2016 was a tough start for City Pharmacy Limited (CPL) Group, as the Group suffered at the hands of weakening level of economic activity and soft commodity prices.
This was released in CPL Group’s half yearly report for the period ending June 30, 2016.
The effects of reduced domestic consumption were felt on profits and the parent company revenues were down 9%.
CPL Group is feeling the brunt of challenging economic times and it has shown in the first half year report.
Net Loss before tax for the group was K16,000 compared to a profit of K3.04m in 2015.
This was caused by firstly, a reversal of K1.5m insurance claim for Business Interruption. Secondly, a reduced profit of approximately K1.3m from tenders and wholesale Business predominantly from the government sector.
Thirdly, a K500,000 one-off expense for additional security and logistics expenses for the new Stop N Shop stores at Koki and Harbor City.
The Group also lost revenues of almost K2m in June as stores closed during the student unrest around the country.
They also face delayed government payments for supplies of essential pharmaceuticals. Combined with slow insurance payouts is putting strain on the cash flows for the day to day operations.
CPL expects the overall revenue to be stronger in the second half year with the inclusion of two new supermarkets at Koki and Harbor City.
CPL Group assured shareholders of its commitment for the long term and said it will continue to invest in its business improvement processes.