Rowlands has seen pre-tax profits increase by 102%, rising from a loss of £37.9m in 2023/24 to a profit of £637k in 2024/25, company accounts for the year ending January 31 2025 have revealed.
Published on Companies House this week (October 8), the document showed the company’s turnover rose by 27%, jumping from £410m in the year ending January 31 2024 to £522.5m at the end of this January.
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Directors said along with Rowland’s “improved trading performance”, a “reduction” in the number of branches “compared with the prior year” had helped reduce “distribution costs”.
“Interest costs have also reduced due to intercompany loans no longer bearing interest,” the document said.
It also noted the increase in turnover was “primarily driven by the company successfully novating agreements with over 26 NHS trusts” as well as expanding operations to “46 new Outpatient Pharmacy Department (OPD) dispensary sites”.
Rowlands managing director Nigel Swift described this development as a “key milestone” for the company, noting that it makes Rowlands “the market leader in outpatient dispensing services”.
It remains unclear how many of these NHS trust contracts are new.
Execution
The accounts also attributed “continued execution of the over-the-counter (OTC) and services strategy” to “higher sales across both revenue streams”.
And the company said it had “invested in branch refurbishments” to “improve accessibility to a range of healthcare services and products in the local communities” as part of its “ongoing estate strategy”.
The strategy also aimed to “encourage colleagues in pharmacies to spend more time interacting with customers”, it added.
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The annual report also noted an 8% decrease in the average number of employees, dropping from 3,245 in 2023/24 to 2,996 in 2024/25.
It said this was part of the company’s “strategic divestment of the pharmacy branches and structural changes to the operational team to support the core business operations”.
In terms of “key risks and uncertainties” for the company, it stressed the “government changes to the pharmacy remuneration structure – such as the Category M mechanism or adjustment to fees paid for dispensing services – have a direct impact on the profitability of the business”.
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Rowland’s is also currently involved in an “industry-wide challenge by HMRC on the self-employed status of locums, which is expected to be a lengthy process”, it added.
“The company is in direct communication with HMRC over the extent of its liabilities,” it said, noting that it believes that locums are “self-employed individuals” and are “accounted for on this basis” with “no provision being made for National Insurance contributions or income tax”.
Swift said that the company has “continued to make good progress over the past year” as it focuses on “supporting the long-term sustainability of [its] pharmacies”.
“The improvement in our financial position reflects the success of our ongoing transformation strategy, investing in our people, modernising our estate, and optimising our dispensing and retail operations,” he said.
“While the community pharmacy sector continues to face significant financial pressures, these results demonstrate the resilience of our teams and our commitment to providing high-quality care to patients and communities across the UK,” Swift added.
