Chemist gets a prescription for profits
Pharmacy giant Chemist Warehouse has more than doubled its first half profit ahead of a proposed merger with ASX-listed Sigma Healthcare, as public consultation on the deal draws to a close.
Sigma, which reported its full-year profit on Thursday, said it expected the Australian Competition & Consumer Commission to make a ruling on the proposed merger in the second half of the year.
The ACCC is accepting public submissions on the deal until March 28, and Sigma managing director Vikesh Ramsunder said his company was in regular communication with the regulator.
The Chemist Warehouse first-half results were included in the Sigma results briefing on Thursday. The pharmacy group, owned by founders Jack Gance and Mario Verrocchi and their respective families, increased revenue 5.5 per cent over the first half to $1.77bn, while net profit was $360.1m, up 104 per cent.
Chemist Warehouse added nine stores to its Australian network, and nine internationally.
For its part Sigma boosted its full year net profit to a modest $4.5m, up about 150 per cent on the previous year’s result, on revenue of $3.32bn, down 9.2 per cent.
Stripping out merger costs to date, Sigma’s EBIT of $31.4m was up 62.7 per cent and net profit came in at $12.7m. The company said its two year transformation process had resulted in a much-improved business.
“Customer service performance metrics are now sustained at world class levels,’’ Sigma told the ASX.
The company said the fall in revenue largely reflected the disposal of its hospital distribution business during the year.