Pretax profit at Boots drops 50%

PRETAX PROFITS at the Irish arm of pharmaceutical retail giant, Boots more than halved last year to €11 million.

Revenue at Boots Retail (Ireland) Ltd increased marginally to €265.8 million in the 12 months to the end of March last, from €262.6 million the previous year, according to figures just filed with the Companies Office.

However, a 10 per cent increase in operating costs contributed to a 52.5 per cent drop in pretax profits to €11 million from €23.3 million a year earlier.

Debbie Smith, the recently appointed managing director of Boots Ireland, has said like-for-like revenues declined by 3.9 per cent to €235 million, with the company’s results citing “the fragile state of the Irish economy”.

The figures also show that the Irish subsidiary paid a dividend of €85 million to its parent last year.

This reduced the group’s accumulated profits from €88 million to €11 million to the end of March last. According to the directors’ report: “Lower retail sales from the fragile state of the Irish economy were offset by excellent growth in dispensing, which was well ahead of the market.”

Ms Smith has expanded the pharmacy end of Boots’ Irish businesses after discovering the brand was better known for its health and beauty products.

The directors’ report continues: “Four new stores were added during the year, reflecting our strategy to significantly expand our presence and at year end, we have 55 stores.”

Boots recently opened a new store in Limerick. The figures show the group increased the number it employs by 70 people last year to 1,332. Staff costs increased by 9 per cent to €51.3 million from €47 million in the 12 months to the end of March.

The accounts show that gross profit decreased marginally from €132.3 million to €131 million, while the cost of sales edged up 1 per cent to €133 million.

The directors’ remuneration, including pension contributions, increased from €236,000 to €281,000 to the end of March 2010.