Sam McCauley Chemists bemoans HSE drug price cuts
Company had debts at end of year of €17.5m, which was more than €3m lower than 12 months previously
The company said it had launched a new drug distribution business this year to diversify away from its core business of operating chemist shops. Photograph: PA Wire
Profits before tax at Sam McCauley Chemists, one of the largest chains in the country with 28 outlets and 570 staff, halved last year as the chain struggled with HSE price cuts and declining margins.
The company retained profits of €180,000 on sales of €78 million, after paying a dividend of €1 million to its shareholders, including the Wexford-based McCauley family, who founded the chain 60 years ago.
The group’s directors said it had a strategy of “paying down debt in tandem with prudent expansion”, including two new stores last year in Carlow and Cavan.
It had debts at the end of the year of €17.5 million, which was more than €3 million lower than the figure 12 months previously.
Drug distribution business
The company said it had launched a new drug distribution business this year to diversify away from its core business of operating chemist shops, which it said was hit by weak consumer spending. Sales were down 3 per cent on 2011.
The company also took a hit of more than €3 million after writing down the value of its shops. Most of its outlets are located in the south Leinster region, although it also has stores in Dublin and Border counties.
The group’s balance sheet appears to be strong enough to cope with the downturn. Sam McAuley has retained profits of more than €16 million.