GXH - Green Cross Health (formerly PHB - Pharmacybrands)

[Food4Thought]

Half year result looked good to me. Should be good for $1.40 for now? Currently $1.27, but feels like some distribution here still. Needs institutional interest.

I think this was great https://www.nzx.com/files/attachments/185867.pdf

Certainly worth the current price and I speculate it to become one of the shares that many people who also invest into aged care consider. And perhaps those people in aged care invest in, as it is trending into a good income share. Slow and steady. The Briscoes effect.

Solid outlook. Medical centers and pharmacies are more and more depended on by the consumer. I also guess they would be a worthy business for a buy out, as their presence in the market is growing in an industry that takes major profits. Watching them stores grow with interest "margins are tight etc etc say's the pharmacist" as he climbs into his late model Audi...

[GarryB]

Have margins not improved (still tight) for pharmacies in the last few years as direct prescription prices have increased from $3 to $5, and prescription trend is upwards, steep. Going to the Doc for a prescription, subsidized by the government, is much more cost effective then buying direct from a pharmacy...

*****

This misses the way the funding model is structured. The " was $3.00 , is now $5.00 " fee is a co-payment set by the Ministry of Health ie not in pharmacy's control. That co-payment is in effective a user tax - from the pharmacist's perspective the total payment per script hasn't grown - it's just the proportion that has changed ( more coming from the end user rather than being funded by the Govt.

[Food4Thought]

Have margins not improved (still tight) for pharmacies in the last few years as direct prescription prices have increased from $3 to $5, and prescription trend is upwards, steep. Going to the Doc for a prescription, subsidized by the government, is much more cost effective then buying direct from a pharmacy...

*****

This misses the way the funding model is structured. The " was $3.00 , is now $5.00 " fee is a co-payment set by the Ministry of Health ie not in pharmacy's control. That co-payment is in effective a user tax - from the pharmacist's perspective the total payment per script hasn't grown - it's just the proportion that has changed ( more coming from the end user rather than being funded by the Govt.

Hi GarryB. Thank you for updating me on this small, but important piece of information. I certainly got that wrong. What is your perspective on PHB as a long term investment?

Cheers

[Food4Thought]

Pharmacybrands Limited is New Zealand’s only listed retail pharmacy group and comprises the Unichem,
Amcal, Life Pharmacy, Radius Pharmacy and Care Chemist brands. In total the Company represents 301
retail outlets operating throughout New Zealand. Of the 301 retail outlets, the Company has an ownership
interest in 74 pharmacies. The Company also has an ownership interest in 11 Radius Medical Centre
companies.

That is a lot of businesses under one Umbrella Brand.

[Food4Thought]

Does anyone think that PHB has a few too many brands under their control? Would they not be better to sell down their less favorable operations and focus on the core business?

[zigzag]

Does anyone think that PHB has a few too many brands under their control? Would they not be better to sell down their less favorable operations and focus on the core business?

They in the process of consolidating their brands at the moment. I'm not sure which ones they're keeping, and which ones will be rebranded, but the info. is most likely in their latest report. I think this stock is a quiet little achiever, and flies under most peoples radar.

[benjitara]

yes they're restructuring their brands under "life' and one other and also doing store refits. To me the stock is a interesting study... Their retail has remained flat for the last couple of reports and their margins are under pressure. The pharmacy is also regulated outside factors. The main positive to come out of recent reports is their buy in to medical centers which would be most progressive thing they could do in my opinion. I still have the stock overvalued by some 10%

[noodles]

yes they're restructuring their brands under "life' and one other and also doing store refits. To me the stock is a interesting study... Their retail has remained flat for the last couple of reports and their margins are under pressure. The pharmacy is also regulated outside factors. The main positive to come out of recent reports is their buy in to medical centers which would be most progressive thing they could do in my opinion. I still have the stock overvalued by some 10%

Gross Margins and NPAT improved in the last Half Year result.

[Food4Thought]

Thanks. I have a feeling this is still an under valued stock. Long term, I see it trending upwards with an ageing population. Certainly recommend this share if RYM, SUM, are in your portfolio. They go hand in hand in my eyes.

[noodles]

Same store sales need to start increasing for me to buy in again.

Like all retailers, the internet is an issue.