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Health & Beauty

Health & Beauty

Net sales and operating result

The Health & Beauty segment increased net sales in the first half of 2019 by 4.8% to CHF 781.4 million, CHF 726.1 million of which was accounted for by the Retail Business sector and CHF 54.1 million by the Products & Brands Business sector.

The adjusted1) operating result (EBIT), that is excluding the effect of the new lease accounting standard IFRS 16, increased by 11.0% to CHF 60.3 million.

The first-time adoption of IFRS 16 additionally increased EBIT by CHF 1.3 million to CHF 61.6 million. Adjusted1) return on sales (ROS) improved 0.4 percentage points to 7.7% (first half of 2018: 7.3%). This very good development is testament, on the one hand, to the effectiveness of the ongoing efficiency improvements in the segment, which include, for example, the intensive collaboration between the the Retail and Products & Brands Business sectors, and on the other hand, to the expansion of the business activities, such as the continuing development of the pharmacy network and of the product portfolio.

Investments in the Health & Beauty segment totalled CHF 8.6 million (first half of 2018: CHF 5.4 million).

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Strong reinforcements in home care

 
 

Net sales development

The Retail Business sector increased net sales in the first half of 2019 by 4.3% to CHF 726.1 million (excluding Coop Vitality).

The number of own pharmacies as of the end of June 2019 was 353 locations (+8 compared to the end of 2018). The increase in the number of pharmacies accounted for 5.1% of the sales increase. On a comparable basis, the sales performance was slightly negative at -0.7%, as it was not possible to fully offset the effects of the federal price reduction measures introduced in 2018. The government-mandated price reduction measures for medications had a negative impact of 1.9% on sales growth. Excluding these price reductions, organic growth (excluding expansion effects) would have amounted to a pleasing 1.2%. Generic substitution, which is actively promoted by Galenica, also curbed sales because of the lower medication prices.

By way of comparison, medication sales (Rx and OTC products) in the Swiss pharmacy market as a whole declined by 2.1% over the same period (IQVIA, Pharmaceutical Market Switzerland, first half of 2019). Sales of other products (non-medications) declined only slightly by 0.4% (IQVIA, Personal, Patient Care and Nutrition, first half of 2019).

Top position in the Swiss consumer healthcare market expanded

 
 

Net sales development

The Products & Brands Business sector, which mainly comprises the business activities of Verfora, posted net sales of CHF 54.1 million, a pleasing rise of 11.1% compared to the prior-year period.

Products & Brands increased net sales in the Swiss market by 13.6% to CHF 42.4 million, thereby exceeding growth of 0.1% in the Swiss consumer healthcare market (IQVIA, Consumer Health Market Switzerland, first half of 2019). Thus Verfora, which became the number one company in the total Swiss consumer healthcare market in the third quarter of 2018, was able to successfully further expand this position in the period under review (IQVIA, Consumer Health Market Switzerland, first half of 2019).

Export sales were CHF 11.7 million, 3.0% more than in the first half of 2018 – primarily due to strong sales of Perskindol® in Asia and Anti-Brumm® in Europe.

781.4

Net sales in million CHF

60.3

EBIT adjusted in million CHF

5,130

Number of employees

Contact

Galenica Ltd.

Untermattweg 8
3027 Bern

Tel. +41 58 852 81 11
Fax +41 58 852 81 12