The Jardines Pharmacy group suffered a plunge in profits of £3.1 million, its company accounts for the year ending March 30 2024 have revealed.
Published on Companies House earlier this month (May 12), the document showed that its pre-tax profits decreased by some 53%, dropping from £5,990,082 in the year ending March 30 2023 to £2,841,790 at the end of March last year.
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“The funding environment laid out by the community pharmacy contractual framework (CPCF) continues to exert significant pressure on margins, coupled with ever-increasing cost-inflationary pressures, particularly with regard to labour expenses,” it said.
“This has perpetuated extremely challenging operating conditions for the period that has coincided with significant restructuring costs,” it added, highlighting that “many” of the pharmacy acquisitions it made over the course of the year were “in distress”.
19 acquisitions
While the company suffered a significant drop in profits, it saw progress in other areas of the business with the filing stating that “the core business of community pharmacies has undergone a phase of growth”.
“There were 19 pharmacy acquisitions in this period and no divestments, resulting in a significant increase in turnover,” it said.
Based in Milton Keynes, Bedfordshire and “the surrounding areas”, the family-run pharmacy group currently has 47 branches, according to its website.
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“The exponential rise in cost pressures...means spiralling labour, energy and property costs preclude the trend of nationwide pharmacy closures, which shows no sign of abating,” the financial report said.
The document acknowledged that this gave Jardines the opportunity to “acquire distressed assets from other entities” but stressed that this “carries a degree of operation risk associated with rapid expansion”.
Directors “satisfied”
Turnover rose by 29% from £37.9m to £48.9m while the cost of sales increased by 38%, jumping from £25.9m in 2023 to £35.8m the following financial year, the document revealed.
Shareholders’ funds for the group rose from £40.6m to £42.6m, and the total number of employees increased from 272 to 361, with the number of company directors going from two to eight over the course of the year, it said.
And according to the filing, the Jardines group also owed close to £11.4m for loans, borrowing and taxation, among other things, with payments due “within one year” as of March 2024.
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The document stressed that the directors are “satisfied” with the group results “overall” and “are confident there is scope to improve operational performance through increased delivery of NHS and private pharmacy services”.
But the filing highlighted that directors believe the pharmacy contract is “grossly underfunded and unsustainable to continue in its current guise without significant cash injection to the sector”.
C+D approached Jardines Pharmacy for comment.
Read more: Local pharmacy chain launches app for Pharmacy First consultation bookings
It comes after Jardines Pharmacy announced in April last year that it had launched an app allowing patients to book Pharmacy First consultations and order repeat prescriptions.
Meanwhile, Pickfords Pharmacy revealed earlier this month that it will enter into liquidation once all assets within the company have been sold.
