Jul 7, 2022
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Superdrug annual sales and profits rise, despite challenging year and tough Q1

Jul 7, 2022

​Superdrug has filed its annual results and said that the 53 weeks to 1 January 2022 were challenging with the year the accounts covered having started with a lockdown that stayed in place for several months.

A.S. Watson

So it’s no surprise that revenue for the health & beauty retailer fell as much as 29% in the first quarter compared to the same period in 2020.

But the company said that it recovered as the second quarter unfolded when lockdown restrictions were lifted, although the arrival of the Omicron variant in the run-up to Christmas dented the important final month of the year.

So what does that translate to in numbers? Overall revenue increased by 5.1% to £1.168 billion, although the growth was boosted by the inclusion of the 53rd week, whereas the previous financial year had only 52 weeks.

Profit before tax rose 141.3% to £45.3 million. The higher profit and revenue were helped by the easing of Covid-19 restrictions and higher footfall to physical stores, as well as by the fact that in the previous year the company’s figures had included an impairment provision of £10.7 million. The operating margin also increased to 5.1% compared to 3.2% a year earlier.

And the company maintained a modest level of capital expenditure, which rose 6.8% year on year, but was still below pre-pandemic levels.

As mentioned, Superdrug said it was a challenging period and UK retail as a whole saw an average footfall decline during the year of 35.4% compared to before the pandemic.

But even with difficult times for physical stores, the retailer benefited from sales through its online channel and they were up 48.5% compared to 2019, although it didn't specify the comparison with 2020.

It also said that its Health & Beautycard customer loyalty programme remained pivotal to its engagement with its customers and sales from members (there are 15.9 million of them) rose during the year.

It added that the proportion of sales made of its own-brand products or products exclusive to the chain also rose last year.

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