The pharmacy sector faces a major inflationary challenge and a shortage of pharmacists, pharmacy chain Sam McCauley chairman James Tolan has warned.
We also said that the state must address its relationship with the sector or risk the number of pharmacies shrinking.
His warnings come as the chain is being orbited by Irish Stock Exchange-listed group Uniphar in a likely takeover move.
Newly filed accounts for Sam McCauley’s business show that it continued to post losses over the most recent fiscal year.
In the 12 months to the end of September last year, the company made a pre-tax loss of 1.6 million euros, compared to a loss of 3.1 million euros a year earlier.
“The pharmacy retail sector is currently facing very significant inflationary challenges as well as a growing shortage of pharmacists,” Mr Tolan said in the accounts just filed for the Sam McCauley chain, signed last month.
“The pharmacy retail sector is unique in that it is the only healthcare provider that has not seen an increase in the rates at which it provides services on behalf of the government for over 10 years,” he added.
“If the state continues to take a non-strategic approach in its relationships with pharmacy retail, there will be fewer pharmacies and shorter hours over time,” Mr Tolan said.
Despite an operating loss of €346,000 reported by the Sam McCauley chain in the 12 months to the end of September last year, its earnings before interest, taxes, depreciation and amortization (Ebitda) reached €4.5 million over the period. That was more than the 4 million euros that the directors had expected.
Sam McCauley is the third largest pharmacy chain in Ireland with 37 branches across the country. Sam McCauley joined the family group in 1978 and expanded it over the following years. In 2017, investment group Cardinal Carlyle Ireland took a majority stake in the company for more than €50 million.
In the 2020 financial year, the shareholders injected €3 million in fresh capital into the pharmacy business.
That Sunday independent reported last weekend that the listed Uniphar is aiming to take over the chain. The newspaper said Uniphar beat out competition from Dunnes Stores and SuperValu owner Musgrave to take pole position in sales talks.
The sector remains challenged in the wake of the pandemic as the Sam McCauley chain cut 100 jobs.
Accounts filed for the Sam McCauley Business Show just this week were down 3 percent to €80.4 million in the year to the end of September. Gross margin increased 1.3 percentage points to 40 percent.
“Given the impact of the Covid-19 pandemic on the global economy and Ireland in particular, the Directors are pleased with the way business has performed over the year,” the statement read.
They insisted the chain was “well positioned” to weather the ongoing microeconomic challenges.
Mr. Tolan said in the accounts that the company continued to invest in its operations, further acquisitions and in its online offering.
https://www.independent.ie/business/irish/pharmacy-sector-facing-decline-amid-challenges-warns-sam-mccauley-chairman-41924388.html The pharmacy sector is “heading for decline” amid challenges, Sam McCauley chairman warns