Annual Report 2022
Enabling Healthcare
U
n
i
p
h
a
r
p
l
c
A
n
n
u
a
l
R
e
p
o
r
t
2
0
2
2
ENABLING POSSIBILITIES
OPERATIONAL AND FINANCIAL HIGHLIGHTS
OVERVIEW
STRATEGIC REVIEW
PERFORMANCE REVIEW
GOVERNANCE
FINANCIAL STATEMENTS
OVERVIEW
Operational and Financial Highlights
Uniphar at a Glance
Our Mission, Vision and Culture
Investment Case
Chairman’s Report
STRATEGIC REVIEW
Chief Executive’s Report
Our Strategy
Our Business Model
Key Performance Indicators
People & Culture
Risk Management
Sustainability and Governance Report
PERFORMANCE REVIEW
Financial Review
Commercial & Clinical
Product Access
Supply Chain & Retail
GOVERNANCE
Company Information
Board of Directors
Corporate Governance Statement
Corporate Governance Report
Audit, Risk and Compliance Committee Report
Nominations, Governance and Sustainability
Committee Report
Remuneration Committee Report
Directors’ Report
FINANCIAL STATEMENTS
IIndependent Auditors’ Report
Group Income Statement
Group Statement of Comprehensive Income
Group Balance Sheet
Company Balance Sheet
Group Cash Flow Statement
Company Cash Flow Statement
Group Statement of Changes in Equity
Company Statement of Changes in Equity
Accounting Policies
Notes to the Financial Statements
Alternative Performance Measures
Glossary of Terms
2
3
5
7
9
15
19
21
23
25
27
36
57
61
63
65
68
69
71
72
81
87
91
104
113
122
123
124
125
126
127
128
129
130
142
207
212
Enabling
Healthcare
through
Connectivity
STRATEGIC REVIEW
p14
Enabling
Sustainability
through
Strategy
SUSTAINABILITY AND
GOVERNANCE REPORT
p36
Enabling
Healthcare
through
Technology
PERFORMANCE REVIEW
p56
Providing expertise
throughout the
product lifecycle
Divisional Reports
Commercial
& Clinical
p61
Product
Access
p63
Supply Chain
& Retail
p65
A Strong Performance
The Group delivered a strong performance in 2022
against a backdrop of a challenging macro environment.
FINANCIAL MEASURES
Global Expansion3
4
Four acquisitions announced
across USA, Europe,
Asia Pacific and Ireland
Gross Profit
+11.7%
2022: €306.7m
2021: €274.5m
ROCE1
+17.3%
2022: 17.3%
2021: 17.6%
Adjusted EPS1
+13.2%
2022: 18.4c
2021: 16.2c
EBITDA1
+13.4%
2022: €98.0m
2021: €86.5m
LEVERAGE1
1.0x
2022: 1.0x
2021: 0.7x
NON-FINANCIAL MEASURES
Progressive Dividend
+4.8%
2022: €4.8m
2021: €4.5m
Organic Growth2
+5.7%
2022: 5.7%
2021: 8.5%
Financial Review
Read more on page 57
Sustainability & Governance Report
Read more on page 36
Sustainability
Continued progress against
the five sustainability pillars
with a score of ‘B’ achieved
in CPD 2022 submission
(2021: ‘C’)
Community –
Unity@Uniphar
Fundraising initiatives to raise
funds for cancer charities
around the world and funds and
medical supplies for Ukraine
People
Resource Groups launched
» Rainbow Alliance
» Women’s Alliance
1 The Group uses Alternative Performance Measures (‘APMs’) which are not defined under International Financial Reporting Standards
(‘IFRS’) to monitor the performance of the Group and its operations. These APMs, along with their definitions and reconciliations to IFRS
measures are included in the APMs section on pages 207 to 211.
2 Organic gross profit growth is calculated as the gross profit growth of the underlying business in the period adjusting for the contribution
from prior year acquisitions and divestments to ensure a like-for-like comparison.
3 The Group also acquired five independent community pharmacy’s (ICPs) and one retail business all of which are individually not
substantial for separate disclosure. Further details may be found in Note 35 to the Financial statements.
3
2
UNIPHAR AT A GLANCE
A Global Reach
EBITDA
€98.0m
Gross Profit
€306.7m
ROCE
17.3%
2022: €98.0m
2021: €86.5m
2020: €66.7m
2020
2021 2022
2022: €306.7m
2021: €274.5m
2020: €217.3m
50
0
2020
2021 2022
2022: 17.3%
2021: 17.6%
2020: 18.7%
20
15
10
5
0
Commercial & Clinical
Product Access
Enabling patient access to treatments across
MedTech and Pharma industries.
Enabling equitable access to unlicensed
medicines worldwide.
Gross Profit
€118m 2021: €104m
Gross Profit Growth
+12.6% 2021: 13.2%
Gross Profit
€50m
2021: €41m
Gross Profit Growth
+21.4% 2021: 35.8%
7.1% Organic Gross Profit Growth
15
c. 60% Gross Profit generated outside of Ireland
Number of countries operating in
7.0% Organic Gross Profit Growth
160+ Number of countries operating in
10
New EAP’s awarded in 2022
2020
2021 2022
Supply Chain & Retail
Enabling the supply of medicines in Ireland.
A diversified healthcare services
business focused on growth
Summary Financial Results – Financial Year Ended 31 December 2022
Growth
Year ended 31 December
2022
€’000
2021
€’000
Reported
Constant
currency2
Revenue
Gross profit
Gross profit margin
EBITDA1
Operating profit
Profit before tax excluding exceptional items
Net bank debt1
Basic EPS (cent)
Like for like adjusted EPS (cent)1
2,070,669
1,943,149
306,744
274,497
14.8%
98,040
53,155
57,900
14.1%
86,481
45,147
50,444
(91,217)
(48,297)
16.7
18.4
17.8
16.1
6.6%
11.7%
13.4%
17.7%
14.8%
6.3%
10.8%
12.5%
17.0%
14.0%
1. Additional information in relation to Alternative Performance Measures (APMs) are set out on pages 207 to 211.
2. Constant currency growth is calculated by applying the prior year’s actual exchange rate to the current year’s result.
