Announcing its latest financial results yesterday (July 1), Walgreen Boots Alliance noted the increase was representative of the “stronger pharmacy services and favourable timing of NHS reimbursement, partially offset by lower prescription volume”.

It means that in the year to date, pharmacy sales for the multiple have increased 3.1% compared with 2020.

Boots UK comparable retail sales increased 38.7% in March-May, compared with the same period the previous year, and a 42.3% online sales growth for the multiple compared with a year ago, as “footfall on the high street showed early signs of recovery amid a partial easing of strict lockdown measures”.

“Significant rebound” from 2020’s losses

Speaking to shareholders on a call yesterday afternoon, James Kehoe, global chief financial officer at Walgreen Boots Alliance, described the results as “excellent”, noting that “less severe UK restrictions” had led to a “significant rebound” from 2020’s losses.

However, he cautioned that “the recovery is slower than we first expected”.

In particular, Mr Kehoe said Walgreens Boots Alliance is “encouraged by the rebound in sales and profitability due to focused execution across Boots UK, Boots Ireland and Opticians”.

However, he noted that footfall for the three months to May was still approximately 45% below pre-pandemic levels – an improvement on the 70-75% decline that the company saw during the April peak last year.

Walgreens Boots Alliance chief executive Roz Brewer – who took on the role in March – said the latest financial results show that the business is “in a strong position to grow and innovate our core retail and pharmacy business for the future”.

“I remain proud of our team members and the essential role they are playing to help end the pandemic as the communities we serve continue to turn to our trusted brands and expert pharmacists,” she added.

“Peak quarter” for COVID-19 vaccines

The three months to May was the “peak” for the company’s global COVID-19 vaccination efforts, Mr Kehoe said. Currently there are 51 Boots UK operated COVID-19 vaccination sites.

Meanwhile, the multiple has also administered three million COVID-19 tests, “in addition to testing partnerships with several major airlines”, Mr Kehoe added. Yesterday, Boots announced it had partnered with easyJet to offer COVID-19 tests for travellers this summer.

Seb James, Boots UK chief executive, said in a statement: “I am extremely proud that during the pandemic our team members were on the front line supporting the NHS testing and vaccination programmes as well as supplying medicines and giving health advice when many GP surgeries were not open.”

Recovering from Boots COVID-19 losses

Walgreens Boots Alliance recorded a quarterly income of $1.1bn (£800m), compared to a loss of $1.7bn (£1.2bn) over the same period last year, which the company primarily attributed to $2bn (£1.5bn) “non-cash impairment charges […] related to goodwill and intangible assets in Boots UK”.

A spokesperson for Walgreens Boots Alliance confirmed that the Boots UK business had lost around£1.5bn in value last year due to the impact of the COVID-19 pandemic, “largely following the significant decline in footfall, which impacted its revenue-driving retail operations”.

The increase in revenue streams “reflect strong adjusted gross profit growth” and a “rebound” in the UK business’s profitability, the spokesperson added.

CEO: We must build on pharmacy assets of today

Addressing the shareholders’ meeting yesterday, Ms Brewer reaffirmed her commitment made at the start of the year of “conducting a detailed review of our long-range business plans across the company, including where we should make further investments, allocate capital and deliver the best financial returns”.

“There are tremendous opportunities in healthcare right now and we are uniquely positioned to capitalise on them,” she added.

Walgreens Boots Alliance also remains “committed to our previously stated priorities to create neighbourhood health destinations around a more modern pharmacy”, Ms Brewer said.

“Said simply, in order to build the pharmacy of the future and new healthcare solutions, we must build upon the key assets of the pharmacy of today.”