By David Winning
SYDNEY – Drug wholesaler Sigma Healthcare Ltd warned on profits after experiencing problems with the introduction of the enterprise planning resource system at a time when major Australian cities were being closed to contain the COVID-19 outbreak .
Sigma said it now expects underlying earnings before interest, taxes, depreciation and amortization to decline by about 10% in the 12 months through January. As recently as September, the company was forecasting 5% growth.
“Total ERP upgrades are a critical change management program for any company, and while we got this project comprehensively on budget and on time through a pandemic to get it live, we’ve tried to complete implementation through heights. have faced additional challenges in the context of the COVID-19 restrictions,” said Jeff Sales, Sigma’s interim chief financial officer.
Sigma said it expects $25 million-A$30 million in one-time costs arising from the shock, and this will be impacted when its net debt peaks.
“We are confident that the actions already taken and the progress in progress with our ERP implementation will address technical challenges that are largely limited to FY 2022,” Mr. Sales said. “However, these issues have impacted sales in FY2022 that will flow through FY2023 sales, the impact of which is expected to subside as we move through FY2023.”
Write to David Wining at [email protected]