Gross Profit
€139m 2021: €129m
Gross Profit Growth
+7.9%
2021: 36.1%
4.1% Organic Gross Profit Growth
53% Market Share
386
Retail Pharmacy Network (Dec 22)
45%
Divisional Gross Profit
Commercial & Clinical
Product Access
Supply Chain & Retail
39%
16%
Integrated Model
Delivering M&A
ESG Performance
Our complementary businesses
work together to support our
manufacturer customers throughout
the product lifecycle.
Four acquisitions announced with
a strong strategic fit, broadening
our geographic reach, expanding
our consultancy capabilities and
increasing our market share.
Continued progress across
all five Sustainability Pillars and
improved CDP score in 2022.
Read more on page 37
Global Footprint
Active in 2022
Medium term expansion
3
4
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
OUR MISSION, VISION AND CULTURE
Mission
We are focused on improving patient
access to pharmaco-medical products and
treatments by enhancing connectivity between
manufacturers and healthcare stakeholders
Vision
Improve patient access to
pharmaco-medical products and therapies
Culture
OUR CULTURE PILLARS
Uniphar has a
‘people first’ approach
– we always do the
right thing
Adaptability,
commitment and
resilience and a strong
entrepreneurial spirit
Trust is at the heart of
how we operate
We love what we do for
our clients and we have
fun working together
to get it done
Common purpose
connects our diversified
businesses and people
5
6
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS INVESTMENT CASE
Our Strong
Investment Case
Uniphar is a diversified healthcare
services business focused
on improving access to
pharmaco-medical products
and therapies.
Our broad service offering,
deep manufacturer relationships
and clear strategy for growth
offers a strong investment case.
OVERVIEW
STRATEGIC REVIEW
PERFORMANCE REVIEW
GOVERNANCE
FINANCIAL STATEMENTS
Experienced
Industry Team
» Executive management with deep relevant industry
experience, working together with technical expertise
and further enhanced by strong specialist
market experience
» Clinically trained teams across the Group,
possessing deep knowledge of their therapeutic areas
» Increasing demand for speciality products
and advanced therapies
» Continued growth in outsourcing by manufacturers
Compellling
Market Opportunity
» Increasingly complex regulatory environment,
especially across the highly fragmented
European market
» A pan-European Commercial & Clinical service
offering for our manufacturer clients
» A multi-geography platform and expanded
service offerings for new and existing manufacturer clients
Platform for Growth
» Growth in our Product Access and Commercial & Clinical
services on a global basis
» Strong free cash flow generation delivering growth
» Robust liquidity position with capital allocation
prioritised to support sustainable organic growth,
accretive M&A and a progressive dividend policy
Cash Generation
» End-to-end solutions across the value chain
from early-stage development throughout the
product life cycle
Integrated Model
» Leveraging of existing capabilities, technology,
relationships and infrastructure, to expand our service
offering to customers across geographies and products
» Long-standing manufacturer relationships
» Sophisticated digital capabilities
» High-tech distribution infrastructure
Competitive Edge
7
8
UNIPHAR PLC ANNUAL REPORT 2022 CHAIRMAN’S REPORT
Our Culture Drives
our Performance
Maurice Pratt
Chairman
Uniphar’s operational and financial
performance demonstrates the
strength of the Group’s integrated
business model.
OVERVIEW
STRATEGIC REVIEW
PERFORMANCE REVIEW
GOVERNANCE
FINANCIAL STATEMENTS
Performance Review
Read more on page 56
Financial Review
Read more on page 57
€2.1bn
Group revenues across the three
divisions increased to €2.1bn
€57.9m
Group profit before tax and
exceptional items up 14.8%
to €57.9m
5.7%
Organic gross profit growth
achieved in 2022
In the time since IPO, we have
strengthened the independence of
our Board and widened the expertise
and experience of its members.
The work of the Board is supported
by three active Committees, and
in early 2023 the Board approved
the expansion of the remit of the
Nominations and Governance
Committee to include the important
area of sustainability oversight.
The Committee has been renamed
the Nominations, Governance and
Sustainability Committee.
During the year, we undertook a
shareholder engagement programme
to increase our understanding of the
views of our shareholders. The views
expressed have formed the basis of a
number of actions taken by the Board
in recent months across a range of
topics. In addition, we have begun an
independent external evaluation to
support the continued development
of the Board. We look forward to
identifying how best we, as a Board,
can continue to serve the interests
of our shareholders, employees,
partners and all our stakeholders.
As Chairman, I am committed
to ensuring that Uniphar Group
continues to align itself with the
highest standards of governance and
probity, as are my Board colleagues.
The Board is committed to
ensuring the highest standards
of corporate governance across
the Group.
Performance in 2022
Uniphar delivered a strong
performance in 2022, with an EBITDA
of €98.0m and Organic gross profit
growth of 5.7% demonstrating the
strength of the Group’s diverse
service offering. The performance
is set against the backdrop of
unprecedented global cost inflation
and supply chain disruption. As usual,
the Uniphar team responded quickly
and with ingenuity to these new
challenges, and the results for the
year were achieved, in no small
part, because of the dedication
and commitment of the Group’s
employees. On behalf of the Board,
I want to thank them for their focus,
teamwork and determination to
deliver for our clients.
The Group continued to execute
its strategic agenda over the past
year and progress was made with
expanding our global footprint
and service offering to clients.
We welcomed three new acquisitions
into the Uniphar Group in 2022 –
BModesto Group in the Netherlands,
Inspired Health in the USA and
Orspec Pharma in the Asia Pacific
region. Each of these acquisitions is
a strong cultural fit for the business
and brings a range of expertise
and insights that further enhance
the integrated solutions we offer to
our clients.
Corporate Governance
The Board is committed to ensuring
the highest governance standards
are in place across the Group.
In early 2022, the Board adopted
the UK Code (the compliance with
which is set out on page 72) as the
Group’s corporate governance
code, achieving another important
milestone on our journey as a publicly
quoted company.
9
10
UNIPHAR PLC ANNUAL REPORT 2022
People & Culture
An organisation’s culture has
a significant impact on how it
operates day-to-day and the
ultimate success it achieves.
