DGAP-News: Celesio AG / Key word(s): Final Results
Celesio AG: Celesio pushing forward with earnings stabilisation and
strategic realignment
27.03.2012 / 10:00
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Celesio pushing forward with earnings stabilisation and strategic
realignment
* Result to be stabilised in 2012 at the level of the previous year.
Operational Excellence Programme will contribute significantly towards this
* Sales process for Movianto, Pharmexx and DocMorris mail-order business
initiated
* 2011: Earnings forecast with 578.3 million euro EBITDA before one-off
effects achieved
Stuttgart, 27 March 2012. With a profound strategic realignment, Celesio
set course for the stabilisation of earnings and a return to profitable
growth in the second half of 2011. 'The first concrete steps of the
realignment were the withdrawal from the joint venture with Medco and the
purchase of the Brazilian company Oncoprod - both in 2011,' stressed
Chairman of the Management Board and CEO at Celesio, Markus Pinger, at the
company's press conference on annual results today. 'With the initiation of
the sales process for Movianto, Pharmexx and DocMorris we have now taken
further portfolio decisions for our realignment.' An important part of the
new strategy is the Operational Excellence Programme, which was started in
2011. This is intended to stabilise the development in earnings in 2012 and
achieve earnings at the same level as the previous year. With an operating
profit of 578.3 million EBITDA before one-off effects, Celesio fulfilled
its earnings forecast of November 2011 in the 2011 fiscal year.
'In the short term we are placing a high priority on turning around the
development in earnings,' emphasises Celesio CEO Markus Pinger. 'That means
that in 2012 we want to concentrate on our homework and stabilise our
earnings development. We want to achieve earnings that are at least at the
level of the previous year. This is the prerequisite for the successful
implementation of our realignment and for profitable growth. That is the
reason why in the past few months we have pushed forward with the
Operational Excellence Programme as part of our strategic realignment. This
should provide positive earnings contributions in the short term while
contributing to a sustainable improvement in competitiveness over the long
term.'
Operational Excellence Programme will show its full effects from 2013/2014
on
The Operational Excellence Programme essentially comprises:
* the groupwide bundling of procurement activities:
* the strengthening of the market position in Sweden, where Celesio started
with the opening of new pharmacies in 2010.
* the optimisation of the international logistics network.
* the reduction of administration costs at the six major administrative
centres of Celesio and its foreign subsidiaries.
The Operational Excellence Programme will already make a significant
contribution to improving earnings in the second half of 2012. Pinger:
'From 2013/2014 on it will then unfold its full impact and result in annual
savings of approximately 50 million euro.' Overall, in conjunction with the
implementation of the Operational Excellence Programme, the company is
expecting one-off effects of up to 100 million euro. Of this, 80.6 million
has already been included in the balance sheet of the fiscal year that has
just ended.
Strategic realignment geared towards mega-trends in the healthcare market
The strategic realignment introduced in 2011 focuses on three social
mega-trends in the healthcare sector: an ageing population with growing
medical needs, rising per capita expenditures for health and the
development of effective healthcare systems in the emerging and developing
countries. Besides the Operational Excellence Programme, the strategic
realignment therefore also comprises the following cornerstones:
* Focusing on the core business. Under the keywords 'end-to-end supply
chain' the expansion of logistics expertise is planned for the entire
value-added chain: from the logistics of the manufacturers to the warehouse
management of the pharmacy. The aim of this is to achieve efficiency
advantages and growth.
* Development of a European Pharmacy Network, in which all of the company's
own pharmacies and all of todays and future cooperation pharmacies are
bundled. Through such bundling the goal is to develop and implement
innovative pharmacy concepts more quickly. Furthermore, economies of scale
advantages in the field of purchasing and marketing should also be achieved
for owner-managed pharmacies. As a result, Celesio will develop into a
preferred partner for pharmacies in an environment which is also
characterised by liberalisation. The objective is increasing market shares
- and, as a result, higher revenues and earnings.
* Regional expansion: Starting from the leading market position in Brazil,
the market entry in other Latin American countries is to be examined. In
the medium-term the Middle East region is considered to be promising.
Overall, regional expansion should make an important contribution to future
growth.
* Review of the Manufacturer Solutions division as a consequence of the
strategic focusing on the core business.
Schedule 2012 to 2014: stabilisation, realignment, growth
Pinger: 'We have designed our schedule for the next few years in line with
our priorities: stabilisation in 2012, realignment in 2013, growth from
2014 on. 'In addition to the implementation of the Operational Excellence
Programme and the stabilisation of earnings, in the 2012 fiscal year the
concepts for the growth topics of the end-to-end supply chain, European
Pharmacy Network and regional expansion are to be finalised. Pinger: 'With
the introduction of the sales process for Movianto, Pharmexx and for the
DocMorris mail-order business, we are also in the process in 2012 of
completing the review of the Manufacturer Solutions division. In the case
of the DocMorris mail-order business in particular, we are fulfilling our
commitment to solving the conflict with our customers, the independent
pharmacists.'
In the 2013 fiscal year the focus will then be on the practical
introduction of the growth concepts of the end-to-end supply chain and
European Pharmacy Network through pilot projects. In addition, the
Operational Excellence Programme should unfold its full impact on profits.
