Green Cross Health Limited Analysis

Overview

Overview

Green Cross Health is a provider of primary health care services to communities throughout New Zealand and supports a network of around 360 pharmacies, 41 medical centres, and provides community health care and nursing services to more than 30,500 people throughout New Zealand.

History

The business was first listed as Beauty Direct Online Ltd in March 2000. In February 2005 shareholders approved the acquisition of the business of Life Pharmacy and a 49% shareholding in 17 companies operating Life Pharmacies and in March 2005 the company changed its name to Life Pharmacy Ltd (NZX: LPL).

In May 2008 LPL acquired Care Chemist Ltd and in 2009, the company merged with Pharmacybrands, a group which included Unichem and Amcal pharmacies. In 2010 the company changed its name from Life Pharmacy Limited to Pharmacybrands Limited (NZX: PHB).

The 2011 acquisition of Radius Pharmacy, Radius Medical Limited and Radius Medical Solutions Limited marked a transition to becoming a provider of broader healthcare services. Investment in community care specialist Total Care Health Services in 2014 was followed by the change of company name from Pharmacybrands to Green Cross Health (NZX: GXH) to better reflect the full scope of primary health care services the company offers.

The acquisition of Access Homehealth, also in 2014, gave Green Cross Health significant presence in the community health care market, with more than 4,000 support workers and nurses.

The company continued to extend its presence in medical services, growing the number of practices and patients with the acquisitions of Tucker Consulting, a management services company serving six medical practices and Peak Primary, a group of 12 wholly owned general practice.

By mid-2015, the process of pharmacy rebranding started in 2013 was nearing completion, with the retirement of Amcal, Care Chemist and Radius Pharmacy brands in New Zealand and the growing pharmacy network consolidating under the Unichem and Life Pharmacy retail brands across 330 stores.

In 2015 Green Cross Health also acquired the remaining 50% shareholding in Total Care Health Services Limited, further enhancing the opportunity for growth in the community health market in Auckland.

Performance

The following information was extracted from Green Cross Health Limited's Full Year results, released 29 May 2025

Listed primary healthcare provider Green Cross Health, the Group behind Unichem, Life Pharmacy and The Doctors, reported Operating Revenue of $523.8m and Net Profit After Tax Attributable to Shareholders of $16.0m for the twelve months ended 31 March 2025.

Financial Overview

• Group Revenue $523.8m
• Operating Profit (EBIT) $38.7m
• Net Profit After Tax $16.0m
• Pharmacy Operating Profit $21.5m
• Medical Operating Profit $19.5m

Pharmacy Division

Revenue in Pharmacy for the reporting period was $370.4m, with Operating Profit $21.5m. One equity investment was completed in the year bringing the total number of stores in the network, including licensees, to 328 as at 31 March 2025.

Dispensary performance was strong with same store prescriptions up 4% compared to 31 March 2024. Unichem and Life pharmacies administered over 326,000 vaccinations, a 2% increase on the prior year. The Care & Advice Health Hub was launched to support the increasing demand for essential pharmacy services and raise consumer awareness of the clinical services available at pharmacies. The network is on track to achieve 200 Care & Advice Health Hub branded pharmacies by the end of the calendar year.

Same store retail sales were down 9% compared to the prior year reflecting the ongoing retail trading headwinds. A new store concept, Beauty by Life, was unveiled under the Life brand to modernise the beauty and wellness offering and reinforce the brand’s market position. The refreshed concept has introduced new product ranges, supplemented by beauty services to enrich customer experience and appeal to a broader market. The first Beauty by Life opened at the Life Newmarket store in November and will be extended to further sites in the coming year.

The upgraded Life Pharmacy ecommerce platform now offers customers a seamless experience from browsing stock availability online before visiting a store along with having the ability to shop online and collect the item in store, with 5,000 products purchased through click & collect since the capability was deployed late last year. The partnership with Uber Eats continues to build momentum and 149 pharmacies across the network are now able to service customer needs with on-demand delivery across the country.

Medical Division

Medical Revenue for the period was $153.4m, with Operating Profit $19.5m. Enrolled patients across the portfolio of 65 medical centres totalled 416,500, the largest enrolled patient base of any general practice group in New Zealand.

Following a period of strategic acquisitions, the Medical division shifted focus to consolidating its network to strengthen internal operations and maximise patient experience. Two medical practices underwent substantial refurbishments to add capacity for more patients to be seen in an upgraded clinical environment. Digital services are fundamental in administering patient care and over 120,000 active users are signed up on The Doctors App, booking an average of 20,000 appointments per month through this service, enabling enhanced patient engagement and service efficiency.

Group Commentary

This year the Company has navigated not only a difficult economic environment, but also a challenging primary healthcare landscape. Amidst inflationary pressures, insufficient government funding and constrained consumer spending, a focus on cost control and evolving the operating model has sustained results. Over the last five years, the Company has invested in excess of $85 million in technology improvements, site refurbishments and acquisitions to improve and expand the Company’s primary care offering.