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Shop Apotheke Soars on Solid 1H Sales Growth; E-Prescriptions Expected from Sept.

Published 05/07/2022, 10:50 pm
Updated 05/07/2022, 10:50 pm
© Reuters.

By Geoffrey Smith -- Shop Apotheke (ETR:SAEG) stock rose 10% on Tuesday after the German online pharmacy chain reported better-than-expected sales in the second quarter, allowing it to uphold its guidance for the full year.

Shop Apo said sales growth accelerated in the second quarter to 287 million euros ($296 million), up 15% from a year earlier. First half sales reached 592 million euros, up 11% on the year and the company confirmed that it still expects sales growth of between 15% and 25% for the whole of 2022.

The company is on the verge of an important step in its long-term development, now that Germany's authorities have approved the issuance of drugs through digital prescriptions. Pharmacies in the federal state of Schleswig-Holstein and part of North Rhine-Westphalia will begin to issue e-prescriptions in September, with a further six regions starting in December.

As an e-commerce operation, Shop Apo was one of the big early winners of the pandemic, but it has given up most of its gains in recent months amid concerns about the slow rollout of electronic prescriptions. That has left it dependent on sales of non-restricted goods such as beauty products and health supplements for now.

By 8:30 AM ET (1230 GMT), Shop Apo stock was up 9.6% in Frankfurt.

As such, the company is still to make a profit. Even at a basic operating level, it barely breaks even: it's guiding for an EBITDA margin between plus and minus 1.5% for 2022. However, it continues to add customers in line with expectations: it added another 700,000 in the first half of the year to a total of 8.6 million as of June. The company expects a fresh boost from the start of operations at its distribution center in Milan, Italy, "in the late summer."

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