The broad roll-out of the growth concepts is envisaged for 2014. Besides
the end-to-end supply chain and the European Pharmacy Network, the regional
expansion will then be pushed forward more energetically and purposefully.
Dividend Proposal for 2011
'We are convinced of the success of our strategy,' underlines Celesio CEO
Markus Pinger.
The Management Board and Supervisory Board will propose to the Annual
General Meeting in May 2012 that the dividend, on the basis of net profit
adjusted for one-off effects, for the 2011 fiscal year should be 0.25 euro
per share, thus guaranteeing continuity in dividend payments and a
distribution which is appropriate with regard to the economic situation of
the company.
2011 Fiscal Year: Revenue and Earnings Development
In the 2011 fiscal year the operating profit (EBITDA), adjusted for one-off
effects, was 578.3 million euro. Including one-off effects, the operating
profit (EBITDA) in the 2011 fiscal year was 514.8 million euro. Group
revenue fell slightly by 1.1 per cent to 23.0 billion euro.
Earnings before interest and taxes (EBIT) in the 2011 fiscal year were
434.9 million euro before and 236.8 million euro after impairment losses
and one-off effects. Earnings before taxes fell to 323.3 million euro
before and 104.0 million euro after impairment losses and one-off effects.
The Patient and Consumer Solutions division generated revenue totalling 3.6
billion euro (minus 1.3 per cent) in the 2011 fiscal year. Adjusted for
portfolio and currency effects, the revenue of the division rose slightly
by 0.6 per cent. The EBITDA of the division fell to 218.6 million euro
before and 181.4 million euro (minus 42.7 per cent) after one-off effects.
The negative effects of government measures, the realignment of the British
pharmacy business and the deconsolidation of the Dutch pharmacy chain could
not be compensated for by a positive development in Germany and other
markets, or the market entry of DocMorris in Sweden.
The Pharmacy Solutions division achieved revenue of 18.8 billion euro
(minus 1.1 per cent). Adjusted for currency and portfolio effects, revenues
fell by 1.6 per cent. Negative effects were felt as a result of generally
weaker markets, government measures and the continuing competitive pressure
in France and Germany. The EBITDA of the division fell to 436.1 million
euro before and 424.4 million euro (minus 7.0 per cent) after one-off
effects. In October 2011 Celesio further expanded its international
business with the acquisition of a majority stake of 60.0% in the Oncoprod
Group, the leading distributor of specialty pharmaceuticals in Brazil.
The Manufacturer Solutions division achieved a gross profit of 383.3
million euro (minus 6.9 per cent). The EBITDA of the division fell to 4.4
million euro before and 0.4 million euro after one-off effects. The
decrease was mainly attributable to the high start-up expenses at Medco
Celesio and the declining revenues from Movianto. As already reported, the
joint venture with Medco was dissolved as of the end of September. New
contracts concluded in the second half of 2011 cannot have a positive
impact on the business at Pharmexx until 2012.
Overview of Key Figures
2010 2011
Revenue Mio. EUR 23,277.6 23,026.4
EBITDA Mio. EUR 699.2 514.8
EBITDA
adjusted Mio. EUR 699.2 578.33
Profit before tax Mio. EUR 409.3 104.0
Profit before tax
adjusted Mio. EUR 454.0 323.31,2,3
Net profit 265.0 6.1
Net profit
adjusted 309.1 204.51,2,3
Earnings per share
undiluted in Euro 1.52 0.01
Earnings per share
undiluted
adjusted in Euro 1.78 1.181,2,3
1 Adjusted for special effects included in the financial result.
2 Adjusted for impairment losses on intangible assets; these comprise
impairment losses of goodwill and trading names and - in the case of the
net profit - the resulting tax effects.
3 Adjusted for one-off effects, especially from the Operational Excellence
Programme (including tax effects).
Press contact
Dr Jens Schreiber, Celesio AG, +49 (0)711.5001-380
media@celesio.com
Rainer Berghausen, Celesio AG, +49 (0)711.5001-549
media@celesio.com
About Celesio Group
As a leading international trading company and provider of logistics and
services in the pharmaceutical and healthcare sector, Celesio takes a
proactive and preventative approach to ensuring that patients receive the
products and support that they require for optimum care. We are active in
27 countries worldwide and employ approximately 47,000 employees. Every
day, we serve over 2 million customers - at 2,200 pharmacies of our own and
4,500 participants in our brand partnership schemes. With more than 140
wholesale branches, we supply around 65,000 pharmacies and hospitals with
up to 130,000 pharmaceutical products - up to six times each day.
End of Corporate News
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Language: English
Company: Celesio AG
Neckartalstr. 155
70376 Stuttgart
Germany
Phone: +49 (0)711 5001-735
Fax: +49 (0)711 5001-736
E-mail: investor@celesio.com
Internet: www.celesio.com
ISIN: DE000CLS1001
WKN: CLS100
Indices: MDAX
Listed: Regulierter Markt in Berlin, Düsseldorf, Frankfurt (Prime
Standard), München, Stuttgart; Freiverkehr in Hamburg,
Hannover; Terminbörse EUREX
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162401 27.03.2012
DGAP-News: Celesio AG: Celesio pushing forward with earnings stabilisation and strategic realignment
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