Chemist Warehouse, TWC credited in EBOS ‘record’ results

Community pharmacy revenue across both Australia and New Zealand rose by $1.4 billion due to significantly increased volumes

EBOS Group has reported strong revenue growth in its full-year results despite being what Chair Elizabeth Coutts described as an “extremely challenging year”.

On Thursday the company has reported $8.8 billion in total revenue for the 2020 financial year, up 26.5%. Underlying EBITDA was $296.6 million, up 13.4%, with underlying Net Profit after Tax (NPAT) at $168.3 million, up 16.5%.

In Australia, healthcare revenue increased by $1.7 billion (+33.1%), largely driven by a strong boost in community pharmacy sector.

EBOS reports that its community pharmacy revenue across both Australia and New Zealand increased by $1.4 billion (+37.4%) due to “significantly increased volumes”.

Community pharmacy benefited from “unprecedented demand” during March 2020 as consumers stockpiled ethical and over-the-counter (OTC) products, explained the group.

However sales were impacted by generally lower foot traffic during April and May, as well as consumers running down supplies built up during earlier stockpiling.

“The business benefited from commencement of the wholesale distribution of the Chemist Warehouse volumes from 1 July 2019 in Australia, as well as the improved performance from our TerryWhite Chemmart (TWC) franchise network partners,” EBOS said, adding that the TWC franchise had risen to the challenges of COVID-19.

Its initiatives included launching an integrated delivery system, working with local medical centres to enable scripts resulting from telehealth consultations and launching e-commerce solutions to support remote shopping and click-and-collect services.

“During these challenging months for teams and patients, TWC pharmacists administered over half-a-million influenza vaccinations. TWC grew its network by 26 pharmacies during FY20 and increased pharmacy sales on a like-for-like basis by 4.1% and prescription sales by 6.0%,” said EBOS Group.

Meanwhile it also highlighted the importance of the 7CPA to its outcomes through providing regulatory certainty for its community pharmacy business.

“EBOS’ subsidiary, Symbion, is the largest Community Service Obligation (CSO) wholesale distributor. The new arrangements provide additional investment into the CSO funding pool and introduce a restructured wholesale mark-up for PBS medicines, albeit this is expected to be largely offset through ongoing PBS pricing reforms,” it said.

Mr Cullity added: “We are pleased that, through [the 7CPA], the Government has recognised both the vital role of retail pharmacy in meeting the community’s health needs as well as the critical role all CSO wholesalers play in ensuring the timely distribution of medicines across Australia.”

“It is pleasing to report on the 2020 financial year with a record financial result for EBOS,” he said on the overall results, which were supported by further strong performances in its institutional healthcare, contract logistics and animal care businesses.

“As a provider of essential healthcare and consumer products and part of the region’s critical medical supply chain, we have remained operational throughout the COVID-19 pandemic and have continued to serve our customers and provide employment to our employees. EBOS has market leading positions in stable, defensive industries and has a strong balance sheet. These attributes have held us in good stead during these times.”

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