Ireland blot on profits at Boots

IRELAND was the only blot in a record fiscal year for international pharmacy and beauty products chain Boots, but it still has plans to expand here.

The company, which trades as Alliance Boots everywhere bar in the Republic, enjoyed global profits of more than £1bn (€1.17bn) for the fiscal year ending March 31. It now ranks with Tesco and Marks & Spencer as the only British retailers to have surpassed the £1bn profit threshold.

The company’s global revenues rose 9.6% to £22.5bn, including a 10.3% increase at its wholesale arm and a 5.2% rise at its health and beauty division. In Ireland, however, like for like revenue decreased by 3.9%, despite a revenue increase of 1.1% on a constant currency basis.

The company’s preliminary report stated: “Like for like revenue decreased by 3.9%, the fragile state of the Irish economy impacting retail sales. During the year, the number of active Boots Advantage Card holders increased by nearly 30% to 700,000 in Ireland.

“Significant action has been taken to improve cost efficiencies. Four new stores were opened, including a flagship store in Cork. Further openings are planned in 2010/11, as we secure attractive store locations on competitive lease terms.”

Boots employs 1,800 in its 55 Irish existing stores.

The group last month said it was to open 10 new shops here in two phases, employing 300 new staff.

Globally, the group put its increased revenues down to sales growth of its own health, beauty and baby product ranges, in-store marketing initiatives, medical checkups and ongoing sales staff training.

The company has created strategic partnerships with Waitrose for trial selling, with Mothercare on a new children’s clothing brand, and with Procter & Gamble in Italy. In Britain, it merged Boots Opticians with Dollond & Aitchison.

Alliance Boots, which was bought in 2007 by private equity firm KKR for €11bn in Europe’s biggest leveraged buyout, said the 13% rise in trading profit made it confident of coping with anticipated subdued consumer demand across Europe this year.