The EBOS Group Ltd (ASX: EBO) share price has opened 2.29% lower this morning after a lacklustre full-year earnings result from the Aussie pharmaceuticals group.
EBOS posted earnings and profit figures that were broadly flat on FY18 figures this morning, despite some strong segmental results.
What were EBOS' full-year highlights?
Underlying the group's $137.7 statutory net profit after tax (NPAT) were some strong individual segment performances for EBOS.
EBOS' Institutional Healthcare segment revenue edged 2.4% on the prior corresponding period (pcp) to $2.29 billion for the year, with underlying growth of 7.3% largely from new speciality medicines boosting the result.
Management said revenue growth was dampened by reduced hepatitis C sales and Pharmaceutical Benefits Scheme (PBS) reforms, despite a strong showing from its recently acquired Warner & Webster brand.
Contract Logistics revenue climbed 14% higher on pcp to $518 million largely due to succesful expansion into New Zealand and the company's new 25,000 square metre facility in Sydney.
Consumer Products saw revenue climb 4.9% to $113.9 million during the year with strong domestic and international growth, the acquisition of Quitnits and increased marketing spend all contributing to the solid result.
EBOS' Animal Care segment saw revenue growth broadly flat on FY18 figures, with a key manufacturer in the sector choosing to supply directly to veterinary clinics impacting on its full-year figures.
However, the segment's earnings before interest, tax, depreciation and amortisation (EBITDA) margins improved for yet another year in a sign of strong expense management from the group.
Healthcare remains the biggest EBITDA driver for the group with over 80% of total EBITDA, while the company's Corporate segments were in the red for FY19.
What's happening with the Chemist Warehouse deal?
The Aussie healthcare group provided a trading update on its Chemist Warehouse Group deal which commenced on 1 July 2019.
Positively for shareholders, EBOS reported a material increase in activity across all of its Australian warehouses since it became the exclusive supplier of pharmaceutical products to all 450+ Chemist Warehouse stores.
Foolish takeaway
While investors may be wary of the slowing growth trajectory for the group, I still think the segmental performance looks relatively solid for EBOS.
Most importantly, the successful integration of the Chemist Warehouse supplier deal alongside its ongoing operations could prove to be the key to unlocking further share price growth in the next 12 months.
