New annual report 2014

Contents Page 1 Our Company History

Our Mission, Our Purpose and Our Core Values

Financial Highlights

Page 5

Page 6 - 7

Page 8 - 11

Key Statistics ............................................................................................................................................. Page 8

Awards & Achievements

Page 12 - 13

Investors in People Gold ..................................................................................................................... Page 12

The Sunday Times Grant Thornton Top Track 250 List 2013 .................................................. Page 12

Training Award – Day Lewis Group at the Pharmacy Business Awards 2013 .................. Page 13

Business Leader of the Year – Kirit Patel at the Pharmacy Business Awards .................... Page 13

Group Strategy

Page 14 - 15

NHS Prescription Items Growth ........................................................................................................ Page 14

Pharmacy Services Growth ................................................................................................................ Page 15

Retail Sales ............................................................................................................................................... Page 15

Our People

Page 16 - 19

Developing Our People ....................................................................................................................... Page 16

Annual Conference ............................................................................................................................... Page 17

Healthy Living Pharmacy .................................................................................................................... Page 17

Investors in People Gold ..................................................................................................................... Page 18 Founders and Directors of Day Lewis PLC

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Page 20

Contents Page 2 Next Generation Directors

Page 21

Senior Management Team

Page 22 - 25

Other Business Activities

Page 26 - 27

Harrods Pharmacy ................................................................................................................................. Page 26

Wells Offshore ......................................................................................................................................... Page 26

Corporate Social Responsibility

Page 28 - 31

Day Lewis Charity Fun Day ................................................................................................................ Page 28

Dementia Friend ................................................................................................................................... Page 28

Race for Life 2013 ................................................................................................................................. Page 29

Other Humanitarian Schemes .......................................................................................................... Page 29

Healthy Living Workplace .................................................................................................................. Page 30

“Switch it Off� Campaign .................................................................................................................... Page 30

Inhaler Recycling ................................................................................................................................... Page 31

Strategic Partnerships .......................................................................................................................... Page 31

Financial Statements

Page 32 - 37

Consolidated Profit and Loss Account: Year Ended 31 March 2014 ................................... Page 34

Consolidated Balance Sheet: Year Ended 31 March 2014 ...................................................... Page 35

Consolidated Cash Flow Statement: Year Ended 31 March 2014 ........................................ Page 36 Consolidated Balance Sheet: Year Ended 31 March 2014 ...................................................... Page 37

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Helping People In The Community Stay Healthy And Feel Better Since 1975 Annual Report 2013-2014

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“...one pharmacy in Southborough to over 220...”

Our Company History Day Lewis Plc is one of the largest independent

pharmacy chains in the UK and Europe. Founded

by Kirit Patel MBE and his brother JC Patel in 1975, the company remains a family-owned entity today, having grown from one pharmacy in Southborough to owning and managing over 220 pharmacies in the UK today.

Day Lewis has employed over 2000 people and is predominantly based in the South of England, from Cornwall to Greater London. The company was recently awarded the management rights to the pharmacy concession in Harrods, the world famous department store in Knightsbridge, London.

“...pharmacy concession in Harrods...”

The group also contains a central distribution division, with warehouses equipped with Knapp automation, in order to supply pharmaceutical products to its retail pharmacies in the UK.

Throughout its dynamic history in community pharmacy and the business arena, Day Lewis has advanced from being a traditional retail pharmacy business, dispensing medication and offering retail products, into a patient-orientated service provider.

The company also provides a wide range of clinical services to its patients, and has subsequently earned the respect and friendship of not only industry peers, but also of local communities in which its pharmacies’ are located in.

The Chief Executive, Kirit Patel, is a renowned entrepreneur in the UK Pharmacy sector. His contribution to pharmacy and public service was recognised in 2005, when he was awarded an MBE by Her Majesty Queen Elizabeth II.

Going forward, Day Lewis aspires to grow through acquisition whilst still maintaining its independence and family culture.

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Our Mission

To be as large and successful as we can be, providing we maintain our core purpose and core values, and remain independent.

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Our Purpose

To help people in the community to stay healthy and feel better.

“...Our caring family culture�

Our Core Values To keep our caring family culture

To look after our customers

To be disciplined and professional

To be different through innovation

To reward, recognise and empower

To have fun

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Financial Highlights The directors are pleased to report another strong year of growth in sales and profitability across the Day Lewis Group. The company has continued with its acquisition policy, adding 11 new pharmacies to the group in the financial year. In total, there are 220 pharmacies owned and managed by Day Lewis as of March 2014. Day Lewis prides itself on its service led approach; putting the patient at the heart of its decisions is a key differentiator for the business enabling it to build a large base of loyal, recurring customers.

Key Statistics: Turnover:

Turnover in the year increased by 20% to £240.8M (2013: £200.7M). The increase in turnover was as a result of acquisitions of new pharmacies and an increase in prescription items.

Prescription Items: Prescription items increased by 7.2% (2013: 4.2%) and on a like-for-like basis the increase was 3.2% (2013: 2.5%).

