GROWTH in market share and contributions from each of Australian Pharmaceutical Industries' (API's) Priceline Pharmacy, Consumer Brands and Clear Skincare businesses, together with solid cash generation and stable market share from the pharmacy distribution business, have boosted the company's earnings, the company reported to the Australian Securities Exchange.
The group's total revenue, excluding PBS reform impacts and hepatitis C medicines, was $4 billion, up 4.1% on the prior year.
Priceline total network sales for the period were up 2.4% to $2.2 billion from $2.1 billion in FY18, which CEO, Richard Vincent, described as "a relatively strong retail performance in persistently challenging retail conditions".
Consumer Brands reported revenue growth of 30.7% over the previous corresponding period (pcp) with gross margin at $33.3 million, up 24.7%.
Vincent said, "Throughout the year we saw growth in our expanded healthcare range and personal care category, and we introduced, among other products, a new range of vitamins.
"I am confident this division will deliver sustainable growth well into the future," he added.
Referencing the pharmacy distribution business increase in revenue of 4.2% on the pcp to $2.9 billion, Vincent explained, "We've set up our pharmacy distribution business to cope with the ongoing impacts of Pharmaceutical Benefits Scheme reform.
"It generates strong and predictable cashflows, so that we can invest for growth."
The Government's commitment to the Community Service Obligation (CSO) brings the company and shareholders certainty up until at least the end of Jun 2020, he said.
Vincent also welcomed the move earlier this year by Astra Zeneca (AZ) to reverse their direct supply decision allowing pharmacies to order the full AZ range via their full-line CSO supplier.
Clear Skincare's integration in the API is "largely complete" with revenue increasing to $45.6 million, up 20% over the pcp, reflecting the high per capita Australian consumer spend on cosmetics.
Vincent said API was focussed on delivering on its core strategy and although consumer confidence is expected to remain soft, "we continue to adjust our cost base accordingly to deliver profit growth.
"We expect that performance during the year will initially be determined by the sales through the Christmas trading period and, in the longer term, resolution of the 7th Community Pharmacy Agreement negotiations remains important."
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