The Board acknowledges
the importance of Uniphar’s
unique culture in its success
– commercially focused, results-
driven and innovative, placing the
patient at the centre of everything
we do. In a business focused
on growth, both organically and
through acquisition, the ability to
embed this culture and belief in
operating to the highest standards
is essential.
The underlying strength of our
culture has been demonstrated
through the growth the Group
has achieved in recent years. The
Board continues to further the
development and enhancement of
this culture, recognising that it is
driven by the Group’s leadership.
Sustainability
Uniphar recognises the
importance of being an industry
leader in operating in the
most sustainable and socially
responsible way possible
and places a high priority on
sustainability. We are sensitive to
our impact on the planet, on our
communities and on our people.
Continuous development across
our five pillars of sustainability is
a key goal for the Board and the
management team. Further detail
on our sustainability strategy and
execution can be found in our
Sustainability Report on pages
36 to 54.
During the year Uniphar launched
its Unity@Uniphar initiative,
an umbrella for inclusivity and for
uniting our workforce for common
purposes within our business
and the communities where we
operate. We have continued
to focus on Equity, Diversity &
Inclusion, with the creation of
two Employee Resource Groups
– the Rainbow Alliance and the
Women’s Alliance. Both groups
held events during the year for
alliance members and their allies.
The “One Uniphar”
event, led by the
Executive Leadership
Team, provided
an opportunity to
embed our culture
and vision and
promote networking,
collaboration and
sharing of best
practices across
the Group.
People & Culture
Read more on page 25
Sustainability &
Governance Report
Read more on page 36
11
Charity
Initiatives
Raised funds to alleviate the
humanitarian crisis in Ukraine
and to cancer charities
around the world.
€4.8m
Total dividend of €4.8m
for the year, representing
a 4.8% increase on 2021.
Under the Community pillar, as well
as facilitating and supporting many
initiatives with local communities
and charities, we ran two major
fund-raising initiatives, Unity
for Ukraine and Unity for Hope.
We worked with our customers
and suppliers to raise €880,000
in funds and medical supplies to
alleviate the continued humanitarian
crisis in Ukraine and €150,000 to
support cancer charities around
the world.
Our teams also made progress
under our Environmental pillar,
improving our carbon footprint
initiatives and focusing on ways to
further decarbonise our business.
We completed our first Scope
3 assessment, highlighting the
opportunity for a collaborative
approach with our suppliers to
reduce our collective impact on
the environment.
Dividend
The Board is recommending a
final dividend of €3.1m (€0.0113
per ordinary share), payable on
16 May 2023 to shareholders
registered on the record date of
21 April 2023. Together with the
interim dividend of €1.7m (€0.0061
per ordinary share), this brings the
total dividend for the year to €4.8m
(€0.0174 per ordinary share).
This dividend for the year represents
an increase of 4.8% on 2021
and demonstrates the Board’s
commitment to a progressive
dividend policy, as stated at the
time of IPO.
Looking Forward
The Board and I remain confident
that the business has built a strong
foundation from which the Group’s
business model and strategy will
continue to deliver long-term value for
our shareholders and stakeholders in
the coming years.
Uniphar will continue to drive
profitable growth and pursue
acquisition opportunities that
expand our footprint and the
diversity of services we offer,
creating enhanced shareholder
value as a result. The Group will
continue to adopt a disciplined
approach to capital deployment.
The business targeted at the time
of IPO to doubling EBITDA within
five years and that commitment
is on track to be achieved
notwithstanding the multiple
global headwinds experienced
in recent years. To date, we have
delivered on our commitments and
continue to build the platform for
growth. I believe the business is
very well positioned to continue
its growth trajectory. We have a
market leading management team
in place, supported by a skilled
and knowledgeable Board, a clear
strategy for moving forward and
the financial strength to execute
that strategy.
Maurice Pratt
Chairman
12
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
STRATEGIC REVIEW
Enabling
Healthcare
through
Connectivity
Chief Executive’s Report
Our Strategy
Our Business Model
Key Performance Indicators
People & Culture
Risk Management
Sustainability and Governance Report
15
19
21
23
25
27
36
13
14
UNIPHAR PLC ANNUAL REPORT 2022 CHIEF EXECUTIVE’S REPORT
Strong Performance
Enabling Future Growth
Gerard Rabbette
Chief Executive Officer
2022 has been another excellent
year for Uniphar, reflecting the
resilience and diversity of Uniphar’s
business model and our strong
market position.
OVERVIEW
STRATEGIC REVIEW
PERFORMANCE REVIEW
GOVERNANCE
FINANCIAL STATEMENTS
Performance Review
Read more on page 56
Financial Review
Read more on page 57
11.7%
Gross profit growth
€98.0m
EBITDA
18.4 (cent)
Adjusted EPS
2002 has been another excellent
year for Uniphar, reflecting the
resilience and diversity of Uniphar’s
business model, our strong market
position and our ability to proactively
respond to the global macroeconomic
challenges the world has faced in
the last twelve months.
Performance Highlights
Our business delivered a strong
performance in 2022 with Gross Profit
increasing by 11.7% from €274.5m to
€306.7m and EBITDA increasing by
13.4% from €86.5m to €98.0m. This
solid growth was achieved against
the backdrop of a challenging global
operating environment, which brought
increasing cost pressures, combined
with an uncertain economic backdrop.
The strong profitability is reflected in
a robust Return on Capital Employed
(ROCE) for the year of 17.3%.
Our cash and liquidity position
remains solid, finishing the year
with leverage of 1.0x and net bank
debt of €91.2m. We refinanced our
banking facility during the year, more
than doubled the revolving credit
facility to €400m, with an additional
uncommitted accordion facility of
€150m, demonstrating the strong
support of our banking partners.
Three new international banks joined
the banking syndicate, providing
us with the platform to accelerate
our ambitious growth strategy and
acquisition pipeline.
Operational Highlights
Each of our three divisions made
considerable progress towards their
strategic objectives in 2022, with
several firsts for Uniphar. We made
our first acquisition in the Asia Pacific
region when we acquired Orspec
Pharma and we completed our first
acquisition of significant scale in
mainland Europe with the acquisition
of BModesto Group.