Gross Margins:

Gross margins increased by £7.5M to £63.5M (2013: £56.0M). The percentage gross margin decreased by 1.5% to 26.4% (2013: 27.9%). A number of factors account for the decreased gross margin percentage which has been achieved despite the ongoing Government action to reduce reimbursement prices. These include a change in the mix of products purchased and sold, enhanced purchasing methodology and stock control processes and appraisals of individual store profitability.

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“...another strong year of growth in sales and profitability...”

240.83 193.00 178.03

192.70

200.69

“Turnover...increased by 20% to £240.8M...”

Administrative Costs:

Total administrative costs increased by £6.3M to £45.8M (2013: £39.5M). The business has enhanced its group infrastructure and support office function during the year to enable sustained future progress and growth.

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Operating Profits:

The Group achieved an operating profit of £18.1M (2013: £16.9M), a record result. Exceptional items relate to profit on disposals of pharmacies (2013: related to the onerous lease provision).

“...operating profit of £18.1M...a record result...”

48.16

49.61

52.98

55.96

63.52

Interest Costs:

Interest costs remain at equivalent levels to last year due to the hedge instruments in place, better cash management and use of the Citi NHS finance facility to reduce reliance on bank finance.

Net Debt and Gearing:

Net debt has decreased by £0.2M to £58.9M (2013: £59.1M).

Gearing ratio has reduced to 1.2 (2013: 1.6).

15.83 12.66

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16.56

18.55

20.01

8.32 6.14

9.53

6.62

3.65

Despite the challenging economic conditions, 2013/2014 marked a further year of significant profit growth for the Group. It is worth noting that over the last two years, gross profits of above 26% were achieved and operating profits increased by 7.2%. The directors are confident this trend will continue.

Outlook:

Despite the challenging economic conditions, 2013/2014 marked a further year of significant profit growth for the Group. It is worth noting that over the last two years, gross profits of above 26% were achieved and operating profits increased by 7.2%. The directors are confident this trend will continue.

“...gross profits of above 26%...directors are confident this trend will continue.”

Day Lewis is in the process of obtaining a further £30M in acquisition funding from its bankers to expand the pharmacy group. There are currently over 30 pharmacies being looked at for acquisition into Day Lewis PLC, over the next year. There are plans to spend significant investment and development in the warehousing operation, in order to double the automation in the warehouse, and increase the staffing headcount. Once this investment is complete, the warehouse operation will be placed to service over 400 pharmacies on a daily basis. There will be significant increase in the infrastructure of the retail operations team to support the pharmacies as the company continues to grow and support its patients’ needs.

Please see page 32 to 35 for the financial statements 2013 - 2014.

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Awards & Achievements Investors in People Gold Investors in People is a management framework for high performance through people and recognised as excellence on an international level. In March 2013, Day Lewis was proud to receive recognition as a Gold Investors in People accredited company, putting them in the top 3% for world-class business performance through its people.

The Sunday Times Grant Thornton Top Track 250 List 2013 For the third consecutive year, Day Lewis has been ranked in “The Sunday Times Grant Thornton Top Track 250 List”. The league table ranks the 250 largest private companies, provided either sales or operating profits have increased by at least 10% in their latest available accounts.

“250 biggest private companies...operating profits have increased by at least 10%...”

Sales range from £140m to £650m. Having moved up in position since the company was first listed, Day Lewis now sits at 145th place.

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“...top 3% for world-class business performance...”

Training Award – Day Lewis Group at the Pharmacy Business Awards 2013 The Pharmacy Business Awards recognises the industry’s excellent service to communities in the UK and is the pinnacle of events in the pharmacy calendar. Day Lewis is pleased to have been recognised as a company that provides the best training scheme for its employees, consequently empowering them to deliver exceptional service to patients throughout the UK.

“...best training scheme in the... healthcare industry”

Business Leader of the Year - Kirit Patel at the Pharmacy Business Awards 2013 Kirit Patel was voted as Business Leader of the Year in the pharmacy industry. This was a significant achievement, given that Day Lewis competes against corporate pharmacy chains as an independent pharmacy group.

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Group Strategy The Group’s strategy is to grow its existing core estate of retail pharmacies, either through acquisitions or joint ventures, and to provide a solid and efficient system of self-distribution to its pharmacies through its central distribution operation. This includes a continued drive to ensure an increase in cost reduction and efficiency programs, whilst still investing in its people to deliver local pharmacy services, to fulfil patient needs at a local level.

has continued with its tactical approach to relocations, which has consequently resulted in 50 health centre pharmacies co-located with GP practices.

Day Lewis also strives to seek out new areas of market growth that are closely aligned to the company’s core purpose. This strategy is underpinned by the company’s focus on customer care and patient safety, as well as strong financial management.

NHS Prescription Items Growth

“...focus on customer care and patient safety...”

