27 Nov 2013

Pharmacy Brands lifts profit but rues mild winter

6:58 am on 27 November 2013

Pharmacy Brands lifted first-half net profit more than 17%, largely reflecting acquisitions, improved profit margins and cost control.

The company, which owns the Unichem, Life Pharmacy and other retail chemist brands, made a net profit of more than $7 million for the six months to September compared with a profit of $6 million in the same six months last year.

Executive chairman Peter Merton said improved efficiences in the company's pharmacy stores and good results from previous acquistions were where the profit growth was coming from.

The difficulties it faced were competition from other bricks and mortar retailers in health and beauty, such as supermarkets and department stores, online shopping and the economy.

"I suppose we like to blame the general economy rather than just the competitors as well but that hasn't been that strong for us during this reporting period," Mr Merton said.

A mild winter had also had an effect, as "cough-cold" was a big part of the business.

"Those allied products that people take when they've got a cold or the flu, and that just didn't materialise this winter," he said.

The decision to focus on the Life and Unichem brands and to phase out the Care, Radius and most of the Amcal-branded stores was based on customer surveys.

Pharmacy Brands represented 301 retail outlets, including 74 pharmacies it owned, and it also owned stakes in 11 Radius Medical Centre companies.