. This is higher than its moretypical 8% growth, boosted by swifter-than-normal entitlementprocesses, and is unlikely to be repeated.

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"Many of these sites were [contracted] approximately 24 to 36months ago," Rein said. "In future years we will see this growth[level] go down."

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The company remains on track to meet its goal of operating morethan 7,000 drugstores by 2010. In May, Walgreens announced plans toopen its first stores in Alaska in 2009, giving the company apresence in all 50 states.

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As of May 31, Walgreens operated 6,727 locations in 49 states,the District of Columbia and Puerto Rico.

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