Well Pharmacy’s accounts for the 12 months to June 30 2022 provide a net profit figure of £4.1m, down 14.8 per cent on the previous year (£4.8m), which the company attributed in part to “increasing payroll costs” such as locum pharmacist rates.

The accounts, which were published by parent company Bestway last week under the name Bestway National Chemists, point to a 0.6 per cent reduction in revenue year-on-year, with a total figure of £692m for 2021-22.

Total pre-tax profits were £4.2m – down 77 per cent on the 2020-21 figure of £18m – with a deferred tax charge of £5.1m leaving the company with £106,000 to pay in taxes for the financial year. Meanwhile, operating profits fell from £24.6m in 2021 to £8.2m in June 2022.

Despite Well Pharmacy being “in a net current liabilities position,” including £194m owed to fellow Bestway subsidiary companies, the report provides a net assets figure of £33.6m as of June 30 (2021: £59.5m). 

The Companies House annual report states that prescription items increased by 0.7 per cent to just over 72 million in 2021-22, and that as of June last year the company owned 740 pharmacies, nine fewer than at the same point in 2021.   

Chief financial officer Katie Jacob said in the annual report: “Our strategic intent is to improve the quality and scale of the network where reasonable value exists. In FY22 we sold a number of our smaller pharmacies and acquired some new ones to achieve this objective.”

Commenting on the company’s performance, Ms Jacob said: “The year delivered lower revenue compared to the prior year with OTC and pharmacy services being impacted by Covid, partially offset by delivering Covid vaccinations and distribution of Covid tests; this was further impacted by increasing payroll costs, especially those associated with locum pharmacists.”

The report point to a 0.6 per cent year-on-year increase in total spending on wages, from £132.8m to £133.7m. Meanwhile, directors’ emoluments increased from £992,000 to £1.1m, with the highest paid director’s payment going from £472k to £673k.

Ms Jacob said the flat funding contractual arrangements in England still “present a key risk to community pharmacies, especially when combined with wider inflationary pressures and the healthcare workforce challenges”. 

She added: “The business continues to focus on maximising its capacity to deliver against the breadth of services available under the contract while maintaining careful control of its cost base.

“The future objective of the company is to improve gross margins and maximise profitability by realising efficiencies within the business. There has remained a focus on leveraging technology assets to help drive both market share and efficiency gains via our central fulfilment, digital and omnichannel projects.”

“Despite the ongoing funding challenges facing pharmacies, we continue to invest in our sector showing our commitment to pharmacy and offering accessible healthcare services to local communities. During the year we demonstrated our commitment through the acquisition of Bridge Pharmacy Limited further strengthening our pharmacy provision in west Wales.”