Commercial & Clinical
Our Commercial & Clinical Division
delivered a strong performance
this year, particularly in the Medtech
business, reinforcing our role as
a trusted partner to our clients
and customers. Similarly, the
Pharma Services business continues
to support our customers in the
transition to digital and omni-
channel technology platforms in a
trend accelerated by the Covid-19
pandemic. Recent acquisitions
such as E4H and Inspired Health
further build out the range of
solutions we can offer clients in
the Pharma Services business.
With approximately 60% of the
Commercial & Clinical Division’s
revenues already earned outside
the Irish market, we continue to see
significant opportunities for both
Pharma and MedTech in
Europe and beyond.
Supply Chain & Retail
The Supply Chain & Retail Division
has again outperformed expectations,
despite the challenges presented by
energy and cost inflation during the
year. Uniphar remains a leading player
in the Irish market and our decision
to invest in a new distribution facility
in Ireland further highlights our
commitment to consolidating that
position. This new facility will be
built to the highest sustainability
standards and encompass the latest
technology. This will significantly
increase capacity and futureproof
the business for growth in the
years to come. The acquisition of
the McCauley Pharmacy Group
which was completed in early 2023,
following Competition and Consumer
Protection Commission (CCPC)
approval, further enhances our
position in the Irish retail pharmacy
market. The proposed acquisition of
Navi Group will no longer proceed to
completion as it has not been cleared
by the CCPC. Navi Group has been
a longstanding partner of Uniphar
and both parties will continue to
work closely together to support our
shared customer base of independent
community pharmacies.
Product Access
The Product Access Division delivered
a solid performance in the year and
continued to build its platform, with
two acquisitions in 2022. Gross profit
growth of 21.4% was achieved,
building on the exceptional growth
of 35.8% in the 2021 comparative
period. The Covid-19 pandemic has
disrupted and delayed the product
development and commercialisation
pipelines for new pharmaceutical
products and this has impacted
the division’s 2022 organic growth.
However, we are targeting a return
to double digit organic gross profit
growth in the second half of 2023.
The recent acquisitions in this division
of BModesto Group and Orspec
15
16
UNIPHAR PLC ANNUAL REPORT 2022
Pharma will enhance our capabilities
and, coupled with a solid business
development pipeline, position
the Product Access Division well
to capitalise on opportunities in
the market.
Capital Allocation
We continued our disciplined
approach to capital allocation during
2022. Return on Capital Employed
for the year is a strong 17.3%, ahead
of our target rate range of 12% –
15%. The second half of 2022 has
been active from an acquisitions
perspective as we continue to invest
in our three divisions.
We made our first acquisition in Asia
Pacific in August 2022, with the
purchase of Orspec Pharma,
an Australian distributor of speciality
pharmaceuticals with a footprint
across the Asia Pacific region.
Product Access is a global business,
so our first acquisition in the southern
hemisphere expands, in a significant
way, our capacity to provide a
truly worldwide service to our
global clients.
Inspired Health, acquired in
September 2022, is a US-based
healthcare insights and intelligence
consultancy business that uses
innovative market research
techniques to assist its clients
to better understand their target
physicians, patients, administrators
and payers. The acquisition
expands Uniphar’s presence in the
strategically important US market
and complements and strengthens
our existing US portfolio.
BModesto Group, acquired in
November 2022, is a European
focused speciality distributor of
medicines, headquartered in the
Netherlands. This acquisition
provides a large, efficient mainland
Europe distribution hub that will
support further European growth,
most particularly in the Product
Access Division.
17
The McCauley Pharmacy Group
acquisition completed in early
2023 adds 37 retail pharmacies
to the Group’s existing network of
owned and symbol group stores.
McCauley’s is widely recognised as
a leading provider of pharmacy and
retail services in Ireland and a market
leader in the delivery of health,
wellbeing and beauty products.
Our first acquisition
in the southern
hemisphere expands
in a significant way
our capacity to
provide a
truly worldwide
service to our
global clients.
Our Strategy
Read more on page 19
Performance Review
Read more on page 56
We completed four acquisitions in
2021: CoRRect Medical, Best MSLs,
E4H and Devonshire. These are
all now integrated into the Group.
With these businesses already adding
value and delivering synergies,
we remain excited about the potential
they will achieve as part of the
wider Group.
Our acquisition approach is to partner
with innovative companies that have
talented teams who are culturally
aligned to the Group and whose
value-add services complement and
broaden our existing capabilities.
Our investments are each expected to
deliver a Return on Capital Employed
in line with the Group’s target rate
of 12%-15% within three years,
with consideration consisting of an
upfront payment plus contingent
consideration payable on the
achievement of specified objectives.
Technology as an Enabler
of Future Growth
We firmly believe that technology
is an enabler of future growth and
investment in technology is essential
to the long-term success of the
Group. We continued to invest in our
digital platforms, infrastructure and
strategic initiatives to drive organic
growth during 2022. Our multi-year
investment in a new distribution
centre in Ireland will encompass
the latest technology and enable
us to drive operational efficiencies.
OVERVIEW
STRATEGIC REVIEW
PERFORMANCE REVIEW
GOVERNANCE
FINANCIAL STATEMENTS
It presents the opportunity to
futureproof our Supply Chain &
Retail business by doubling existing
capacity levels. As the business
expands, we recognise that
technology investment is essential
to support the enlarged Group
and we have commenced a multi-
year technology transformation
programme. The initial focus is on our
ERP platforms to ensure that we are
using the latest technology to enable
us to scale the business further.
United by a Common Purpose –
Putting the Patient First
Innovation and change are constants
in our industry and we continue to be
innovative in the solutions we bring to
our clients. In Commercial & Clinical,
we offer value-added solutions in
areas such as data analytics and
targeted digital marketing in Pharma,
in addition to robotic surgical
solutions in MedTech. In Product
Access, science is delivering more
innovative treatments that are
increasingly complex. They require
more sophisticated regulatory and
distribution processes and Uniphar
has the expertise to provide these.
