Improved profitability

Oriola’s net sales in Q3 grew to EUR 424 million, driven by the Distribution segment. Adjusted EBIT increased from the previous year to EUR 5.5 (4.4) million. This improvement was supported by net sales growth and lower freight costs compared with the previous year. When excluding the impact of the Swedish dose dispensing business, the adjusted EBIT improved to EUR 5.4 (5.2) million. Oriola’s financial position remained strong.

In the Distribution segment, net sales grew by 23% to EUR 351 million, largely due to a customer shifting from consignment to our inventory. Organic growth was 5%, driven by higher market volumes and price increases. Profitability improved to EUR 5.0 (3.5) million, supported by net sales growth and lower costs compared with last year. Our market share was stable in Finland, while we saw a decline in market share in Sweden. During the quarter we signed new and renewed existing distribution agreements. One of the new agreements is with a cross-market customer, with volumes starting in Q1 2025. Additionally, we entered the optical sales channel in Sweden, where we see opportunities also for the wholesale business. 

In the Wholesale segment, net sales remained at EUR 74 million, the same as last year. While the Finnish wholesale business was stable, volumes in the Swedish wholesale business declined. Profitability was at last year’s level. As part of our strategy to grow the wholesale business, we added new products and suppliers to our portfolio. We gained new listings and introduced new products in the Finnish market, and introduced our own brand, Dexal, in Sweden. 

Since launching our refined strategy a year ago, we have made steady progress towards becoming the leading specialist in wholesale of pharmaceuticals and health products. This reflects the full commitment and dedication of our management team to our strategy and long-term targets. Our strategic investment to renew our ERP (enterprise resource planning) and WMS (warehouse management systems) is proceeding according to plan. Through this project we have reviewed and harmonised processes to ensure consistency and common ways of working across the company. 

For the second consecutive year, we retained our gold sustainability rating in the 2024 EcoVadis assessment. This important achievement recognises our ongoing commitment to integrating sustainability into our daily operations and continuously improving performance. In September, we committed to set near- and long-term company-wide emission reductions in line with science-based net-zero with the SBTi (Science Based Target initiative). We expect the targets to be validated in 2025.  

In the joint venture company, Kronans Apotek, e-commerce sales grew with double digits in Q3, improving the e-commerce footprint. The weaker customer flow in the brick-and-mortar operation resulted in flat sales compared with a year ago. Kronans Apotek is an important strategic partner for us, and we will actively support its value creation as a major shareholder. 

I am pleased with our solid performance in the third quarter. These results reflect the dedication of our people and the ongoing support of our valued customers and partners. As we move towards the end of this year, I want to thank everyone at Oriola for their work and commitment.

Katarina Gabrielson is the CEO of Oriola Corporation. This text was published in the Interim Report January-September 2024 on 30 October 2024. The complete report can be downloaded from the link below.