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EBO.AX: EBOS Group (ASX:EBO), the New Zealand-based healthcare and pet products company, is moving forward with renewed confidence after a successful year. Despite a failed attempt to acquire Greencross in late 2023, EBOS has reported record sales and profits for the year ending June 30.
The company's statutory net profit increased due to strong sales, which reached a new high of NZ$13 billion. However, this will be the last time EBOS reports such a large figure, as its supply deal with Chemists Warehouse ended on June 30. While the loss of this wholesale business will have an impact, the company expects minimal growth in earnings for the current financial year.
EBOS operates in two main retail channels: supermarkets for pet care products and chemists and wholesalers for healthcare. Its most well-known healthcare businesses are Terry White Chemists and Symbion. The company's attempt to acquire Greencross was motivated by the loss of sales revenue to Chemists Warehouse.
On Wednesday, EBOS reported a 7.2% increase in statutory net profit after tax to NZ$271.5 million. Revenue grew by nearly 8% to NZ$13.2 billion, and EBITDA increased by 6.5% to NZ$605.6 million. However, the company anticipates a decline in EBITDA due to the loss of the Chemists Warehouse supply deal.
The Christchurch-based company declared a final dividend of 61.5 NZ cents per share, bringing the total dividends to 118.5 NZ cents.
EBOS attributed its record sales to growth in its community pharmacy and institutional healthcare divisions. The company highlighted strategic investments, including its stake in Transmedic, the acquisition of Superior Pet Food, and smaller acquisitions in medical technology and consumables.
"The group's diversification is a key strength as we navigate challenging domestic economic conditions," said EBOS CEO John Cullity. "We have a strong pipeline of opportunities ahead as we continue to expand our operations outside New Zealand and Australia."
A significant factor for EBOS is the ongoing merger of Chemists Warehouse and Sigma Healthcare. The ACCC is likely to require the merged group to divest certain assets, particularly in wholesale and chemist retail outlets. This could present opportunities for EBOS to expand its businesses in Australia, potentially offsetting the loss of revenue from the Chemists Warehouse supply arrangement.
