Profits soar at Munro's wholesaling operation

Group Business Correspondent

Thursday 13 September 2012

SEPTUAGENARIAN Donald Munro has achieved 170% growth in profits at the pharmaceutical wholesaling operation he has built up since selling two other businesses in the sector in multi-million-pound deals.

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Mark williamson

The 76-year old entrepreneur's Strathclyde Pharmaceuticals made £2.8 million pre-tax profit in the year to March, underlining Mr Munro's standing as one of the country's most successful businessmen. Mr Munro's family was reported to have netted £30m-plus four years ago when he sold the eponymous chemists chain to Lloyds Pharamacy and the wholesale business the group developed to Germany's Phoenix Healthcare. He was aged 71 when the deals were completed.

Mr Munro decided to focus on wholesaling a relatively limited range of frequently prescribed items, a decision which appears to have paid big dividends.The Strathclyde Pharmaceuticals business Mr Munro developed with colleagues from the old group is now set for big expansion after quickly becoming a substantial business.In the latest accounts for the company, directors say they have approved investment in additional facilities which will double the area occupied by the East Kilbride-based company.This is expected to result in the company increasing employee numbers by around 40 to 150 in the current financial year.The expansion will allow the company to continue with a strategy that has involved increasing the range of pharmaceuticals it supplies.Strathclyde Pharmaceuticals sources more than 100 products from a range of European countries. It delivers hundreds of thousands of packets to pharmacies across the UK a year from a licensed warehouse facility and also supplies some wholesalers.Turnover rose by 61% in the year to March, to £65.6m from £40.8m in the preceding year.The growth has been driven partly by winning licences from regulators to distribute more products."New licences are continually being granted, which in turn allows us to service a greater part of the UK market," wrote directors in the accounts.Strathclyde Pharmaceuticals has benefited from the fact it operates in an area in which it is partly sheltered from the effects of the challenging economic conditions in the UK and Europe, although cuts in pubic spending have put health budgets under pressure.Directors have identified areas in which they see opportunities to expand."The directors have identified and implemented areas within the market that will allow continued growth for the year ahead," they wrote.A related company is a wholesaler of pharmaceuticals in European markets.Managing director John Cochrane said Strathclyde Pharmaceuticals increased turnover and pre-tax profit in the first quarter of the current financial year, compared with the same period the year before. Members of the management team have years of experience in what are very specialised markets.Mr Cochrane said: "All the directors see that part of the success is down to the commitment of our staff."The average number of staff at Strathclyde Pharmaceuticals rose to 116 in the year to March, from 90 the preceding year.Mr Munro opened his first pharmacy in Glasgow in 1959 and grew Munro Pharmacy to include 25 outlets in Scotland and Northern Ireland. The group bought 13 outlets from Alliance Boots in 2007. After moving into pharmaceuticals wholesaling in 1975, the group expanded to become a £175m business.Mr Munro's brother Bill developed Barrhead Travel into Scotland's biggest independent travel agent.

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Profits soar at Munro's wholesaling operation

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