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Well Pharmacy’s latest accounts show it made a £13m loss and exited a net total of almost 50 “non-core” branches in the 12 months to July 2024 in what it described as a “challenging year for the business,” adding that branch sales remain ongoing. 

The accounts, filed this week under its trading name of Bestway National Chemists, reveal that although revenue rose by 1.6 per cent to £728m and prescription volume by five per cent to 74 million in the year to June 30, it still made a pre-tax loss of £13.8m.

However, this was a marked improvement on the previous financial year when it lost £36.7m, with the UK’s second largest pharmacy chain managing to cut its losses by 62 per cent year-on-year. 

Similarly, at £10.6m the company’s operating losses (before interest income or expenses are accounted for) were 59 per cent lower than the previous year.

Staff costs rose from £138m to £143m, all of which was recharged to parent company Bestway.

As of June 30 last year Well Pharmacy was operating 733 branches, down from 782 at the same point in 2023. 

This included seven branches divested in order to gain the Competition and Markets Authority’s approval of Bestway’s acquisition of wholesaler Lexon UK and its network of 42 pharmacies after the watchdog raised concerns.

Other branches were also targeted for closure, with the report stating: “Identifying certain pharmacies that were non-core to the operational criteria of the business, the company initiated a programme of disposals to new and existing operators through a competitive tender process.

“This programme remains ongoing as the company seeks to ensure that its retail operation best meets the needs of its customers and patients and remains competitive within the wider community pharmacy market.” 

In addition to exiting branches over 2023-24, the company also acquired eight stores in Scotland and three in England, including London’s John Bell and Croyden Limited. 

“The acquisitions provide strategic balance and access to supply chain efficiencies not previously available,” said Well Pharmacy directors. 

The financial report states: “The business continues to grow its pharmacy services and has again gained market share in its wholesale business.

“However, despite the revenue growth it was a challenging year for the business.” 

Chief among these challenges are the effects of “a period of five years’ flat funding” and prolonged uncertainty over the negotiated pharmacy contract in England, which company directors contrasted with the increases announced by devolved governments in Scotland and Wales. 

Inflationary pressures and HMRC’s investigation into the employment status of locum pharmacists are also cited as actual or potential risks.