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Boots Ireland profits up 11pc as UK stores are closed down

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Profit: Boots high street store

Profit: Boots high street store

Profit: Boots high street store

The Irish arm of pharmaceutical chain Boots saw an 11pc rise in its operating profit last year to €26.5m thanks to the opening of new stores and strong pharmacy sales.

Revenues rose 3.5pc to €339.6m in the 12 months to August 31, according to accounts for the company.

The company, which has 87 outlets in the Republic of Ireland, said its operating profit margin of 6.6pc for the financial year was driven by improved product range and promotions, the introduction of new product developments, and "strong" cost control.

In a sign of the shift to online, the company's website here received an average of 721,000 visits per month over the year, an increase on the 673,000 monthly visitors in financial year 2018.

Boots Ireland paid a dividend of just over €20,000 to its parent company, Walgreens Boots Alliance.

However, as the results are for the 12 months to August 31 last year, it does not cover the period since Covid-19 first arrived in Ireland.

Restrictions aimed at limiting the spread of the deadly disease have resulted in a drop in footfall in urban areas.

Earlier this month the company's parent, Walgreens Boots Alliance, said it would close stores, cut jobs and suspend share repurchase as the coronavirus crisis hammered its ailing Boots UK division, leading to a £1.5bn (€1.7bn) impairment charge in the third quarter.

Stringent lockdown measures in Britain led to an 85pc plunge in traffic in its Boots UK stores in April, the company said.

The shop closures will lead to around 4,000 jobs losses, however staff in the Republic of Ireland will not be impacted by the decision.

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Walgreens said the Boots UK store closures and job cuts, which include a 20pc headcount reduction at its support office, accelerated a restructuring already in train.

With time running out rapidly for a UK-European Union trade deal, Boots Ireland said it had put in place "detailed plans" to mitigate risks that could materialise as the end-year date for a deal approached.

In addition, it had been increasing its stock levels in shops "where appropriate."

US-based Walgreens portfolio of retail and business brands includes Walgreens, Duane Reade, as well as a number of health and beauty product brands.

Walgreens missed earnings expectations and its stock is the worst performer on the Dow Jones Industrial Average over the past 12 months.

Additional reporting Reuters


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