In Supply Chain & Retail, pharmacists
are spending more time engaging with
patients and are seeking solutions
to simplify their administration
processes. Uniphar’s Pharmacy of the
Future solution enables pharmacists
to focus their time on their patients,
where they are most effective.
The common vision across all our
divisions is our desire to improve
patient access to pharmaco-medical
products and therapies. We do this
by always focusing on patients and
putting them at the centre of our
business. We invest capital and
resources strategically to ensure
that our product and service offering
is at the forefront of the industry
and that our customers think of
us as partners in addressing their
challenges. Investments in recent
years in businesses that specialise in
consultancy services, data analytics
and targeted marketing demonstrate
our dedication to providing the range
of specialist skills required by our
clients to take full advantage of the
opportunities available to improve
access for patients to the medicines
they need.
Integrating Sustainable
Practices Into What We Do
Sustainability is at the core of what
we do and is deeply embedded in
our business strategy. We want to
contribute positively to the people
and the world around us. Running our
business in a sustainable way ensures
that Uniphar will continue to prosper
in the long-term.
We are focused on ensuring that each
of the five pillars of our sustainability
strategy are a fundamental part of
our decision-making process and
I am pleased with the progress we
made in 2022. From an environmental
perspective, we are continually
reviewing how we can operate
more sustainably. Our capital
investment in a new state-of-the-art
distribution centre for our Supply
Chain & Retail business will be
constructed to the gold standard
on the LEED (‘Leadership in Energy
and Environmental Design’) rating
system for sustainable construction.
We achieved a ‘B’ score in our CDP
2022 submission. This represented
meaningful progress on our prior
year score of ‘C’. Our People pillar
is equally important to us. Among
the initiatives we launched in 2022
were two employee resource groups
to support our female and LGBTQi+
colleagues.
We continue to focus on supporting
the communities we operate in.
In partnership with our suppliers and
customers, we sourced essential
medical equipment and supplies of
€880,000 for humanitarian efforts in
Ukraine, through our Unity for Ukraine
initiative. For the third consecutive
year, we also ran our Unity for
Hope initiative to raise funds for
cancer charities around the world.
This initiative raised much needed
funds of €150,000 and brings the total
raised to more than €750,000 since
we started the programme three
years ago.
Our Strategy Continues To Deliver –
Our People Make The Difference
At our core, we are a people
business. This is reflected in the
relationships we build and the
patients who rely on us. None of our
achievements would be possible
without the talent and dedication
of our people who share the same
purpose – to get medicines to the
patients who need them. It is this
purpose that makes our people go
the extra mile in the knowledge that
it really does matter that healthcare
professionals have access to the
medicines they need to give their
patients the best possible care. I am
very proud of the entire Uniphar team
who delivered our strong performance
in 2022 and made continued
progress towards our strategic
objectives. On behalf of the Executive
Leadership Team, I would like to
thank all my excellent colleagues in
Uniphar for their ongoing hard work
and commitment.
Looking Forward
The Uniphar business model and
strategy have proven to be resilient
over the past few years and the
business is on track to achieve
its objective of doubling EBITDA
within five years of IPO. Each of our
divisions has built a strong platform
from which to grow and address
our target markets. Our industry
continues to change and be shaped
by technology and new scientific
discovery. We are confident we have
the right strategy, the best people and
the market opportunity to continue to
grow and deliver for our stakeholders.
Our strong Balance Sheet enables
us to adopt a long-term mindset
and deploy capital in areas that offer
attractive returns by further enhancing
the capabilities of our integrated
business model.
Gerard Rabbette
Chief Executive Officer
18
UNIPHAR PLC ANNUAL REPORT 2022 OUR STRATEGY
Expanding our Reach
to Deliver Growth
Our vision is focused on improving patient access
to pharmaco-medical products and therapies.
We do this by enhancing connectivity between manufacturers
and healthcare stakeholders. Delivering our strategy in a
sustainable way is a key business objective of the Group.
STRATEGIC PILLARS
STRATEGY IN ACTION
OUTLOOK
COMMERCIAL & CLINICAL
Enabling patient access
to treatments in MedTech
and Pharma industries
PRODUCT ACCESS
Enabling equitable access
to unlicensed medicines
worldwide
SUPPLY CHAIN & RETAIL
Enabling the supply of
medicines in Ireland
Building an integrated European and
targeted US offering to MedTech and
Pharma clients
Delivering a pan-European platform
Providing sales, marketing and distribution
solutions to manufacturers
Focusing on speciality pharma
and medical technologies
Becoming a global leader in
unlicensed medicines and Expanded Access
Programmes (EAPs)
Sourcing and supplying unlicensed medicines
Managing EAPs for global manufacturers
Serving clients in 160+ countries
Growing our market leadership position
Achieving the Number One position in wholesale
in Ireland
Becoming a key player in the retail and pharmacy
supply chain
Supporting a network of 386 owned and franchised
pharmacies (excluding McCauley’s Pharmacy Group)
Acquiring Inspired Health and expanding our
capabilities to offer healthcare insights and
intelligence consultancy
Driving divisional growth through the strength of our
service offering and the integration of prior acquisitions
in building-out an integrated market offering to clients
Continued service innovation in data analysis,
commercialisation consultancy and
omni-channel delivery
+ Read more on our Commercial & Clinical Division on page 61
Awarded several US EAPs, demonstrating our
capability to deliver global programmes
Acquiring BModesto and expanding our delivery of
services into more European markets
Acquiring Orspec and expanding our footprint into key
Asia Pacific markets
+ Read more on our Product Access Division on page 63
Acquiring the McCauley Group and expanding our
retail pharmacy footprint in Ireland
Investing in a new Irish distribution facility, to provide
the infrastructure to double current capacity levels
+ Read more on our Supply Chain & Retail Division on page 65
Uniphar has positioned itself as
a leading player in the industry,
capable of supporting manufacturers
throughout the product lifecycle.
The inherent strength of our business
is in our integrated offering that
provides the platform for the next
stage of growth.
Innovation is increasingly specialised
and originating from a broad range
of biotech and MedTech companies
focused on niche therapeutic areas.
