Paragon Pharmacies Limited
TSX VENTURE : PGN

Paragon Pharmacies Limited

November 18, 2010 19:32 ET

Paragon Pharmacies Limited Reports Fiscal 2010 Financial Results

KELOWNA, BRITISH COLUMBIA--(Marketwire - Nov. 18, 2010) - Paragon Pharmacies Limited ("Paragon" or "the Company") (TSX VENTURE:PGN) today reported its financial results for the fiscal year ended August 31, 2010.

Revenue for the year was $82.918 million compared to $86.134 million in the same period last year. This 3.7% decrease was mainly the result of a decline in comparable store pharmacy and front store revenue. Front store revenue declined due to the divesture of the home healthcare business late in fiscal 2009 and continued competitive pressure. Pharmacy revenue growth was impacted by the increased availability of lower priced generic drugs in the market. 

"While fiscal 2010 saw a decline in overall revenue, the Company has undertaken a number of initiatives which will allow Paragon to focus on growth of revenues in existing stores, growth in our asset base through acquisitions and greenfield opportunities, and growth through continued investment in our long term care operations," said R. Gordon Gooding, Chief Executive Officer. He continued by stating, "Key to Paragon's growth is monitoring the effect of regulatory changes on the Company's business model, while focusing on the ongoing recruitment, retention and training of professional, customer-focused store and pharmacy managers and staff who will continue to ensure that our customers' health and wellness needs and expectations are not only being met, but exceeded."

Operating income, as defined, was $8.278 million compared to $8.404 million in the same period last year, a decrease of $0.126 million or 1.5%. 

EBITDA, as defined, was $3.559 million for fiscal 2010 compared to $3.907 million in the same period last year, a decrease of $0.348 million or 8.9%. The decrease in EBITDA was a result of the reduction in front store revenue and an increase in corporate expenses offset by a reduction in operating expenses over the same period in the prior year.

The net loss for the fiscal year ending August 31, 2010 was $2.594 million, compared to a net loss of $7.257 million in the same period last year. This decreased net loss of 64.3% ($4.663 million) is primarily due to a reduction in financing costs relating to the convertible debenture.

The pharmacy industry continues to face ongoing regulatory change which will alter the way generic drugs are priced. The Company's assessment of these changes is more fully described in Management's Discussion & Analysis for the fiscal year ended August 31, 2010 in the section entitled Regulatory Changes That Impact the Company's Industry

The Company's audited consolidated financial statements and Management's Discussion and Analysis for the fiscal year ended August 31, 2010 are available at the Investor Relations section of Paragon's website at www.helloparagon.com or under the Company's profile on SEDAR at www.sedar.com.

Paragon Pharmacies Limited is building a pharmacy with our customers in mind. Headquartered in Kelowna, BC and employing over 400 staff, Paragon currently owns and operates 19 retail pharmacies and three central fill pharmacies throughout British Columbia, Alberta and Manitoba. Paragon is a leading mid-market pharmacy, providing premier pharmacy services in a friendly, community-focused environment.

FORWARD LOOKING STATEMENTS

This press release contains forward-looking statements regarding, among other things, the Company's beliefs, plans, objectives, strategies, estimates, intentions and expectations, including as they relate to its operating and financial results, capital expenditures and the ability to execute on its operating, investing and financing strategies. Consequently, actual results and events may differ materially from those included in, contemplated or implied by such forward looking statements for a variety of reasons. Forward-looking statements are subject to inherent risks and uncertainties including, but not limited to, market and general economic conditions, certain property and casualty risks, the ability to attract and retain pharmacists, the availability and terms of financing, changes in the Company's relationship with its key suppliers, competitive factors, changes in regulatory environments affecting the Company's business, and the accuracy in management's assumptions (see "RISKS AND RISK MANAGEMENT" as noted in the Company's Management's Discussion & Analysis posted on SEDAR at www.sedar.com). This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. Investors and others should carefully consider these and other factors and not place undue reliance on these forward-looking statements. In addition, these forward-looking statements relate to the date on which they were made and the Company disclaims and has no intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Paragon Pharmacies Limited
    R. Gordon Gooding, CA
    Chief Executive Officer
    (250) 868-8400
    (250) 868-8402 (FAX)
    www.helloparagon.com