- Australian Pharmaceutical Industries (API) is closing 14 of its non-pharmacy Priceline stores due to the impact of COVID-19 on its retail business
- The company cited the long-term impacts of the pandemic on foot traffic in CBDs, coupled with the ongoing cost of rental payments as justification for the closures
- The closures and associated restructuring costs, when combined with other costs already incurred during the pandemic, are expected to reach $9.4 million and will be reported as underlying adjustments
- The news comes ahead of the company’s full 2020 financial year report, which is expected to go public on October 22
- Despite the closures, the company’s full-year underlying net profit after tax is still expected to be inline with its previous guidance of between $30 and $31 million
- Today, API shares are up a slight 0.91 per cent, worth $1.07
Australian Pharmaceutical Industries (API) is closing 14 of its non-pharmacy Priceline stores due to the impact of COVID-19 on its retail business.
The company cited the long-term impacts of COVID-19 on foot traffic in CBDs, coupled with the ongoing cost of rental payments, as justification for the closures.
The news comes ahead of the company’s full 2020 financial year report, which is expected to release on October 22.
The closures and resulting restructuring costs, when combined with other costs associated with the pandemic, are expected to hit $9.4 million and will be recorded as underlying adjustments.
The company will also write down a carrying value of $37.5 million associated with its Soul Pattinson Chemist brand, as well as $5.5 million in inventory write downs.
Despite the hindrances noted above, the company’s full-year underlying net profit after tax is still expected to be between $30 and $31 million, which remains in line with previous estimates.
API CEO and Managing Director Richard Vincent remains confident about the company’s underlying financial performance.
“The underlying NPAT and our strong balance sheet show that we are successfully executing our strategic priorities to deliver sustained shareholder value,” he said.
Turning to the current lockdowns, the company currently has 14 Clear Skincare Clinics and 22 Priceline company-owned stores temporarily closed in Victoria, which are expected to reopen once restrictions allow.
Richard went on to outline the positive upward trend in demand that the company expects once the clinics reopen.
“Where we have re-opened Clear Skincare clinics after mandated shutdowns, pent-up demand has been significant, with comparative sales up 25 per cent on pre COVID-19 levels, followed by a sustained uplift,” he added.
Today, API shares are up a slight 0.91 per cent, worth $1.07 at 10:40 am AEDT.