Health retailer Boots has reported stronger-than-expected first-quarter sales at its core chemist chain but a sharp downturn at its manufacturing operations.
The retailer said todaythat in the majority of health and beauty products it had continued to hold or gain market share despite tough competition from supermarkets.
"It is a good start to the year and reassuring," said a spokesman for the company, whose shares were down about 1.4 per cent at 647p after the first-quarter statement.
Boots The Chemist (BTC) has a 25 per cent share of the health and beauty market and provides 85 per cent of group profits.
In a statement ahead of the company's annual meeting, the group said overall retail sales for the quarter ended June 30th were up 3.9 per cent or 2.7 per cent excluding new space.
Sales at BTC rose 2.5 per cent on a like-for-like basis, with health and beauty products up 4.6 per cent on the same basis, higher than most analysts' predictions of one percent growth.
Gross margin was not disclosed in the statement, but analysts said they understood that margin was up and inflation contributed around 0.3 per cent of Boots' underlying sales gain.
But Boots Healthcare International, maker of the Clearasil and Nurofen brands, saw a 7.7 per cent drop in like-for-like sales, partly because merchants had stocked up in the previous quarter in anticipation ofprice controls ending.