Expects improvements throughout the second six months of FY18: Australian Pharmaceutical Industries Ltd (ASX: API) expects improvements throughout the second six months of FY18. However, API’s 2018 half-year profit is expected to be down 9% compared to the prior corresponding period, on account of soft retail conditions witnessed by its Priceline Pharmacy network. API expects its half year 2018 net profit after tax (NPAT) to be approximately $26.5 million. However, the company expects that its full year NPAT will be marginally above that of FY17. Moreover, overall network sales, including dispensary, for the financial year to date is up 2% but the like-for-like front-of-store sales in its network had fallen 2.4% for the period.
 
Additionally, the dividend payment for the first half is expected to be in line with the prior corresponding period. API has confirmed that its balance sheet and cash flow position is strong. Meanwhile, API stock has fallen 5.57% in three months as on January 30, 2018 but surged up 4.2% on January 31, 2018, and this may be owing to some rebuilding of positive sentiments on the stock. We give a “Hold” recommendation on the stock at the current price of $1.50
 

Core Business Distribution Trends (Source: Company Reports)

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