Losses widen at pharma firm Munro Healthcare

PHARMACEUTICALS business Munro Healthcare Group saw pre-tax losses increase by more than seven times in the year to the end of March as concerns over the UK’S impending departure from the European Union continued to prove a drag on performance.

The East Kilbride-based company, parent to businesses including Strathclyde Pharmaceuticals and Swedenbased Medartuum, saw overall revenues fall by 21%, from £153.2 million to £144.6m, while pre-tax losses increased from £98,602 to £718,472.

Within that, drugs wholesaler Strathclyde Pharmaceuticals, which is also based in East Kilbride, saw turnover drop from £46.1m to £41.8m (9%) over the same period while its pre-tax loss widened from £394,681 to £575,603 (46%).

Writing in Munro’s accounts, which were filed at Companies House this week, managing director John Cochrane said market conditions for the business and its subsidiaries had “remained challenging due to the volatility of exchange rates with the pound to euro for UK business and euro to Swedish krona for our Swedish business”.

“Uncertainty of Brexit and [the] introduction of new EU regulatory requirements has made trading more difficult,” he said.

“Brexit remains a big concern for the business as a large proportion of our business is conducted in the EU and will continue this way until all concerned have a clearer picture of the impact once resolved.

“The group has sufficient resources to see through this difficult period and the directors remain confident that the business will return to profitability once the market conditions have stabilised.”

Mr Cochrane noted that the business was looking to reduce costs as a result of the dip in trading.

During the year headcount at the group level fell from an average of 197 to an average of 171, with the majority of those employed by Strathclyde Pharmaceuticals, where headcount fell from 144 to 117.

Despite this, staff costs at the overall group increased from £5.8m to £5.9m year on year, although at Strathclyde Pharmaceuticals the overall bill, which includes salaries and pensions, fell from £3.2m to £2.6m.

The group was founded in 1959 by Donald Munro, who sold the eponymous chemist chain to Lloyds Pharmacy in 2008.