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Sigma expects earnings to fall in FY22

Pharmacy network Sigma Healthcare is expecting its annual earnings to fall around 10 per cent during FY22, reflecting what it expects will be a “challenging” second half.

Sigma, which counts Guardian, PharmaSave, and Amcal pharmacies among its network, said with 10 months of the financial year complete it is expecting its result to be impacted by some “short-term operational issues”, including a new Enterprise Resource Planning system.

“Whilst we reached the go-live on this project broadly on budget and on time through a pandemic, we have faced additional challenges in the context of completing implementation through the height of Covid-19 restrictions,” said interim chief financial officer Jeff Sells.

Due to the impact of switching this system, the business is expecting operating costs to jump to around $25 to $30 million.

However, Sells said the cost involved should be largely confined to FY22, and the impact should abate as the business progresses through FY23.

“Sigma has undertaking an extensive transformation program over the past four years that puts the company on a strong footing for our incoming CEO Vikesh Ramsunder to execute our strategy,” said chairman Ray Gunston.

“We remain focused on growing our core business, whilst continuing to build on business expansion opportunities across areas such as Hospital Services, Contract Logistics, and medical devices and consumables, and to leverage our strategic advantage across our automated DC network.”

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