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Revenue Growth: Increased by 15% for the half-year. Chemists Warehouse Sales: Up 17% in the Australian network; like-for-like sales up 15%. International Sales Growth: Network sales up 24.5%; like-for-like sales up 11%. Normalized EBITDA: Increased by 18.7%. Normalized Net Profit After Tax (NPAT): Almost 20% increase. Supply Chain Volume Growth: 5% increase with flat distribution costs. Synergy Benefits: Achieved $13 million in the first half. Dividend: Declared $0.02 per share, payout ratio close to 60%. Store Expansion: Added 13 Chemists Warehouse branded stores; 9 new stores in New Zealand and 3 in Ireland. Free Cash Flow: $284.6 million, enabling debt reduction by $117 million. Capital Expenditure: $13.7 million for the half-year. Net Debt Leverage: Improved to 0.61 times EBITDA from 0.85 times. Gross Profit Margin: Consistent at 18.3%. Normalized EPS: Increased by 19.4% to $0.04 per share. Operating Cash Flow: $317 million for the first half. Net Debt: Reduced to $635 million from $752 million at year-end. International Store Network: 89 stores across New Zealand, Ireland, and Dubai. Own and Exclusive Label Products: Launched over 400 new products, representing close to 10% of CW store sales.

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Release Date: February 25, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Sigma Healthcare Ltd (SIGGF) reported a strong first half performance with a 15% revenue growth, driven by robust network demand and consistent execution across markets. The company achieved $13 million in synergy benefits from its integration program, which is on track to meet its $100 million target by FY29. International operations are scaling well, with 12 new stores opened in New Zealand, Ireland, and Dubai, contributing to a 24.5% increase in network sales. The company launched over 400 new own and exclusive label products, which now account for nearly 10% of Chemist Warehouse store sales, supporting margin growth. Sigma Healthcare Ltd (SIGGF) declared a dividend of $0.02 per share, representing a payout ratio of close to 60%, indicating strong shareholder returns.

Negative Points

The equity accounted profit line for New Zealand decreased year over year, despite strong sales growth, due to one-off items in the prior year. Admin and general expenses increased by about $30 million, or 17%, driven by international business growth and public company costs, which may impact future cost management. The company faces challenges in cross-selling additional products to GLP-1 medicine customers, indicating potential missed opportunities for revenue growth. There is uncertainty regarding the impact of GLP-1 medicines on future sales growth, as the category's long-term sustainability and margin effects remain unclear. The integration and synergy realization process is complex and long-term, with significant benefits expected only in the third and fourth years, posing execution risks.

Story Continues

Q & A Highlights

Q: Can you explain the decrease in the equity accounted profit line for New Zealand despite strong sales growth? A: Richard Murray, CFO: The decrease is due to the share of profits from associates and joint ventures, primarily from our New Zealand store performance. The other income line reflects some one-off commercial arrangements with suppliers from the prior year, which impacted the comparison.

Q: What drove the 17% increase in admin and general expenses? A: Richard Murray, CFO: The increase includes one-off costs related to growing the international business, investments in IT, and costs associated with being a public company. We aim to manage these expenses more effectively in the future.

Q: How significant was the impact of GLP-1 sales on first-half growth, and what is the outlook for this category? A: Vikesh Ramsunder, CEO: GLP-1 sales significantly boosted first-half growth. We believe this category is enduring and will continue to grow, driven by ongoing adoption and innovation. While margins are lower due to the high cost of the drug, it is expected to expand the market size over time.

Q: How does the company plan to leverage the GLP-1 category to drive additional sales? A: Vikesh Ramsunder, CEO: Currently, GLP-1 is primarily a pharmacy product, but there is an opportunity to cross-sell related products, such as protein supplements, to support patient needs. We see this as a future growth area.

Q: What is the strategy for expanding the brand portfolio, particularly for non-Chemist Warehouse brands? A: Vikesh Ramsunder, CEO: The merger allows us to offer a portfolio of brands catering to different market segments. Chemist Warehouse is positioned as a discount pharmacy, while Amcal and DDS serve community and convenience needs. This strategy enhances our market opportunities.

Q: How should we think about the fixed and variable nature of expenses over the next three years? A: Richard Murray, CFO: As a franchisor, we have a higher proportion of fixed costs, particularly in Australia. However, international operations, like New Zealand, have variable costs due to joint ventures. We remain focused on cost management to support growth.

Q: What is the outlook for international expansion, and are there plans to enter new markets? A: Vikesh Ramsunder, CEO: We are focused on our core markets of New Zealand, Ireland, and Dubai. Any decision to enter new markets will be communicated appropriately. We are confident in our current markets and will update the market on any strategic decisions.

Q: How is the retail media landscape evolving, and what impact does it have on earnings? A: Vikesh Ramsunder, CEO: Retail media is a crucial part of our value generation, aligning with our revenue growth. We focus on providing value to suppliers, which supports our retail media income and overall business performance.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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