Walgreens Boots Alliance has reported a drop in its fourth-quarter sales and profits exacerbated by a plunge in demand across the group’s UK arm.

WBA recorded a 26% drop in operating income to $650m (£503.3m) in the quarter to August 31, while sales increased 2.3% to $34.7bn (£26.9bn).

The UK division, which comprises Boots, registered a 29.2% decline in like-for-like sales, which the retailer attributed to a significant fall in footfall to its major high street, train station and airport locations due to Covid-19. The retailer said footfall during the period has registered a gradual improvement in comparison with the third quarter.

Boots’ market share declined across all categories except for beauty as the “pandemic continued to impact heavily on buying habits and consumers temporarily shifted purchasing to one-stop grocery shopping”.

Boots online sales jumped 155% during the period but this was insufficient to offset an overall decline of 16.7% in sales across the business overall. 

Across WBA’s international division overall, adjusted gross profit fell 25.7% “reflecting lower UK retail sales, higher fulfilment costs, marketing investments to drive customer traffic and lower fixed supplier contributions”.

Sales in the US were up 3.6% to $27bn (£20.9bn). Retail like-for-like sales increased 4.7%, while online sales rose 39%.

Executive vice chair and chief executive Stefano Pessina said: “I am pleased to report results that came in at the high end of our expectations as we continue to adapt and transform our business model to changing customer needs. Despite uncertainty amid the global Covid-19 pandemic, we are seeing a gradual improvement in key US and UK markets and continued strong performance in our wholesale business.

“I’m also encouraged by the accelerating growth in our ecommerce platforms. Now, more than ever, our pharmacy-centred business is at the heart of community healthcare and we are expanding on that role for the future.”