Chemist Warehouse and the power of ultra long-term thinking
The retail giant's patient, long-term approach and 100-year vision will be tested when it lands on the ASX via an $8.8 billion reverse merger with Sigma Pharmaceuticals.
It is rare to hear the chief executive of an Australian company speak about his or her company in 100-year terms. In a financial culture fixated on short-term profits and dividends, influenced by a business media that's focused on daily deadlines, short termism usually prevails.
So it was refreshing to hear Chemist Warehouse CEO Mario Verrocchi use the century-long timeframe to describe the trajectory of his business on a call with investors to discuss the retail giant’s $8.8 billion reverse merger with Sigma Healthcare.
“We have this 100-year theory,” he said at one point on the call. “Our pharmacy story has another 50, 60 years to run.”
Verrocchi delivered a 10-minute rundown of the group’s 50 year history until now: what began as a single pharmacy in suburban Melbourne in 1972, and was three stores by the time Verrocchi joined in 1980, is now a retail behemoth generating $3.1 billion a year in sales and $460 million in earnings before interest and taxes.
