LONDON - Alliance Boots PLC said Monday it is cutting about 1,500 jobs across its pharmaceutical-wholesale division in response to intense competition, difficult market conditions and major regulatory changes in some European countries.
The European pharmacy and beauty-products company recently started restructuring the division. A quarter of the 1,500 jobs have already been cut in the year ended March 31, said Finance Director George Fairweather. The job losses across the division will mean a 10% cut in headcount over the next 12 months.
Associated Press
Alliance Boots said it is cutting about 1,500 jobs at its wholesale pharmaceutical division.
The job losses overshadowed a sharp rise in net profit and sales for the 12 months ended March 31, lifted by a solid performance at Boots's Health & Beauty division and by acquisitions in Germany and France.
Annual net profit jumped to £101 million ($153.2 million) from £10 million a year earlier, helped by a 45% rise in revenue to £17.20 billion from £11.87 billion.
Alliance Boots, which is owned by private-equity firm Kohlberg Kravis Roberts & Co. and businessman Stefano Pessina, booked a 12% rise in trading profit, including its share of associates and joint ventures, to £953 million.
The company's health-and-beauty division, which includes Boots U.K., posted a 12% increase in annual trading profit, while its pharmaceutical-wholesale unit booked a 4.4% increase. The pharmaceutical-wholesale division's restructuring, however, produced charges of £60 million, but is expected to cut operating costs by around £55 million annually by fiscal 2012.
Alliance Boots generated £1.05 billion of cash in fiscal 2009 and had net debt of £9.03 billion at the end of March.
Alliance Boots operates more than 3,200 health and beauty-retail outlets in nine countries, of which over 2,900 have a pharmacy, according to its Web site. The company's wholesale and distribution network serves more than 135,000 pharmacies, doctors, health centers and hospitals from over 370 pharmaceutical-wholesale depots in 15 countries.
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