Class action settlement knocks $48m off Sigma result
The settlement of a class action by Sigma Pharmaceutical shareholders has taken $48 million out of the company's full-year profits.
The leading healthcare company, which manufactures and distributes prescription and over-the-counter drugs to pharmacies around the country, reported a net profit of $18.7 million - 64 per cent less than it would have without the December settlement.
The class action by retailers involved disclosures during the financial crisis, and forced Sigma to pay out $57.5 million in settlement fees.
Sigma said that the company's result was affected by one-off costs, such as the settlement, as well as refrigeration issues at its Newcastle site. It also said reforms to the PBS scheme had hit its bottom line, and would continue to be a challenge this year.
"Sigma has delivered continued improvement on its key financial metrics against the backdrop of the toughest era of PBS reform in more than a generation," Sigma chief executive Mark Hooper said.
The federal government last year moved to cut the amount it pays for 180 drugs listed under the PBS by at least 23 per cent - about a third of the value of the PBS.
Sigma, which owns the 75-year-old Amcal chemist brand, also delivers many of the generic drugs listed on the PBS.
Sigma shares closed 2¢ higher at 65.5¢.