Boots sales slump as shoppers prioritise supermarkets during pandemic
Boots suffered a sharp drop in sales in the first quarter as consumers shifted towards “one-stop” supermarket shopping during the pandemic, the high street pharmacy’s US owner announced today.
Walgreens Boots Alliance (WBA), the parent company of the UK chemist chain, said its retail pharmacy division’s sales fell 6.2 per cent to $2.6bn, driven by a 11.5 per cent drop in Boots UK sales.
Boots pharmacy sales were up 2.5 per cent due to the “favourable timing” of the NHS reimbursement, which mitigated the impact of lower prescription volumes and demand for services during the pandemic.
However retail sales plunged 9.1 per cent due to a steep decline in high street, train station and airport footfall.
The company traded strongly online, with digital sales up 106 per cent year-on-year.
The high street chain’s market share was lower in all categories except beauty, as the pandemic drastically impacted buying habits and consumers swapped to one-stop grocery shopping.
Gross profit decreased nine per cent compared to the same period a year previous.
Meanwhile, WBA reported a 5.7 per cent jump in overall first quarter sales, reflecting growth in its US retail pharmacy and wholesale divisions.
The company announced yesterday that it will divest its pharmaceutical wholesale business, with plans to use the proceeds to accelerate its investments in healthcare.
WBA executive vice chairman and chief executive Stefano Pessina said today: “While the business environment remains challenging, we are rising to the occasion with agility and discipline and we are confident in our outlook for adjusted earnings per share for the fiscal year.
“Our role in the healthcare system has never been more important, as the communities we serve continue to turn to our trusted brands and expert pharmacists.
“I am so proud of our teams and the historic and critical role they are playing to help the world emerge from the pandemic, administering Covid-19 vaccinations to frontline healthcare workers and vulnerable members of our society.”