Daily analyst comments

Pharmacy Chain 36.6 posts 1Q 2009 financials


	Pharmacy Chain 36,6

Capitalization: 24 906 530,00 $

Common shares
Price	2,62 $

Price changing
week	month	year
-1,0%	-0,6%	-57,5%

03.07.09 11:01

The 1Q 2009 report from Pharmacy Chain 36.6 shows improvements in the company’s retail operations, which resulted in a reduced loss and a positive EBITDA at the end of the reporting period. We do not rule out some speculation-driven growth in demand for Pharmacy Chain 36.6 shares; however, in line with our estimates, the company’s stock is currently valued close to its fair value.

Pharmacy Chain 36.6 (RTS: APTK) has released 1Q 2009 financials. In general, the report reflects the improvements in company’s retail operations in spite of the negative sales performance. The optimization of the retail outlet’s structure allowed the pharmacy chain to raise its gross margin by 5 pp.

Table. Pharmacy Chain 36.6: key financials FY 2008, USD million

	1Q2008	1Q2009	Change 1Q2009/1Q2008
Sales	278	172.8	-37.8%
Retail	230.1	141.2	-38.6%
Veropharm	34.7	26.9	-22.5%
Other	13.20	4.70	-64.4%
Gross income	84.8	61.3	-27.7%
Gross margin	30.5%	35.5%
Retail	58.1	42.7	-26.5%
Veropharm	21.8	17.4	-20.2%
Other	4.90	1.20	-75.5%
EBITDA	-0.8	6.2
EBITDA margin	negative	3.6%
Retail	-11.2	1.1	-109.8%
Veropharm	9.2	5.8	-37.0%
Other	1.20	-0.70	-158.3%
Net income	-24.2	-19.1	-21.1%
Retail	-31.4	-22.3	-29.0%
Veropharm	6.3	3.8	-39.7%
Other	0.90	-0.60	-166.7%

Source: company data, Finam estimates

We are quite upbeat on the 1Q 2009 report from Pharmacy Chain 36.6: the company managed to bring its EBITDA indicators in the retail segment out of the red and into the positive area. At the same time, debt is still a critical issue for the pharmacy chain: in 1Q 2009, the pharmacy chain’s debts were almost the same as in FY 2008.

The fair value of Pharmacy Chain 36.6 is USD 5.70 per share, which is equivalent to the company’s current market valuation.

Sergey Filchenkov

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