Holland & Barrett posted a 30% rise in profits to £74m, as sales surge 9% to £335m this week. Retail Week speaks to Peter Aldis, chief executive of Holland & Barrett’s parent company NBTY Europe.
Retail Week: Are you pleased with the full-year figures?
Peter Aldis: We’re very proud of the numbers. We’ve had three years of good growth. We’ve done a lot of the basics well and expanded store numbers. With Holland & Barrett the cost base is fairly stable and so any benefit at the top line goes to the bottom line.
So 9% in sales has resulted in a much better profit growth. Like any business, we are aware that it is tough times and we’re not necessarily cutting costs, we are just very aware of what we’re spending.
How did you do it?
With store growth we have been taking more risks and covering key locations – such as in our London Canary Wharf store, we have a new design. And we have worked to become vertically more integrated. We make a lot of the vitamins and sports products ourselves which creates a solid retail performance.
We also launched our training academy which gives staff an NVQ-level accreditation.
How has trading been since your year-end in September?
We’re having a solid year. We’re still seeing good levels of growth with total sales across NBTY Europe for the half year to March up 6% – Holland & Barrett makes up 80% of the business. The first quarter from October to December was a good, solid one but since then the weather seems to be impacting every retailer in the land. However, we’re still in positive growth.
Like-for-like sales in the first half were 3.5% across NBTY Europe.
What have you been doing this year?
We are currently rolling out the new POS system to stores and we are close to launching a new website, which will enable us to launch click-and-collect and order in store, which will make us truly omnichannel.
We are also doing more around customer insight. We have a dedicated team for that now, which we didn’t have before.
What are your plans for overseas growth?
We are expanding in Ireland, Holland and now Belgium [after acquiring health food group Essenza last week]. We have 55 franchise stores overseas and we only started two years ago.
We are looking everywhere. There are no specific targets at the moment. In terms of Western Europe it will be ablewhich country and which brand and whether we enter the market in a physical or digital way.
Holland & Barrett is currently in Gibraltar, Iceland, Malta, Cyprus, Dubai, Singapore and China. I think overseas expansion will accelerate. There is still so much to do in the UK but we do want to be a global brand.
It sounds like there are significant growth plans in place. What is NBTY Europe’s growth strategy?
NBTY has a three-year plan which focuses on five pillars - improving the core estate through product, ranging and the store of the future; the expansion in our domestic sites across Ireland, the UK, Holland and Belgium; driving GNC to be a digitally-led brand; international expansion and international franchising.
The catalyst is the new technology that we’ve put in place.
We have a 700-store estate in the UK so there are not hundreds of stores that we can open here. But there are still locations we want to be in. We want bigger stores. Manchester is a 2,700 sq ft store from an original 900 sq ft store. But we would only do that in the bigger cities and towns