Stefano Pessina this week promised to invest in Alliance Boots for the long term as he revealed a sparkling year for the health and beauty business which he took private in June last year.

Group trading profit soared 20.1 per cent to£854 million in the year to March 31, on the back of revenues up 6.3 per cent to£17.8 billion. EBITDA jumped 17.8 per cent to£1.1 billion.

Revenue at the health and beauty business, including its UK retail arm, was up 4.2 per cent and trading profit climbed 20.1 per cent to£603 million. UK like-for-likes rose 3.6 per cent.

Pessina – who confirmed plans to relocate Alliance Boots’ headquarters to Switzerland – told Retail Week that he was committed to Boots for the long term and would continue to invest heavily in the business as he has since he teamed up with KKR to buy the group last year.

“I expect KKR to be here for the long term and me to be here for even more,” he said. “I have never sold one share in a wholesale or healthcare business and I have no intention of doing so.”

Pessina said£470 million had been invested in the business in the past year,£280 million of it on updating the existing stores and the company’s organisational structure. “The stores had been underinvested for decades,” he said. He said that 800 smaller Alliance Pharmacy stores will be rebranded to the Boots fascia.

£184 million has been invested in acquisitions, including 108 pharmacies in the UK and a stake in a Chinese wholesaling joint venture.

Pessina said£68 million cost synergies had been achieved, ahead of the planned schedule of£60 million by this July. He added that rationalising processes in the business had helped drive the strong growth in profitability.

He defended the company’s imposition of tougher terms on suppliers, saying they had enjoyed an easy ride for too long. “People are complaining of course, but this is a normal commercial discussion,” he said. “Boots has always been very gentle and very relaxed with its suppliers.”

Pessina confirmed plans to expand Boots’ established brands such as Soltan and No 7 into international markets.

He stressed this would take advantage of Boots’ wholesale network, whereby it supplies 130,000 pharmacists with deliveries every day. He said that a dedicated team is looking at how to sell these branded products into foreign markets.

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