Day Lewis is an independently owned pharmacy retail chain in the UK, with over 220 owned and managed pharmacies located across England. The company’s long term goal is to increase this number through a combination of value added acquisitions and new pharmacy contract opportunities. This year, Day Lewis

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The company has developed strategies for all the core parts of the business. The following sections describe the company’s strategies in recent years and entails details of the action that was taken in order to fulfil these strategies:

Day Lewis’ first and largest pillar of focus is NHS Prescription Items and, for the third year running, the company has had market beating like-for-like items growth. This was achieved through the addition of 21 pharmacies, relocating six others and a strong leadership focus on developing the company’s business.

In addition, as the Group recognises the importance of local engagement, Day Lewis now has representation on all LPCs (Local Pharmaceutical Committees) in the

“...retail sales have continued to grow.”

areas where it operates. In order to ensure strong local leadership that will benefit all contractors, the group also recently held the company’s second two day conference for all LPC members.

To drive efficiency within the company’s pharmacies, Day Lewis has developed a central dispensing support pharmacy to enable its pharmacy teams to focus on services delivery. The company has also introduced standardised processes and systems, which in turn aids patient safety. Moreover, each year, Day Lewis organises a patient safety week to enable all the company’s teams to focus on the critical elements of the company’s business.

Pharmacy Services Growth Moving on to pharmacy services, nearly all Day Lewis pharmacies achieved 400 Medicines Use Reviews last year, which is two and a half times the national average.

This is in addition to the group delivering thousands of New Medicines Service interventions.

“...nearly 400 Medicine Use Reviews per pharmacies...”

Other successes that the group has had include delivering 12,000 flu vaccinations during 2013/14 total.

“...delivering 12,000 flu vaccinations...”

In addition, all of the company’s pharmacies are now Healthy Living pharmacies and focus on local health priorities, including weight loss, smoking and alcohol reduction, healthy eating and sexual health.

Retail Sales Day Lewis’ total retail sales have continued to grow through continued focus creating a shopping environment that is appealing and easy to navigate.

The group has also rebalanced the spacing within all of the company’s pharmacies with new products and merchandising solutions, which has now resulted in a suite of planograms for P Meds, GSLs, medicated skincare products, vitamins, incontinence products, first aid products and foot care products.

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Our People Developing Our People Day Lewis is passionate about the learning and development of its people and understands the importance of motivating and engaging the workforce.

In 2012, the company launched an innovative and award-winning tool for empowering its colleagues in line with its core values. This is the ‘Day Lewis Academy’, which is available on the company intranet for all Day Lewis employees.

“...passionate about the learning and development of its people...”

Within the Academy, online training modules on subjects ranging from products to health and safety are available. Modules are created and made bespoke to the company by working closely with external partners. Employees are able to record the modules that they have studied and gain points for all learning, which consequently leads to certificates and rewards.

When an employee reaches 100 points they receive a bronze certificate, at 250 points a silver certificate and at 500 points a gold certificate, along with a £50 voucher. All certificates are signed by Kirit Patel.

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Furthermore, if the whole team in a pharmacy achieves gold certificates, then they will be rewarded with a meal out or an event, such as bowling. This supports the company’s core value: “To reward, recognise and empower”.

“...reward, recognise and empower.”

The Academy has successfully helped to engage and motivate colleagues in their learning and development activities, which has consequently ensured that pharmacy teams are skilled, knowledgeable and able to provide the best service to customers.

The Academy was outlined as a key achievement in the Investors in People report when Day Lewis was awarded the Gold Investors in People status in March 2013. The report author stated, “Your people absolutely love the fact that they can progress to different levels, are given certificates and can win prizes”. In addition, as a result of the Academy, Day Lewis won the Training Award at the Pharmacy Business Awards 2013 and the Business Initiative Award at the C&D Awards in 2014.

“...over 700 pharmacy colleagues and VIP guests...”

Annual Conference Day Lewis organises an annual conference for employees and commercial partners, which is traditionally held in London. Lasting for an entire weekend, the conference is a highlight of the company calendar and provides a great opportunity for over 500 employees to network with their peers and to acquire additional skills through training seminars led

by FMCG companies.

This fulfils the aim of exposing them to the latest service and product developments. The conference is always carefully planned to include sessions and activities to benefit all attendees, which are led by industry leaders and those from Day Lewis.

This year, on the weekend of 23rd-24th November 2013, Day Lewis Pharmacy hosted their 18th annual conference at the Novotel London West hotel. The event was attended by over 700 pharmacy colleagues and VIP guests not just from across the industry, but also from the political and finance worlds, which reflects the company’s ever growing status in the pharmacy industry and as an independent company.

Sue Sharpe from the PSNC was the chief guest at the event.

The theme for this year’s conference was “Healthy Living Pharmacy”, which echoed Kirit Patel’s statement that, as a company, Day Lewis’ aim is “to play a leading role in local communities by offering healthy living advice and relevant services to [its] customers.”

“...play a leading role in local communities...”

The weekend comprised of various sessions to inform guests of the company’s Healthy Living strategy and train Day Lewis delegates to provide a wider range of health services, in addition to a 007 Bond themed gala dinner on Saturday evening. Sunday was centred on the annual exhibition, in which guests were able to speak to over 30 suppliers from the industry. Overall, Day Lewis is proud to affirm that their 18th annual conference was enjoyed by all.

