The US owner of Boots has warned of possible store closures in the UK as it tries to cut costs.
As reported by the BBC, Walgreens Boots Alliance said it would take decisive steps to reduce costs as part of a company-wide significant restructuring. The move comes after the chain said it had suffered its most difficult quarter since the firm’s formation with UK like-for-like sales down 2.3%.
The chain has 2,500 stores across the UK, employing around 60,000 staff.
Chief executive Stefano Pessina said market challenges had accelerated in the three months to the end of February, but that it had failed to respond rapidly enough resulting in a disappointing quarter.
“We are going to be more aggressive in our response to these rapidly shifting trends,” he added. Actions announced include optimising its store footprint and increasing its planned annual cost savings from $1bn to $1.5bn.
The cost cuts follows Boots’ announcement in February that 350 jobs were at risk in its Nottingham head office amid plans to reduce costs by 20%. Overall earnings for the firm’s second quarter were down 14.3% compared to the same period last year. The company said it was now expecting profit to be flat for the full year, down from its earlier guidance of 7% to 12% growth.