Q1: Lower result at Pharmacies Netherlands - Further growth of sales and result at Direct & Institutional
Financial highlights
Net sales - Up 1% to € 654.3 million due to growth at Direct & Institutional; decrease at Pharmacies Netherlands and Pharmacies Poland.
EBITA from ordinary activities 2 - Down 10% to € 27.2 million due to decrease of € 4.4 million at Pharmacies Netherlands; EBITA at Direct & Institutional up 10%.
Net result - Down 21% to € 13.9 million due to lower EBITA and higher amortisation of customer relationships.
Net result per share from ordinary activities - Down 6% to € 0.30 due to lower EBITA from ordinary activities, partly compensated by a lower number of shares outstanding.
Cash flow - Cash flow from operating activities up significantly, to € 46.1 million, mainly due to improvement of working capital.
Outlook 2012 - Where we previously expected a decrease of EBITA at Pharmacies Netherlands compared to 2011, we now expect that decrease to be substantial.
The outlook for D&I and Pharmacies Poland is unchanged; at both segments we expect an increase in EBITA.
Operational highlights
Direct & Institutional
− Sales growth of 14% driven by acquisitions. Organic decrease of 3% due to decrease of biopharmaceuticals in the Netherlands, as announced previously. Excluding this effect, organic growth was 2%.
− EBITA margin from ordinary activities of 8.6%; lower than expected due to acquisition costs and start-up costs at the new distribution centre in Sweden.
− Acquisition of Diabetes Specialty Centre in the USA gives access to growth market of insulin pumps, continuous glucose monitors and accessories for diabetics who depend on insulin and consequently frequently use medical devices.
Pharmacies Netherlands
− Decrease in sales and EBITA due to lagging volumes, price pressure and higher costs; market conditions deteriorated.
− Review started of the cost structure and operational strategy of our pharmacy activities.
Pharmacies Poland
− Sales decrease of 12%, of which 6% due to depreciation of zloty and 6% organic due to hoarding effect in December 2011.
− Decrease of EBITA from ordinary activities as a result of sales decrease.
Marc van Gelder, CEO:
“This was a very challenging quarter for Mediq. The effects of liberalisation of the pharmacy market led to lower sales and higher costs than expected. We continue to favour the market liberalisation. Being the largest chain we are better positioned than many other players. However, it is clear that these results cannot remain without consequences. But I am convinced that, after a thorough analysis, we will take the measures that are necessary to strengthen our Dutch pharmacy activities.The quality of our services for patients continues to have the highest priority.
The underlying trends at Direct & Institutional remain strong. Sales increased particularly for homecare activities in the Netherlands and the USA (excluding diabetes) and deliveries to healthcare institutions and professionals in Sweden, Finland, Norway and the Baltic states. Although the margin was lower than expected, this was a consequence of one-off costs. Therefore, we reiterate the guidance given previously of an EBITA margin for Direct & Institutional of between 9 and 10%. The integration of recent acquisitions, including Assist, is on track.”