‘Challenging environment’ behind 19% Lloydspharmacy profit drop
Lloydspharmacy’s parent company has blamed a “challenging retail pharmacy environment in the UK” for a 19% drop in profits across its European business.
Adjusted operating profit for McKesson’s European pharmaceutical solutions division – which includes Lloydspharmacy and wholesaler AAH – in the three months to September was $43 million (£33.4m), a 19% drop on the same period the previous year, it said in its latest financial report published today (October 30).
This was mainly “driven by the challenging retail pharmacy environment in the UK”, McKesson said.
The latest decrease follows a 53% drop – not taking currency rates into account – for the three months to June. At the time, McKesson CEO Brian Tyler attributed this drop to “temporary, wide NHS underfunding…and to a lesser extent volume weakness”.
Growth in wholesale
Revenue for the European business was up 4%, once currency rates were taken into account, “driven primarily by growth in the pharmaceutical distribution business”, McKesson explained.
Meanwhile, revenue across the whole McKesson group increased 9% to $57.6 billion (£44.7bn) for July-September, compared to the same period last year, “primarily driven by growth in the US pharmaceutical and specialty solutions” business, the company said.
Lloydspharmacy attempted to close or sell 190 pharmacies in 2018, in an effort to cope with the funding cuts in England. C+D has since identified 78 of these branches that Lloydspharmacy has closed, and another 104 that it sold.
Announcing its 2018-19 financial results in May, McKesson said it expected to close more pharmacies across Europe.