Priceline to shut 14 stores on falling foot traffic
Australian Pharmaceutical Industries will shut 14 Priceline stores across the country due to the impact of falling foot traffic in shopping centres and CBD locations, and ongoing cost of rent.
The stores in question are not licensed pharmacies, which typically receive additional customers from doctors and other dispensaries, and will result in a net reduction of the business’ upcoming FY20 result by $9.4 million.
API expects a full-year NPAT of between $30 and $31 million.
The business is also writing down the carrying value of the Soul Pattison Chemist brand by $37.5 million, and completed an inventory review to find stock that could be cleared – likely to impact NPAT by a further $5.5 million.
“While these two adjustments are necessary at this time, the underlying NPAT and our strong balance sheet show that we are successfully executing our strategic priorities to deliver sustained shareholder value,” said API CEO and managing director Richard Vincent.
“Priceline company stores and Priceline Pharmacies are also trading strongly compared to the same period last year in those states where Covid-19 restrictions have been lifted.”
According to Vincent, Priceline’s online sales have more than doubled, though admits this is “from a low but growing base” level.
API still has 36 stores closed in Victoria – 14 Clear Skincare clinics and 22 Priceline stores – which will be re-opened on 2 November.