Sigma Healthcare systems has announced a large scale restructure of its business after seeing profits halve year over year, largely due to costs relating to the loss of its contract to supply The Chemist Warehouse Group.

The company’s net profit after tax fell 50.6 per cent to $13.8 million, while revenue dropped 2 per cent to $1.96 billion.

Despite the troubling numbers, Sigma chief executive and managing director Mark Hooper said the company was still on track to meet its FY19 guidelines without The Chemist Warehouse Group contract.

“We stand by our decision to not renew the MC/CW contract on the terms sought as it was not in the best long-term interests of the company or its shareholders,” Hooper said.

“This decision will free up over $300 million in working capital and provides us with an important pivot point to re-shape and grow the Sigma business.”

The group announced the appointment of global consulting company Accenture to provide support on the major restructure and cost reduction program.

“This is a far-reaching and structured review not just of operating and fixed costs, but expansion opportunities and overall business re-engineering,” Hooper said.

“Accenture will bring significant rigour to this process.”

Hooper went on to say the program will be detailed, measured and necessary program over the next 12 to 18 months, and will ensure maximised cost efficiency and growth opportunities in future.

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