Medicine sweet for drug company Sigma

Sarah Schwager
DRUG manufacturer and wholesaler Sigma will continue the $57 million expansion of its Dandenong site after reporting a near 20 per cent rise in net profit.
Sigma, which manages the Amcal and Guardian groups of chemists, last week posted a net profit of $31.65 million for the six months to July 2005.
This puts the company on target for a 15 per cent profit growth for 20052006.
The Sigma board approved the expansion of the Dandenong site in late May providing the company met its profit growth target.
Sigma managing director Elmo de Alwis said the 15 per cent business forecast incorporated the financial impact of the Croydon plant closure and expansion program.
The company now expects to complete the expansion of its pharmaceutical manufacturing facility in Dandenong in the next two years, after closing its Croydon plant at a cost of $2.9 million.
“This expansion will provide Sigma with significantly increased capacity, improved operational efficiencies and a more effective base to continue to meet compliance obligations,” Mr de Alwis said.
“It is an important phase that will deliver to Sigma greater scope for continued growth.”
Sigma’s pharmaceutical division, which manufactures prescription and nonprescription drugs, lifted its sales by 4.6 per cent to $167 million in the first half of this year.
Earnings rose 24 per cent to $37.8 million.
Mr de Alwis said the company’s main focus now would be a $2.2 billion proposed merger with Arrow Pharmaceuticals, scheduled to be completed by midDecember.