Healthy Living Pharmacy As part of the Pharmacy Business Plan for 2013/2014 Day Lewis committed to, and delivered, three key objectives:

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•

• •

To multi-skill pharmacy colleagues so that all Counter Assistants are also Dispensers and vice versa, in order to ensure that they can fully support each other and provide consistent service to customers.

To train all pharmacies to be Healthy Living pharmacies.

To provide all pharmacists with specific leadership training.

The ethos of Healthy Living pharmacies complements the group’s own core purpose and values, and the company has now cultivated a culture of proactiveness in increasing awareness of healthy living.

This is done by offering advice and services to help improve the health of local communities.

“...cultivated a culture of pro-activeness...”

Pharmacists’ management capabilities have been at the top of Day Lewis’ agenda. Skills are not only developed through initiatives such as Healthy Living Pharmacy (HLP) leadership training and continued support from the company’s partners, but also by encouraging pharmacists to complete Centre for Pharmacy Postgraduate Education management packages, attend management webinars and receive support from their Regional Support Managers.

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Day Lewis also continues to expand its service provisions through classroom influenza vaccination service training and online training for Patient Group Directions.

Investors in People Gold Investors in People is a management framework for high performance through people and recognised as excellence on an international level.

Day Lewis achieved bronze accreditation in 2010 and the group took the opportunity to use the framework to put further improvements in place.

In March 2013, Day Lewis was proud to receive recognition as a Gold Investors in People accredited company, putting them in the top 3% for world-class business performance through its people.

The company used the assessment as an opportunity to evaluate and gain some in-depth feedback in some of the key areas of the business and to ascertain how they can continue to improve. This focused on devolution into the field, the effectiveness of strategies, learning and development and engagement with our

“...recognised as excellence on an international level...”

Corporate Social Responsibility.

Feedback from the Review:

“Day Lewis’ company culture, despite significant expansion, has become stronger and more credible.

The CEO and his management team are ambitious and self-critical, engaging in a great deal of self-review and benchmarking to help drive strategies. Management pays equal attention to good business and people practices, which are instrumental to its success.”

“Day Lewis’ company culture...has become stronger...”

“Despite growth and expansion, Day Lewis has not only kept its culture, but it appears to have grown even stronger. That’s down to better managers and more focus on good practices.”

Many more employees think in a commercial yet caring way. Customer service is at the forefront of people’s minds, followed closely by maximising the potential of their pharmacy. Indeed, pharmacies confirm that they are well-supported and informed in order to drive their pharmacies.

Key Achievements:

A forward looking, self-critical and dynamic top management style ensures that the company always

‘stays one step ahead’. The company also endeavours to create comprehensive synergistic strategies that deliver the CEO’s goals and vision. In addition to this, Day Lewis takes pride in generating a high level of trust, care and respect for employees, whilst supporting a culture that genuinely values learning.

“...trust, care and respect for employees...”

This has consequently resulted in a competent, capable and motivated workforce that is able to deliver the expectations that are placed upon them. It has also led to remarkable levels of loyalty to the business.

With such positive results in employee development, there is subsequently good evidence of a continuous improvement culture, which pushes the group to regularly review and enhance its working practices.

Continuous Improvement:

Day Lewis understands the importance of continual development, and with the growth of the business the company recognises that it still has areas to work on. To do so, the company will continue to use the IIP framework. Certainly, it has become an integral part of the way in which colleagues work, which involves checking and reviewing each step in processes and development and ensuring the well-being of those who work at Day Lewis.

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Founders and Directors of Day Lewis Kirit Patel MBE FRPharmS., MBA, DipPhil, FIMgt | CEO

Kirit Patel MBE is one of the UK’s most recognised pharmacy entrepreneurs. He has over 39 years of retail pharmacy experience, and has grown the company from two pharmacies in 1975 to over 240 pharmacies in the UK. Aside from his position within Day Lewis, Kirit has held significant roles in various pharmacy associations, such as the Royal Pharmaceutical Society of Great Britain and the Association of Independent Multiple Pharmacies.

Prior to his career in pharmacy however, Kirit graduated from Portsmouth University with a degree in pharmacy and also holds degrees from Westminster University, Brighton University and the University of Pennsylvania.

Kirit’s most memorable moment at Day Lewis so far is being named Member of the Order of the British Empire from Her Majesty Queen Elizabeth II, for his services to the Pharmacy industry.

During his lifetime, he would like to follow up his overland journey from London to Cape Town and travel right through the heart of Africa.

JC Patel, MSc | Company Secretary

JC Patel was born in Kisumu, Kenya. He went to India in 1964, where he graduated from Gujarat University with an MSc degree in Physics.

He returned to Kenya in 1970 to enter the teaching profession.

In May 1975, he and his brother, Kirit, formed a limited company, which acquired two pharmacies in Tunbridge Wells, Kent.

