Jhoots Pharmacy disposing of ‘existing branches’ amid £350k annual loss
Jhoots’ annual report has revealed that directors are “confident of [its] future prospects” and have paid their other businesses thousands of pounds in “management fees”, despite suffering losses for another year.
Jhoots Healthcare Limited suffered a pre-tax loss of £355,799 in 2023, its annual report released on Companies House this month revealed (September 12).
The West Midlands pharmacy reported that it had cut losses slightly against 2022, when it made a loss of £397,581.
It added that in the year ending December 31 2023, “the company generated turnover of £8.1 million”.
The figure reflects a 27% year-on-year decrease in sales from £11.1m in 2022 and a 38% decrease in sales since 2021, when company turnover was £13.2m.
“The company is currently working with a key educational partner to grow training and development through the business,” the report said.
“The directors are therefore confident of the company’s future prospects,” it added.
Branch disposal
The report revealed that “during the year and subsequent to the year end, the directors have continued with their strategy…to reduce the company's debt profile”.
It set out a plan to “identify and dispose of branches whose location and performance are not aligned with the company's overall business strategy”.
It said that “the sale of existing branches” was “ongoing at the date these financial statements were approved”.
Jhoots added that it was rationalising “loss-making branches to expand business and improve gross margins” and “realising efficiencies within the business".
But it said that the company also “continues to achieve growth by seeking and acquiring more pharmacies”.
“Management fees”
“The directors are also directors of a number of related companies that Jhoots Healthcare Limited has traded and dealt with,” the report revealed.
It said that in 2023, Jhoots was “charged management fees amounting to £700,000” – up from £500,000 in 2022 – “from these related parties for head office expenses”.
And a “management charge of £360,000” was also “levied to a related party and is receivable”, it added.
It said that by the end of the year, it still owed £404,167 to “participating interest entities”, down by £899,184 since 2022.
And it added that as of December 31 2023, Jhoots owed director MS Jhooty £60,932 – down from £109,893 the previous year.
Bailiff drama
Meanwhile in July, C+D exclusively revealed that a Jhoots branch was the fourth premise to be repossessed by bailiffs in connection with Lloydspharmacy’s liquidation.
At the time, a Devon landlord’s agency told C+D that “when Lloydspharmacy was liquidated” earlier this year Jhoots “somehow managed” to go into the premises with “no lease assignment” and did not pay “a penny” of rent.
Jhoots said that it “[disputed] the facts recalled by the landlord” and stressed “that many genuine attempts were made by [the chain] to reach an amenable deal with the landlord”.
“We wanted to continue our occupation and operation of the pharmacy to enable us to keep providing vital services to the town,” the pharmacy chain said.
In April, bailiffs repossessed another Jhoots branch previously operated by Lloyspharmacy in Rainham, Kent.
Jhoots Pharmacy announced that it had bought 36 former Lloydspharmacy branches using a £17.4 million loan from HSBC in November.
