Eyecare Partners Limited has reported an increase in sales revenue, up from AUD$27.3m in 2008-09 to AUD$30.13m in 2009-10.
According to CEO Michael Kotow, on a like for like basis, sales for the 41 optometry practices owned and operated by the company were up 0.6 per cent, which he described as “pleasing, considering the climate of subdued retail activity and increasing competition”.
In its preliminary final report to the Australian Securities Exchange on 31 August, the company said gross profit increased by AUD$1.4m, which was 7.2 per cent above the prior year, and gross margins were 68.3 per cent. Operating loss before tax was AUD$4.13m compared to AUD$1.38m profit the previous year.
Mr. Kotow said the main contributors to the operating loss were a AUD$4.94 million goodwill write-off and personnel charges increasing 13.4 per cent to AUD$1.6 million mainly due to the contribution of the practices acquired. The goodwill write-off followed evaluation of the recoverable amount of value-in-use of cash generating units (optometry practices).
…the company said gross profit increased by AUD$1.4m, which was 7.2 per cent above the prior year, and gross margins were 68.3 per cent
He said it was a consequence of a combination of a decline in sales, increased overhead costs and decreased gross profit margins in specific practices, with the current and forecast results not supporting the carrying value of the full amount of goodwill paid upon acquisition of the practices.
“It is disappointing to have incurred the operating loss in light of the sales growth, but if one backs out a number of one off events such as the impairment charge of AUD$4.94 million and the termination payment to the previous Managing Director, the operating profit is AUD$1.26 million, which is very similar to the prior year of AUD$1.38 million,” said Mr. Kotow.
“I am very positive moving forward this year as we focus on strengthening our current businesses with additional resources being allocated to business development, investing in a new IT platform and a focus on driving costs down as a percentage of sales.”
Eyecare Partners has also recently appointed Lily Wegrzynowski as their National Human Resources Manager. Ms Wegrzynowski is a registered optometrist who has served on both the Optometrists Association Australia WA Board and the Optometrists Registration Board of WA.