In 1976, he moved to the UK to help with the family business. He became a Sub Postmaster in Hammersmith until 1979, when he moved over to manage the retail pharmacies for Day Lewis. JC is now Company Secretary, in addition to being the Sub Postmaster of the four post offices within the Group.

JC’s most memorable moments at Day Lewis so far was when Day Lewis acquired their 100th shop, and when the company also reached their silver anniversary. During his lifetime, he would like to go on a cruise tour around the world.

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Next Generation Directors Jay Patel, MRPharmS | CIO & Director

Jay holds a master’s degree in pharmacy from Portsmouth University and joined Day Lewis in August 2004. He is currently enrolled on the Executive MBA programme at Cass Business School, London.

His most memorable moment at Day Lewis so far is managing the turnaround of the ABC Pharmacy Group after it was acquired by Day Lewis in 2010. He is also proud of having won the Chemist & Druggist National Manager of the Year award in 2012.

During his lifetime, Jay would like to achieve several things, which include gaining his private pilot’s licence, running a marathon and taking six months off work to travel the world.

Dr Rupa Patel, BDS, MBA | Property Director

Rupa qualified from King’s College London with a Bachelor of Dental Surgery degree. However, following the attainment of a master’s degree in Real Estate and an MBA from Cass Business School, Rupa has since become the Managing Director of QH Estates Ltd and also joined Day Lewis in 2007 as Property Director.

Rupa’s most memorable moment at Day Lewis so far is completing office and warehouse acquisitions and overseeing expansion works.

During her lifetime, she would like to gain a Helicopter’s Private Pilot Licence, with the view to do aerial property inspections.

Sam Patel, MA (Oxon), MBA, ACA | Director

Sam qualified as a Chartered Accountant, after graduating from Oxford University, and joined Day Lewis in April, 2012. Having a background in economics, accounting and management, Sam has previously worked for PricewaterhouseCoopers and Safetykleen Europe Ltd. He has been admitted to the prestigious MBA programme at INSEAD Business School.

Sam’s proudest moment at Day Lewis so far is hosting the annual conference gala dinner.

During his lifetime, he would like to go heli-skiing in Jackson Hole, USA.

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Senior Management Team Ameet Patel, FCCA | Accountant

Ameet was born in Nairobi, Kenya. He completed his education there, and also qualified as a Chartered Certified Accountant after completing a correspondence course in 1976. Ameet has previously worked at John Cummings as a Senior Auditor and what was then known as Dales Southend Ltd as a Chief Accountant. Ameet joined Day Lewis in 1983.

Ameet’s fondest memory at Day Lewis is receiving the 25 year service award at the Day Lewis Conference in 2009.

During his lifetime, he would love to visit Australia and New Zealand.

Carey Edwards, FRAeS, BA (Hons), BSc (Hons) | Non Executive Chairman

Carey has been an advisor to Day Lewis since 1995. He graduated from Wharton Business School and was a management trainee with Royal Dutch Shell. This was then followed by a diverse career initially as an RAF helicopter squadron flight commander, and then various senior management positions; including a member of the executive team of the Peninsula Hotel Group and CEO of Gaastra Holdings. Currently, he is Managing Director of LMQ, a strategic planning and training consultancy.

Carey’s proudest moment at Day Lewis is establishing the company’s mission, core purpose and core values. During his lifetime, he would like to sail across the Atlantic.

Colin Kendrick | Head of IT

Colin is a highly accomplished commercially-aware Head of IT with a proven track record spanning over 15 years within Retail, FMCG, Healthcare as well as Outsourced Managed Services. Before joining Day Lewis in October 2011 Colin was Head of IT at several companies including ADP Dental, Tiger Beer UK, Ubevco and CTS. Colin’s proudest moment at Day Lewis so far is being recognised for his contributions to the company and being placed on the Next Generation Board as well as the Senior Management Team.

During his lifetime, Colin would like to learn to play the guitar well enough to play in public and achieve a single figure golf handicap.

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Senior Management Team Heena Patel, BA (Hons), ACA | Finance Director

Heena is a member of the Institute of Chartered Accountants in England and Wales having qualified with Halpern and Woolf in 1988.

In her career, Heena has headed up business finance functions for a number of entrepreneurs and was also the Finance Director at Glebe Asset Management.

Having joined Day Lewis in October 2011, Heena’s proudest moment is successfully negotiating a five year bank club facility that has enabled the company to achieve its ambitions to grow both the distribution and retail businesses.

During her lifetime, she would like to see a tiger in the wild.

Ian Adamson, BA (Hons) | Commercial Advisor to the Board

Ian joined Day Lewis in September 2013. In addition to being NonExecutive Director for Day Lewis, Ian is the Director for L4 Consulting Ltd and Handsome Ltd, as well as Advisor to the Board for Reva Health.

Prior to these positions, Ian worked as the Main Board Director and Chief Operating Officer at SSL International Plc. Ian’s most memorable moment at Day Lewis was when he was invited

by Kirit to join the company.

During his lifetime, Ian would like to follow as many British & Irish Lions rugby tours as possible.

