City Pharmacy Limited Group of companies have announced a net profit after tax for the parent company of K7.35m (2014: K7.55m), while the group net profit after tax was K6.56m (2014: K6.91m).
Chairman Mahesh Patel when commenting on the announcement said 2015 has been another tough year for the company.
“Our revenue growth started well in the first half, but was stifled in the second half due to the fire at Waigani Central, our largest volume outlet.
“Our new growth plans which incurred increased expenses were severely impacted due to the reduced volume from Waigani, a serious market slow-down and reduced consumer spending in the second half.”
He said the group turnover has increased due to consolidation of the Hardware Haus revenues for the second half with sales increased by only 5%, while our cost of doing business increased by 94%, resulting in a negative impact on profitability.
Patel said the company is confident that their turnaround in 2016 will be more, as their two new Stop n Shop outlets at Koki and Harbour City are scheduled to be opened.
“This will also add another 500 team members to our work force.
“Our drive for efficiencies and cost reduction will continue and bear fruits at year-end,” he said. Patel added that the company’s Airport Duty Free has started a Fast Track service which is a ‘pay at departures and pick up on arrivals’ concept and has been taken up well by travellers.
“Our expansions ¡n Lae will also see the opening of a second City Pharmacy outlet in Lae City, together with our third Jacks of PNG outlet.
“We will also open a new Prouds (duty paid) outlet in Lae City.”
He said there are ongoing capital expenditures earmarked for store improvements and refurbishments as they, as a company, will continue to invest back into the company and our people.
“I would like to thank all our team members across the nation for their continued hard work and dedicated efforts for the company.”
Meanwhile, a dividend of 3 toea per share has been proposed and if this is approved at the Annual General Meeting on May 11, will be paid in June 1.
Patel said this maintains the practice of distributing approximately 50% of after tax profits to the shareholders.