Costs Of Acquisition Hit Sigma

One of Australia's top three pharmaceutical wholesaling groups, SigmaPharmaceuticals, has reported 1996 net profits of only A$4 million ($3.1 million), and revenues for the year of A$1.2 billion, due to intense competition in the national market.

George Savvides, managing director of the company, said that costs associated with the restructuring of the business after it acquired QDL, a wholesaler in Queensland, in 1995, hit the bottom line hard. The acquisition was in line with Sigma's strategy to transform itself into a national health care company from a pharmaceutical wholesaler. It was also another leg in the race for more national market share between Sigma, F H Faulding and Australian Pharmaceutical Industries, which is soon to be listed.