Nigel Brewster, BSc, ACA | Finance Advisor to the Board

Nigel is currently CFO of Park Resorts Limited, the largest operator of UK holiday parks. Nigel became involved with Day Lewis in January 2010. Prior to his current role, Nigel held several positions as Finance Director and other senior management roles, at companies such as Gala Coral, SFX Entertainment and ADP Dental Group.

Nigel is proud to be able to assist the board in managing their banking relationships so that the business can continue to grow.

During his lifetime, he would like to follow an Ashes tour in Australia.

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Senior Management Team Peter Glover, MRPharmS | Pharmacy Superintendent

Peter holds a degree in pharmacy from the University of Wales Institute of Science and Technology. Before joining Day Lewis in June 1987, Peter worked for 15 years at Boots as a Store Manager and Pharmacy Superintendent. He has also previously owned six pharmacies.

Peter’s proudest moment at Day Lewis is when Kirit received the award of Member of the Order of the British Empire.

During his lifetime, he would like to own a Maclaren 650S.

Raymond Barclay, MRPharmS | Head of Support Services

Raymond is a qualified pharmacist. However he has spent the majority of his career in senior management roles within companies including Guinness Retail and AAH Retail/Lloyds Pharmacy.

Having worked for Day Lewis since September 2005, Raymond’s proudest moment is helping the company to move into a new modern office and overlooking the installation of the automation in the new warehouse. This was a major milestone which signified the company’s ability to grow into a significantly larger business.

During his lifetime, Raymond would like to spend a month touring the west coast of America, in particular California.

Shimal Patel, MSc, BSc (Hons) | Head of Marketing

Shimal joined Day Lewis in November 2004 after graduating from Aston Business School, where he attained a master’s degree in Business & IT. He also holds an undergraduate degree in Economics & Finance from University of Southampton, and has also attended residential executive development courses at Cranfield School of Management and Ashridge Business School. He is also a member of the Next Generation Board.

Shimal’s most memorable moment at Day Lewis is when his Marketing department were finalists for the “Team of the Year” category at an industry awards event.

During his lifetime, he would like to appear on BBC’s Masterchef.

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Senior Management Team Taybi Mohamedbhai, MRPharmS | Head of Procurement

Taybi is a qualified pharmacist and graduated from Brighton University.

Prior to joining Day Lewis in October 1982, Taybi worked for Boots as a pre-registration pharmacist and relief manager for the South Eastern area. He is one of the longest serving members of the company.

Taybi’s most memorable moment at Day Lewis so far is founding Day Lewis’ annual conference alongside fellow colleagues, and he is proud to see how it has evolved over the years.

During his lifetime, he would like to visit a few geographical wonders, such as Mount Everest.

Tim Harrington, MBA | Head of Commercial Development

Tim is a graduate of the Wharton Business School and has also completed an MBA at Kingston University in 1999. However his experience in the UK pharmacy industry began in 1991 at what was then known as UniChem Ltd. He later became the Chief Accountant of Moss Pharmacy, which is now known as Alliance Boots. During this time, Tim helped the company to grow from 92 to over 220 pharmacies in the UK. In December 2005, he joined Day Lewis as a Commercial Manager, with the responsibility of finance and business development.

During his lifetime, he would like to gain a history degree and go on a cricket tour in the Caribbean.

Tim Rendell, FFRPS, MRPharmS | Head of Pharmacy

Tim is a qualified pharmacist and has held a variety of senior management positions over a career spanning 29 years at Alliance Boots. He joined Day Lewis as Head of Pharmacy in 2010 and leads the pharmacy teams across the country. Tim holds several external positions including Chair of the Executive Operational Board at CPPE, University of Manchester and Vice Chairman at Surrey Local Pharmaceutical Committee. He is also a fellow of the Faculty of the Royal Pharmaceutical Society.

Tim’s most memorable moment at Day Lewis was leading a session for 600 company colleagues at the Day Lewis Annual Conference.

During his lifetime, he would like to learn how to play the piano.

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Other Business Activities Harrods Pharmacy

Day Lewis Pharmacy is proud to have acquired management rights of the pharmacy in Harrods, one of the world’s most famous department stores in Knightsbridge, London. The new pharmacy started trading on Monday 30th September 2013, on the lower ground floor of the building.

“...one of the world’s most famous department stores...”

Kirit Patel MBE, the founder and chief executive of Day Lewis, said “We are proud of our heritage as being a leading family business delivering innovative, professional pharmacy services in the communities we serve. We invest heavily in training our pharmacy teams, as endorsed by our Investors In People Gold accreditation. There is no greater endorsement than being trusted to manage the Pharmacy in Harrods, a world renowned store.”

Wells Offshore In addition to owning over 220 pharmacies, Day Lewis owns Wells Offshore, Europe’s largest international offshore and remote clinic distribution business. Serving the likes of BP, Chevron and Total, Wells Offshore supplies a full range of licensed pharmaceuticals, surgical dressings, items of medical equipment and furniture required for offshore oil installation sick bays.