These advanced therapies are often
personalised products for patients
and dependent on complex R&D and
distribution processes. Manufacturers
are seeking partners who can help
them commercialise their assets,
educate their target market on their
product and ultimately enable them
to get the therapies to the patients
who need them.
Uniphar continues to focus on
attracting and developing future
leaders of the business so that we
can deliver our strategic objectives.
Capital allocation remains a core
focus and we maintain a disciplined
approach with the flexibility to
pursue acquisition and strategic
investment opportunities.
19
20
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
OUR BUSINESS MODEL
Creating
Sustainable
Value
OUR VISION
Improving patient access
to pharmaco-medical
products and therapies
WHAT WE DO
Enhance connectivity
between manufacturers
and healthcare
stakeholders
OUR RESOURCES
HOW WE ADD VALUE
People
We rely on skilled and engaged
employees to deliver our
products and services. Our
experienced teams, many
of whom are clinically trained,
have deep industry and sectoral
knowledge that our customers
depend on.
Relationships
We work with the worlds leading
healthcare companies, as a
trusted partner, supporting
them across the lifecycle of
their products. We maintain
long term sustainable
relationships, providing value
added services through all
stages of product development
and commercialisation.
Financial
We maintain a strong financial
position that enables us to
pursue organic investment
opportunities, supported by
M&A, to continue our growth
and development.
Infrastructure
We have a diverse geographic
footprint, with a presence in
major healthcare markets. Our
global presence and knowledge
of local regulatory requirements
enables us to deliver product to
the patients who need it.
Digital
Healthcare is being transformed
by digital innovation across all
areas of pharma and MedTech.
We have developed capabilities
in data analytics, product
development consultancy and
digital marketing to support
our customers.
Understanding
customer needs
We partner with our customers
to solve their biggest challenges.
Many of our teams are clinically
trained and engage with our
clients on a peer-to-peer level
and become trusted advisors
to them.
Our unique
integrated model
We offer our customers an
integrated model that supports
them throughout the lifecycle of
their products from early-stage
development through to product
maturity. We draw on capabilities
across our Group to provide an
integrated solution.
Sustainable
financial model
We are disciplined in our
capital allocation and
maintain flexibility to invest
in opportunities that create
shareholder value. Our effective
risk management processes are
core to optimising our returns.
Operational excellence
We are relied on by our
customers and patients to
provide them with the therapies
and solutions they need daily.
We drive the highest standards
of operational excellence to
ensure we achieve this.
Digital first
We utilise a range of digital
capabilities helping our clients
to focus their efforts on their
most rewarding opportunities
and providing insights to
them that support their
commercialisation objectives.
Always growing
We set ambitious growth targets
and deliver them through
a combination of organic
growth and selective capital
deployment in acquisitions.
THE VALUE WE CREATE
EBITDA
We have grown EBITDA
each year since IPO
and remain on-track to
achieve our objective of
doubling EBIDTA within
five years of IPO.
EBITDA 2022 €98.0m
ROCE
We target a Return on
Capital Employed (ROCE)
of 12%-15% within
three years of capital
investment.
Free Cash Flow
We focus on cash
generation and target an
Adjusted Free Cash Flow
conversion of 60%-70%.
Dividends
We have a progressive
dividend policy that
seeks to return capital to
shareholders each year.
Return on Capital
Employed 2022 17.3%
Free Cash Flow
Conversion 2022 82.5%
Dividends for 2022 €4.8m
People
We invest in our people and develop
them to take on future leadership
roles in the organisation. We create
a rewarding place to work, focused
on performance and personal
development which embraces
diversity and inclusion.
Sustainability
We focus on operating our
business in a sustainable way.
We continue to make progress
with carbon emissions reporting
and improved our CDP score to
‘B’ in 2022. (2021: ‘C’ score).
Community
In partnership with our suppliers
and customers, we sourced
essential medical equipment and
supplies for humanitarian efforts in
Ukraine in 2022. This was also the
third consecutive year of our Unity
for Hope initiative supporting
cancer charities across the world.
21
22
22
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS KEY PERFORMANCE INDICATORS
350
Measuring Success
300
250
200
Gross Profit
FINANCIAL
KEY PERFORMANCE INDICATORS
Gross Profit
€306.7m
Gross Profit
EBITDA
150
100
50
0
2020
WHY WE MEASURE IT?
2021
2022
350
300
250
150
200
Gross profit is viewed by the
Board as the best measure of
top-line performance. It allows
management to assess the
performance of the business
and is a key measure in the
assessment of divisional
2020
performance.
2022
2021
100
100
80
50
0
60
40
2020
2020
2020
2020
2020
2021 2022
2021 2022
2021 2022
2021 2022
2021 2022
20
0
2020
2021
2022
2020
2021 2022
EBITDA
Free Cash
Flow
60
80
100
120
40
EBITDA provides management
with an assessment of the
underlying trading performance
of the Group and excludes
transactions that are non-
Access
recurring, allowing for
Access
Access
Access
comparison of the trading
Access
Prog
Prog
Prog
performance of the business
Prog
2022
Prog
across periods and/or with
other businesses.
2021
2020
0
60
100
20
80
40
20
Our EBITDA increased by 13.4%
to €98.0m in 2022. The result
reflects the strength of the business
model, the quality of our business
and our expanding geographic
and product diversity.
2020
The Group remains confident of
delivering the target of doubling
pro-forma EBITDA within five years
of IPO.
