Restructuring costs relating to end of My Chemist/Chemist Warehouse contract hit overall Sigma results.
Sigma Healthcare has just released its financial results for the six months to 31 July 2019, with a Net Profit After Tax of $2.86 million – compared to a $13.77 million result for the previous corresponding period.
The company’s “Reported EBITDA” was $25.3 million, down about 20%, with CEO Mark Hooper saying the results were in line with expectations.
“Sigma’s fundamentals remain in strong shape as we continue to implement the changes to deliver sustainable benefits for our business medium to longer term,” he said.
Sigma’s pharmacy brands achieved like-for-like growth of 7.8%, while Sigma Hospitals grew 23% in sales for the six months, excluding Hepatitis C medications.
In the current period, net expenses of $12.4 million resulted from restructuring, litigation and due diligence – largely due to redundancies because of the cessation of Sigma’s contract with the My Chemist/Chemist Warehouse Group.
Hooper said one-off costs also related to the company’s Project Pivot transformation program, which will see benefits flow in the forthcoming years.
Excluding Chemist Warehouse and Hepatitis C, revenue from Sigma’s ongoing business was up 6.9%, with Hooper also noting that while the delivery of Scheduled medicines for Chemist Warehouse transitioned as planned on 01 July, “the transition of FMCG supply was delayed as a result of issues with the new service provider”. That meant Sigma continues to supply some FMCG products to Chemist Warehouse, a situation expected to continue until next month.
Hooper said Sigma was “entering a growth phase where we have few business constraints. Our sales and pharmacy banner pipelines are strong, and our investment cycle is delivering and efficient and effective Distribution Centre network with signifgicant capacity and capability to better service our customers”.”
He said Project Pivot meant Sigma remained on track to achieve the forecast $100 million+ efficiency gains.
More details in tomorrow’s issue of Pharmacy Daily.