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“...supplies... for offshore oil installation sick bays.”

“...Europe’s largest international offshore and remote clinic distribution business..”

Examples include: rescue stretchers, emergency equipment and life saving apparatus such as a full range of heart defibrillators. We can fit out entire clinics and sick bays and provide remote healthcare formularies.

Being distributors for a large number of manufacturers of medical equipment and first aid consumables enables the company to provide competitive pricing and product support. Wells Offshore is managed and run locally by a dedicated team of pharmacists and staff, who have significant experience of dealing with the needs of the oil and merchant shipping industries.

The company is also a trusted supplier for commercial and passenger shipping sick bays, occupational health sick bays, remote onshore site sick bays, wind farm sick bays and international medical centres in remote locations.

Wells Offshore procures globally across six continents.

Our team sources generic medicines, branded products and OTCs throughout Europe in order to serve 14 million patients annually each year. We also have strong relationships with UK wholesalers, to procure and sell all types of medicines globally.

To find out more, please visit: http://www.wellsoffshore.co.uk/

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Corporate Social Responsibilty Day Lewis Charity Fun Day As part of Day Lewis’ commitment to the community, pharmacies are encouraged to support local charities and sponsor local events and causes.

In 2013, Day Lewis established the Annual Charity Fun Day, in which all its pharmacy, support office and warehouse teams are invited to participate. All teams raised money for a local charity of their choice, to ensure that the company as a whole is able to support as many charities as possible.

Pharmacy teams raised money through activities such as cake sales and raffles. Within the support office and warehouse, employees engaged in a variety of activities during a dedicated fund-raising week.

Kirit himself personally opened up his office to host activities such as table tennis, table football and darts matches.

Overall, responses from staff members were incredible, with Day Lewis employees raising £50,000. This was then generously matched by Kirit and his family, resulting in a total of £100,000 being donated to local charities.

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“...£100,000 raised for local charities...”

Dementia Friend At its annual conference in 2013, Day Lewis invited Anne Cole, associate of the Centre for Pharmacy Postgraduate Education, to deliver a session for all attendees to understand what dementia is, how it manifests and what they can do as individuals and as a society to help dementia patients. Attendees were also taught how to recognise the early signs of dementia and the little things that can be done to ease dementia related distress.

As a result of this session, all attendees, including a large majority of the Day Lewis team, are now Dementia Friends. Many of the Group’s pharmacies and staff members have since strived to link up with local dementia groups and raise awareness of dementia.

“...majority of the Day Lewis team are now Dementia Friends.”

“...staff members were incredible... raising £50,000”

Race for Life, 2013 In July 2013, 32 colleagues from the support office and warehouse took part in the Race for Life event held at Lloyds Park in Croydon. The ladies ran a distance of 5 kilometres and raised a combined total of £4,000 for Cancer Research UK. Kirit and his family once again generously matched this total. Consequently, a grand total of £8,000 was donated to the Chartwell Cancer Trust.

Other Humanitarian Schemes Day Lewis continually strives to behave ethically whilst improving the quality of life of the workforce, their families, local communities and society at large.

Community: The group helps local communities by providing services that support its customers. These include the company’s delivery service, supporting Careers Week and fundraising for local charities.

Environment: Day Lewis helps to look after the environment through recycling bins, reducing their carbon footprint and their Cycle to Work Scheme.

The company is also involved in an inhaler recycling scheme in partnership with GSK, in addition to recycling batteries.

Workplace: The company is committed to looking after and listening to its employees through the use of staff satisfaction surveys, listening forums, training and health and safety procedures. The launch of the Day Lewis Academy which recognises and rewards people for their development is an excellent example of this.

Marketplace: Day Lewis endeavours to offer excellent customer service and be a preferred industry supplier and partner. This includes care home medication management, a repeat prescription collection and delivery service, working closely with the company’s suppliers and working alongside pharmacy bodies such as the NPA to develop the innovative PGD service.

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Healthy Living Workplace In support of the Group’s caring family culture and as a health care provider offering healthy living advice to our pharmacy customers, Day Lewis encourages its colleagues and their families to focus on healthy living behaviour. This also provides an opportunity for education on particular areas such as exercise or smoking cessation, which pharmacy teams can then share with the company’s customers.

“...Day Lewis encourages its colleagues and their families to focus on healthy living...”

Such initiatives have included a ‘10,000 Steps a Day’ challenge after the new year where all colleagues were given a pedometer and an online recording form to record their steps. Together, Day Lewis colleagues managed to walk a total of 26,463,747 steps.

Another initiative this year included working with NHS England to create an online tool for employees to use

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during their smoking cessation attempts throughout Stoptober. This tool offered a multitude of motivational tips and insights to keep them going for the whole of the 28-day challenge.

Day Lewis will continue to develop these initiatives and look to work with national campaigns that can provide resources, education and tools to support its healthy living workplace.

“...Day Lewis will continue to develop these initiatives...”