2021 2022
80
80
80
80
70
70
70
80
70
60
60
60
70
60
50
50
50
60
50
40
40
40
50
40
30
30
30
40
30
20
20
20
30
20
10
10
10
20
10
0
0
0
10
0
2020
2020
2020
2020
2020
2021 2022
2021 2022
2021 2022
2021 2022
2021 2022
0
350
300
2020
2021
2022
0
2020
Gross Profit
Gross Profit
Gross Profit
Gross Profit
Gross Profit
EBITDA
EBITDA
EBITDA
EBITDA
EBITDA
Free Cash
Free Cash
Free Cash
Free Cash
Free Cash
Flow
Flow
Flow
Flow
Flow
ROCE
ROCE
ROCE
ROCE
ROCE
Adjusted
Adjusted
Adjusted
Adjusted
Adjusted
Earnings
Earnings
Earnings
Earnings
Earnings
350
350
350
350
300
300
350
300
300
250
250
300
250
250
200
200
250
200
200
150
150
200
150
150
100
100
150
100
100
50
50
100
50
50
0
0
50
0
0
0
100
100
100
100
80
100
80
80
80
60
80
60
60
60
40
60
40
40
40
20
40
20
20
20
0
20
0
0
0
0
120
120
120
120
100
100
120
100
100
80
80
100
80
80
60
60
80
60
60
40
40
60
40
40
20
20
40
20
20
0
0
20
0
0
0
20
20
20
20
20
15
15
15
15
15
10
10
10
10
10
5
5
5
5
5
0
0
0
0
0
20
20
20
20
20
15
15
15
15
15
10
10
10
10
10
5
5
5
5
5
0
0
0
0
0
2022: €306.7m
2021: €274.5m
2020: €217.3m
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
EBITDA*
€98.0m
2022: €98.0m
2021: €86.5m
2020: €66.7m
2022
2022
2022
2022
2022
2021
2021
2021
2021
2021
2020
2020
2020
2020
2020
Free Cash Flow
Conversion*
82.5%
2022: 82.5%
2021: 76.6%
2020: 111.0%
2022
2022
2022
2022
2022
2021
2021
2021
2021
2021
2020
2020
2020
2020
2020
Return on Capital
Employed*
17.3%
2022: 17.3%
2021: 17.6%
2021
2021
2020: 18.7%
2021
2021
2021
2022
2022
2022
2022
2022
2020
2020
2020
2020
2020
Adjusted Earnings
per Share (cent)*
18.4c
Gross Profit
Free Cash
Flow
ROCE
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
EBITDA
ROCE
Adjusted
Earnings
2020
2020
2020
2020
2020
2021 2022
2021 2022
2021 2022
2021 2022
2021 2022
Free Cash
Adjusted
Flow
Earnings
250
40
0
15
80
100
100
150
20
60
50
120
200
Free cash flow conversion
represents the funds generated
from the Group’s ongoing
operations. These funds are
available for reinvestment
and for future acquisitions,
Healthcare
Healthcare
Healthcare
Healthcare
2022
as part of the Group’s growth
Healthcare
Interactions
Interactions
strategy. We use free cash flow
Interactions
Interactions
2022
Interactions
to assess and understand the
total operating performance of
the business.
2020
2020
2020
2021
2021
2021
2022
10
0
20
5
0
100
15
60
40
20
10
20
80
Return on Capital Employed
(ROCE) is the key benchmark
the Group uses to evaluate
the performance of existing
businesses and potential
Symbol
Symbol
Symbol
Symbol
investment opportunities.
Symbol
Group
Group
2022
Group
Group
2022
Group
2020
2020
2021
2021
20
15
5
10
0
0
5
0
2020
2021
2022
120
20
40
100
5
20
15
80
60
10
Adjusted EPS is used to
assess the after-tax underlying
performance of the business,
in combination with the impact
of capital structure actions on
the share base. This is a key
measure used by management
to evaluate the operating
performance of the business,
generate future operating plans
and make strategic decisions.
2021
2021
2022
2022
2020
2020
0
0
20
15
2020
2021 2022
PERFORMANCE
Gross Profit has increased by
11.7% driven by strong organic
gross profit growth of 5.7%, in
conjunction with the impact
of acquisitions in both 2021
and 2022.
2020
Despite a challenging macro
2021 2022
environment, the Group expects
another strong year of profit
growth in 2023.
Access
Prog
Access
Prog
Healthcare
Interactions
Access
Symbol
Prog
Group
Healthcare
Interactions
Symbol
Group
2020
2020
2020
2020
2021
2020
2021
2021
2021
2021
2022
2021
2022
2022
2022
2022
2022
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
A free cash flow conversion
of 82.5%, reflects a strong
performance, together with tight
working capital management
and growth delivered from cash
reinvestment.
800
1000
800
800
800
1000
1000
1000
1000
2020
600
800
600
600
600
2021 2022
Cash generation and working
capital management remain a key
2022
focus of the Group in 2023.
2021
2020
400
600
400
400
400
200
400
200
200
200
Healthcare
Interactions
Symbol
Group
0
200
0
0
0
2020
0
2020
2020
2021 2022
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
2020
0
2020
2020
2021
2020
2020
2020
2021
2021
2022
2021
2021
2021
2022
2022
2022
2022
2022
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
2022
2022
2022
2022
2022
The Group continues to generate
strong returns on capital employed,
despite its continued growth and
investment.
Strong returns on capital will
continue to be a key focus in future
2020
capital allocation decisions by
2020
the Group.
2021 2022
2021 2022
400
400
400
400
350
350
350
400
350
300
300
300
350
300
250
250
250
300
250
200
200
200
250
200
150
150
150
200
150
100
100
100
150
100
50
50
50
100
50
0
0
0
50
0
Adjusted EPS grew by 13.2%
during 2022 – from 16.2c (2021)
to 18.4c (2022). It was driven by
a 14.4% increase in Profit after
Tax excluding exceptional items.
It was offset by a small increase
in the weighted average number
2022
of shares, as a result of the timing
2022
impact of LTIP shares which met
the performance conditions in 2022.
As noted above, the Group expects
growth to continue in future periods.
2021
2021
2020
2020
The Group has a number of Key Performance Indicators (‘KPIs’)
that monitor progress against the achievement of our strategy.
Each division has its own KPI measures which are aligned
with the Group’s measures.
NON-FINANCIAL
KEY PERFORMANCE INDICATORS
WHY WE MEASURE IT?
PERFORMANCE
2020
Number of Expanded
Access Programmes
75
2020
2022
2021
2021
2022
2022: 75
2021: 65
2020: 61
2021
2020
2022
2020
2021
2022
2020
2021
Symbol Group
2020
2022
Pharmacy Numbers
386
2021
2022
2020
2020
2022
2021
2022: 386
2021: 378
2020: 346
2021
2022
2020
2021
2022
2020
2020
2021
2021
2022
2022
A key strategic priority of Product
Access is the successful operation
of Expanded Access Programs
(EAPs), facilitating the supply of
specialised medicines to patients
who require them. Continued growth
in the number of these programmes
is a key metric in measuring progress
against this priority, as well as
the strength of our manufacturer
relationships.
