Lloydspharmacy and AAH parent company Celesio has hailed its 4.5 per cent profits rise as a strengthening of its "competitive position" in the market.

Celesio's profits rose to £490.9 million (€579.6m) in 2012, it announced today (March 26), which CEO Markus Pinger said "set the course for profitable growth".

He attributed Celesio's success to an organisational shake-up that began at the end of 2011, prompted by a 26 per cent drop in profits and and has since included the rollout of the Lloyds brand across its European pharmacies and cutting staff at its UK head office.

Celesio posted 2012 year-on-year growth of 5.1 per cent in its patient and consumer division, which included its income from pharmacies	More on Celesio New MD takes over at Lloyds and AAH Lloydspharmacy abandons 'premature' health villages Celesio launches independent network to rival       Boots' Alphega
	Celesio posted 2012 year-on-year growth of 5.1 per cent in its patient and consumer division, which included its income from pharmacies. This was largely driven by a "strong performance" in Sweden and Norway, the company reported.

But revenue from its pharmacy wholesale division fell 0.3 per cent to £15.9 billion (€18.8bn), which Celesio attributed to a number of "blockbuster" drugs coming off patent. This had led to "more intense competition with low-cost generics, cutting down prices of pharmaceutical products on the market", Celesio reported.

Integrating its European pharmacy network with its wholesale and logistics businesses was a priority for the year ahead and would enable Celesio to "cover the entire value chain from pharmaceuticals producer to end consumer", Mr Pinger said.

Celesio would focus on innovations such as its new-look pharmacies, which had already been tested in four branches, including two in the UK, Mr Pinger said. The branches had been revamped to give a stronger focus on skincare and pain management and Mr Pinger reported that results had been "very positive and highly promising".

In August 2012, Celesio announced double-digit growth for the first half of the year compared with the same period in 2011. It marked a turnaround for the company, following the 26 per cent fall in operating profits in 2011.