Sigma builds non-PBS income
September 11, 2015
Sigma Pharmaceuticals says
its half year results confirm the
success of a strategy to diversify
the business to be less reliant on
PBS revenue to deliver growth.
Yesterday ceo Mark Hooper
revealed an 11.5% rise in revenue to
$1.67 billion for the six months to 31
Jul, with underlying net profit after
tax up 23.35% to $27.6 million.
The statutory result, an $18.9
million net profit after tax (down
15.7%), was impacted by a one-off
$7.8 million adjustment (PD 10
Aug) as a result of extra payments
to the vendors of CHS and DDS,
which have performed above
expectations.
Hooper said the Sigma business
“continues to hold a unique
position in the industry,” combining
a strong wholesale presence
with a network of 700 branded
pharmacies as well as long-term
strategic partnerships supporting
independent pharmacies.
He highlighted a range of
pharmacy initiatives launched
during the year including the Signal
data analytics tool, the Sigma
Generics Program, Sigma Financial
Services and a suite of professional
services.
“These initiatives form part of the broader Sigma Resource Centre
that collectively assists pharmacists
to compete in their local
community, providing a position of
strength to grow for our customers
and Sigma,” Hooper said.
Other developments included the
ongoing growth of Sigma’s private
label range which now extends
to over 800 products including
items exclusively available via the
company’s pact with UK group
Boots (PD 12 Dec 13).
A new CHS distribution centre in
Sydney’s Eastern Creek has been
built, and is on target for opening
late next month.
Hooper said the outlook for Sigma
was positive, with the company
continuing to broaden its revenue
base to deliver higher grade
earnings that are less reliant on
declining PBS revenues.
Non-PBS sales revenue accounted
for about 43% of the company’s
turnover, up from 40%.
Despite this, PBS income
remains important, with the 6CPA
negotiations having “delivered a
great outcome for our pharmacy
customers and provided Sigma with
the flexibility to charge in certain
circumstances to help offset the
impact of PBS reform,” Hooper said.
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