Sigma Pharmaceuticals Ltd (ASX: SIP) reported its full year 2016/2017 results wherein underlying EBIT witnessed a rise of 12.4% to $100.2m and underlying NPAT surged up 13.0% to $66.9 million. Reported EBIT was up 1.1% while reported NPAT rose 5.3% only owing to impact from one-off items relating to an insurance premium recovery claim ($11.4m) and a doubtful debt provision ($8.3m). There has been a rise in underlying return on invested capital (ROIC) to 16.8% from 14.6% of the prior year. As at January 2017, yearly revenue was up 26.2% and this included the impact of the listing of Hepatitis C medicines on the PBS.The group has been focussing on investment program to improve the distribution centre network and recently delved into a new $55 million investment for a new distribution centre in Canning Vale, Western Australia.
 

Financial Performance (Source: Company Reports)
SIP has confirmed the existing guidance for FY18 of at least 5% underlying EBIT growth. The group also indicated its intention to change the name to Sigma Healthcare Limited, subject to shareholder approval scheduled in May 2017. On the other hand, the group still expects to witness challenges while it is to bear the full cost of its reinvestment plans. For capital management, SIP’s board seems to be comfortable in refreshing it’s buy-back program up to a further 10% of shares on issue.The group has net debt of only $8.7 million at the end of the year. SIP stock rose 2.5% on March 23, 2017 post a drop of 13.67% in last six months (as at March 22, 2017).

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