“Switch it Off” Campaign “Switch it Off” week traditionally takes place each autumn and culminates in the Big Switch Off on the Friday of the week. Before the week, stickers are sent out to all pharmacy branches to be placed by sockets, taps, air conditioning switches and heaters to remind staff members to switch them off when they are not in use. These stickers are also placed around the support office. Nevertheless, in an attempt to promote

“...reduce the impact...caused by...disposal of inhalers.”

environmental friendliness and to encourage positive action on climate change, the company strives to conserve energy throughout the year.

Inhaler Recycling Since 2012, Day Lewis has been participating in GSK’s “Complete the Cycle” scheme, which aims to reduce the impact on the environment caused by the landfill disposal of inhalers. Indeed, the components of inhalers which cannot be recycled are recovered and converted into electricity or heat using the ‘waste to energy’ process.

The scheme is a fantastic fit with the Day Lewis brand.

The Group’s collaboration with GSK has benefited patients by reassuring them that their inhalers are responsibly recycled, and also contributes to Day Lewis’ CSR strategy. It also demonstrates that the company is truly helping people in the community to stay healthy and feel better, as they are moving towards a more environmentally sustainable treatment of respiratory diseases.

“...inhalers are responsibly recycled...helping people in the community...”

Day Lewis is proud to affirm that, since the beginning of its participation in the scheme, they have collected over 19,000 inhalers, thus saving 135 tonnes of CO2 equivalents.

Strategic Partnerships Day Lewis actively promotes strategic partnerships with all of its business partners, working collaboratively wherever possible. Whilst the company encourages all of its patients and colleagues to live healthy living lifestyles, it also encourages all of its business partners to do likewise.

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Profit and Loss

Balance Sheet

32

Financial Statements 2013/2014

t

Cash Flow Statement

33

CONSOLIDATED PROFIT AND LOSS ACCOUNT: YEAR ENDED 31 MARCH 2014

2014

£000

TURNOVER

240,830

Cost of sales

(177,315)

2013 £000

200,686

(144,725)

GROSS PROFIT 63,515

55,961

(20)

(19)

(45,810)

(39,089)

Distribution costs

Administrative expenses Exceptional administrative expenses

Total administrative expenses

187

(444)

(45,623)

Other operating income

(39,533)

406

472

OPERATING PROFIT 18,278 16,881 Interest receivable and similar income Interest payable and similar charges

82

45

(5,535)

(5,434)

PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION

12,825

Tax on profit on ordinary activities

(3,107) (2,992)

PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION

9,718

8,500

(178)

9,529

8,322

Minority interests (189) PROFIT FOR THE FINANCIAL YEAR

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11,492

CONSOLIDATED BALANCE SHEET: YEAR ENDED 31 MARCH 2014 2014

2013

Note £000 £000 £000 £000

FIXED ASSETS

Other intangible assets

79,157

Goodwill

3,974

4,077

Negative goodwill

(188)

(220)

Net goodwill

3,786

3,857

71, 008

82,943

74,865

Tangible assets

6,394

6,304

Intangible assets

Investments 177 183

89,514 81,352 CURRENT ASSETS Stocks

24, 943

18,283

Debtors

42,360

39,994

Cash at bank 7,499 6,114

74,802 64,391

CREDITORS: Amount falling due within one year (74,742) (67,839)

NET CURRENT ASSETS/(LIABILITIES) 60

TOTAL ASSETS LESS CURRENT LIABILITIES 89,574 CREDITORS: Amount falling due after more than one year

(3,448) 77,904

(38,989)

(37,097)

Deferred Tax

(2,920)

(2,745)

NET ASSETS

47,665

38,062

PROVISIONS FOR LIABILITIES

CAPITAL AND RESERVES Called up share capital

100 100

Share premium account 418 418 Merger reserve 757 757 Profit and loss account

45,595

36,066

SHAREHOLDERS’ FUNDS

46,870

37,341

795

721

47,665

38,062

MINORITY INTERESTS

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CONSOLIDATED CASH FLOW STATEMENT: YEAR ENDED 31 MARCH 2014

2014

£000

Net cash flow from operating activities

£000

18, 417

Returns on investments and servicing of finance Taxation

Capital expenditure and financial investment

2013

15,940

(5,569)

(5,489)

(3,169)

(3,045)

(2,514)

(1,250)

Acquisitions and disposals (6,911) (4,278)

CASH INFLOW BEFORE FINANCING 254

1,878 Financing

(DECREASE)/INCREASE IN CASH IN THE YEAR

36

(1,872)

(1,618)

2,653 4,531

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/DEBT: YEAR ENDED 31 MARCH 2014

2014

£000

(Decrease)/Increase in cash in the year

2013 £000

(1,618)

4,531

Cash outflow from decrease in debt and lease financing

1,872

(2,653)

CHANGE IN NET DEBT RESULTING FROM CASH FLOWS

New finance lease

254

1,878

(58)

MOVEMENT IN NET DEBT IN THE YEAR

Net debt at 1 April 2013

(59,147)

NET DEBT AT 31 MARCH 2014

(58,951)

-

196 1,878

(61,025)

59,147

37