Fontana Limited generated record revenue but lower profit across its enlarged 11-store pharmacy network.
It plans to cut costs going forward.
“The next phase will focus on inventory optimisation, purchasing efficiencies and improving productivity across the acquired locations,” Chairman Kevin O’Brien Chang and CEO Anne Chang said in the directors’ report to shareholders. “The consistent application of the ‘Fontana Way’, that is our core operating disciplines and ways of working, will also be critical to the success of the expanded network.”
Revenue for the year ended June 30, 2026 reached a record $10.7 billion, up 12.4 per cent from $9.52 billion. Gross profit rose 11.1 per cent to $4.02 billion. But net profit fell to $507.8 million from $583 million, and earnings per share dropped to $0.41 from $0.47.
Costs outpaced the top line.
Cost of sales climbed 13 per cent to $6.68 billion against revenue growth of 12.4 per cent, trimming the gross margin to 37.6 per cent from 38 per cent a year earlier.
Anne Chang said the addition of Monarch pharmacy chain to the network aided growth, particularly in Kingston. Its western branches absorbed the damage from Hurricane Melissa, which struck last October.
“The majority of our incremental revenue was driven by our Kingston-based stores, with the Monarch stores driving much of the growth. There was general softness in our western branches due to the hurricane; however, they are still showing positive growth,” Chang said in a written response to queries from the Financial Gleaner.
The directors’ report said the hurricane hit second-quarter trading in western Jamaica, and that revenue growth recovered to 17.7 per cent by the third quarter.
Fontana acquired the four Monarch pharmacies from Gerk Limited in March 2025, in the previous financial year, taking its network from seven stores to 11. The chain paid $854.5 million – $504.5 million in cash, funded largely by an unsecured $633.75-million five-year bond, and $350 million in promissory notes to Gerk, a company affiliated to the Loshusan family. Of the purchase price, $182.4 million covered identifiable physical assets and $672 million went to goodwill and intangibles.
The report also pointed to the “exciting development and positioning” of the three Ora by Fontana beauty stores, a premium and luxury concept run as a store-within-a-store to separate high-end beauty from the pharmacy floor. The format carries international brands, including Fenty Beauty, Prada, Hermès and Versace.
“We are extremely pleased with the performance of all the locations and expect more brands to be added as we continue to grow the luxury beauty category. We added premium brands, including Valentino, Burberry and Yves Saint Laurent,” Chang said.
On whether the two stores in Barbican, St Andrew, sit too close together, she said: “We are still adjusting the mix between the two locations, but are seeing significant growth at the Monarch Barbican location and feel confident they can coexist.”
CrichtonMullings & Associates gave the accounts an unmodified opinion. The board approved them on September 10.
luke.douglas@gleanerjm.com
