Pharmacy chain franchisor Jean Coutu posts lower Q2 profit of $51.2; revenue up

By The Canadian Press

LONGUEUIL, Que. - The Jean Coutu Group (TSX:PJC-A.TO - News) has reported an increase in revenue but a drop in net profit in its latest quarter compared with a year ago when the pharmacy chain franchisor recorded an unusual gain on the sale of U.S. assets.

Quebec-based Jean Coutu said Wednesday that its net profit in the three months ended Sept. 1 was $51.2 million or 23 cents per share. That compared with 66.4 million or 20 cents per share in the comparable year-earlier period.

Revenue for its fiscal 2013 second quarter rose to $658.7 million from $635.2 million in the same fiscal 2012 period.

"The decrease in net profit is mainly attributable to a gain related to the sale of Rite Aid's shares, for a total proceed of $22 million, net of related costs, during the quarter ended August 27, 2011," the company said in a release.

Excluding gains related to the sale of Rite Aid shares and the change in fair value of other financial assets, net profits amounted to $50 million or 23 cent per share for the quarter, compared with $44.6 million or 19 cents per share in the year-earlier period.

"The $5.4-million increase . . . is mainly attributable to the solid operational performance of (subsidiary) Pro Doc and of franchising activities," it said.

On a same-store basis, the PJC network's retail sales grew by 2.6 per cent, pharmacy sales gained three per cent and front-end sales increased by 1.6 per cent compared with the same period last year.

Sales of non-prescription drugs, which represented 8.4 per cent of total retail sales, increased by 3.9 per cent, up from 2.9 per cent for the same period of fiscal year 2012.

Jean Coutu Group operates a network of 402 franchised stores in Quebec, New Brunswick and Ontario under the banners of PJC Jean Coutu, PJC Clinique, PJC Sante and PJC Sante Beaute, and employs close to 19,000 people. It also owns Pro Doc Ltd., a Quebec-based subsidiary and manufacturer of generic drugs and has an investment in Rite Aid Corp., a company with more than 4,600 drugstores in the United States.

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Pharmacy chain franchisor Jean Coutu posts lower Q2 profit of $51.2; revenue up