API has reported a net profit after tax of $21.3 million for the six months to 28 February 2015.
This is above the guidance of $21.1 million provided on 4 March 2015 and up 32.1% on the underlying NPAT of $16.2 million for the prior corresponding period.
The net profit increase is attributable to growth in earnings from its core businesses, a stronger financial position and disciplined cost control, says API.
“The continued momentum in improved operational performance is delivering strong, sustainable profit for the company and a much improved balance sheet,” says API CEO and managing director Stephen Roche.
Earnings before interest and tax for the six months was up 17% on the underlying EBIT for the prior corresponding period.
Overall revenue was up 3.2% to $1.7 billion with operational expenses up 2.9% due to effective management programs to reduce costs and target spend in key areas.
“We’re generating more growth from our core assets which in turn has enabled us to strengthen our overall financial position, with reductions in average net debt, financing costs and an increase in cash generated by the business,” says Roche.
Average net debt decreased by $29.1 million, with net financing costs reduced by 26.7% to $7 million.
Cash generated by operations increased by $18.4 million, or 40% compared to the prior corresponding period and was used to accelerate the payment of debt facilities.
The oneERP project has been implemented as planned, with benefits to accrue from the next financial year.
Priceline and Priceline Pharmacy grew its store network, revenue and earnings, while sustaining store margins in line with the same period last year.
And API’s Pharmacy Distribution business delivered to expectations with recorded revenue growth up 1.4% on the prior corresponding period to $1.23 billion and gross profit also increased by 1.4%.
API expects the business momentum will continue during the remainder of the financial year.