Boots parent company posts 22% drop in quarterly profit

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Walgreen Boots Alliance

The US-based parent company of health and beauty retailer Boots has reported a double-digit fall in quarterly profit, despite an almost eight per cent uplift in overall sales.

For the first quarter ending November 30, net earnings attributable to Walgreens Boots Alliance decreased 22.1 per cent to $821 million (£606 million) compared with the same quarter a year ago, while sales increased 7.9 per cent to $30.7 billion (£22.6 billion).

The company, which also operates the Walgreens pharmacy chain in the US, attributed its fall in profit to an impairment charge related to its investment in Chinese wholesale partner Guangzhou Pharmaceuticals, which it announced in December.

However, adjusted diluted net earnings per share were $1.28, an increase of 16.4 percent, while adjusted net earnings attributable to Walgreens Boots Alliance increased 7.8 per cent to $1.3 billion.

Meanwhile, Retail Pharmacy International – the subsidiary within Walgreen Boots Alliance of which Boots in the UK is a part – recorded sales of $3.1 billion (£2.2 billion), a 0.8 per cent decrease on a constant currency basis.

Like-for-likes also decreased by 4.1 per cent.

On a constant currency basis, Retail Pharmacy International’s comparable store sales decreased 0.7 per cent compared to the same quarter a year prior, comparable pharmacy sales decreased 0.1 per cent, and comparable retail sales decreased by one per cent.

For Boots UK alone, comparable pharmacy sales were up 0.1 per cent, while comparable retail sales were 1.4 per cent lower amid what Walgreens Boots Alliance said was a challenging market place.

In a statement, chief executive and executive vice chairman Stefano Pessina said he was pleased Walgreens Boots Alliance had “delivered another strong performance in the first quarter”.

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