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Sigma Healthcare (ASX: SIG), its business transformed through the merger with Chemist Warehouse, is tracking at double-digit growth for its retail network in the new financial year after underlying profit surged and revenue topped $6 billion in FY25.
Retail goliath Chemist Warehouse was the standout performer for the group which delivered like-for like sales growth of 11.3 per cent.
Sigma, which also operates the Amcal and Discount Drug Stores chains, has revealed that this trend has continued into FY26 with like-for-like sales currently tracking at a double-digit growth rate.
The merger between Sigma Healthcare and Chemist Warehouse was completed in February this year, boosting normalised group revenue to $6 billion – up 82 per cent compared with FY24. But had the business been owned for the full year, group revenue would have hit $9.6 billion.
Sigma posted normalised earnings before interest and tax of $834.5 million in FY25, up 41 per cent, with normalised net profit after tax rising 40 per cent to $579.1 million.
“The merger with Chemist Warehouse has delivered a stronger, more integrated healthcare business, with greater scale, capability and market reach,” says Sigma Healthcare CEO Vikesh Ramsunder.
“The FY25 results demonstrate the group’s momentum and potential for ongoing growth.”
Ramsunder says the group has made “good progress” integrating the Chemist Warehouse business and Sigma has upgraded the targeted synergies from the merger over the next four years from $60 million to $100 million a year.
Across its group retail portfolio, Sigma opened 35 new stores in Australia and internationally, taking its franchise store network domestically to 881 outlets.
The Chemist Warehouse group currently comprises 588 outlets and in FY25 it achieved total retail network sales of $10.3 billion, up 14 per cent compared with a year earlier.
“Our international network continues to grow across New Zealand, Ireland and UAE demonstrating that the Chemist Warehouse model is transportable and scalable in other markets,” says Ramsunder.
“Meanwhile, with a focus on delivering profitable growth, we have taken the decision to progressively close the Chemist Warehouse bricks and mortar stores in China over the next few years, with the China market to be serviced through the online channel.”
Sigma plans to roll out new Chemist Warehouse stores at the same pace of previous years both in Australia and offshore.
“We also expect to continue to launch new own and exclusive label products to drive margin improvement,” says Ramsunder.
“Integration activities are well under way with the bulk of the synergy benefits anticipated in FY27 and beyond.”
Sigma Healthcare is paying a final dividend of 1.3c per share, fully franked.
Shares in the company were trading 10 per cent higher at $3.10 at 10.31am (AEST).
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