The Uniphar Symbol Group consists
of owned and franchised pharmacies
operating under our Allcare, Life
and Hickey’s pharmacy brands, as
well as wholesale customers who
we support through our range of
innovative retail support services.
The number of pharmacies operating
under the Symbol Group provides
management with insight into the
strength of these brands and our
service offering in the marketplace.
Healthcare Professional
Interactions
825k+
2020
2020
2020
2021
2021
2021
2020
2020
2021
2021
2022
2022
The number of interactions with
healthcare professionals is a key
metric of the Commercial & Clinical
Division, as it measures the strength
of our relationships and enables
us to deliver solutions for our
manufacturers.
2022
2022
2022
2022: 825k+
2021: 800k+
2020: 600k+
2022
2021
2020
2020
2021
2022
During 2022, the number of
Expanded Access Programs
(EAPs) in progress or completed
by the Group grew to 75. Recent
acquisitions in the Product
Access Division have increased
the capabilities of the Group to
offer global EAP solutions to
manufacturers.
The growth in pharmacy numbers
demonstrates the strength of our
market offering and the key role
we play in the national health
infrastructure. We support our
pharmacies through our best-in-
class supply chain e-commerce
platform providing a tailored
solution for each group member.
The Group grew the number
of interactions by 3% in the
year, against the backdrop of a
changing environment.
The Covid-19 pandemic has
changed how healthcare
professionals are engaged with
and there is a move towards a
digital-first engagement model.
The Group has made strategic
investments in digital engagement
technologies and resources that
enable the business to succeed in
this dynamic environment.
24
80
70
60
50
40
30
20
10
0
80
70
60
50
40
1000
30
800
20
10
600
0
400
200
0
1000
800
600
400
350
400
300
200
250
200
0
150
100
50
0
80
70
400
60
350
50
300
40
250
30
200
20
150
10
100
0
50
0
1000
800
600
400
200
0
400
350
300
250
200
150
100
50
0
2022: 18.4c
2021
2021: 16.2c
2021
2021
2021
2020: 12.6c
2021
2020
2020
2020
2020
2020
2022
2022
2022
2022
2022
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
* This is an Alternative Performance Measure (APM) not defined under IFRS. Details on how this is calculated is included in the APM
ROCE
23
section on pages 207 to 211.
10
5
0
20
15
10
5
0
Adjusted
Earnings
2020
2021
2022
2020
2021
2022
2020
2021
2022
2020
2021 2022
2020
2021
2022
2020
2020
2021
2021
2022
2022
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS PEOPLE & CULTURE
Our People -
Our Greatest Resource
Hybrid Working Supporting
Work Life Balance
One of the outcomes of our Future of
Work project was the development of
guidelines to support our businesses
in offering a hybrid working solution
to any employee whose position
allowed it. Our recently renovated
headquarters building, completed in
April 2022, was remodelled to create
a variety of flexible, open spaces for
collaboration, problem-solving and
focused work. The open plan desk
seating, combined with the visually
appealing interior design and the
range of workspaces, makes for an
exciting place to work for employees.
One Uniphar – Being More than
the Sum of our Parts
In 2022, we spent time examining
our culture, looked at what makes
Uniphar stand out from other
companies and how this can help
us to attract and retain great talent
across our three divisions. As we
see it, we are building a culture
based on five core principles that
we all share. When we seek out
acquisitions, finding a good cultural fit
is important to us. As we acquire new
companies, our capabilities increase,
our resources improve and our ability
to serve more customers in more
markets grows, but our culture is not
diluted. Every team and business we
acquire or grow will need to share
our common purpose – to improve
access to medicines for patients.
The five core principles that underpin
our culture are set out on page 6
of this report.
Developing our Greatest Resource
People & Culture is one of the five
pillars of our Sustainability Strategy
and our business is built on the talent,
ingenuity and commitment of our
people. We truly believe that people
are our greatest resource and we
continue to invest in growing and
developing our colleagues.
Encouraging Diversity and Inclusion
Our clients engage with a team of
great people who can offer them the
support, advice, expert knowledge
and services that they need. It’s not
just our diversification as a business
that gives us the ability to meet client
needs but also our diversity as a
team. Uniphar’s role as an employer
is to make sure that every colleague
feels comfortable, accepted and
able to fulfil their professional
potential, while bringing their true
self to the workplace. To this end,
we launched our first two Employee
Resource Groups (ERGs) in 2022
– our Women’s Alliance to provide
support for women in the workplace
and the Rainbow Alliance to support
and provide allyship for LGBTQi+
colleagues.
Both Alliances fill the important role
of reminding us to consider the needs
of all our colleagues, not just those
in the majority, when we look at
business decisions.
We truly believe
that people are our
greatest resource
and we continue to
invest in growing
and developing
our colleagues.
25
Improving Transparency and
Access to HR Information
A major initiative this year has been
the development and roll out of
a global HR information system.
With the first phase completed,
every colleague has access to key
employment and HR information in
an easy-to-use portal. Future phases
that will expand and enhance the
services the system can provide
and further improve the employee
experience are being planned.
Wellbeing
As an employer, Uniphar Group
works to support employee
wellbeing. We understand the links
between work, health and wellbeing,
and the role that every employee
can play in adopting a joined-up
approach to wellbeing in their team.
We provide ongoing support for
employees through our Employee
Assistance Programme. This allows
all employees to avail of support from
a qualified counsellor on the phone
on a confidential basis, to help them
to manage stress, the loss of a loved
one, financial issues etc. In addition
to these structural supports, we also
arranged a number of wellbeing
events throughout the year to
increase awareness among our staff
of ways in which they can manage
and improve their own wellbeing.
Community Involvement
Uniphar colleagues have always been
very active in their local communities
and this work continues across the
business. We have created Unity@
Uniphar to act as an umbrella
for community and charitable
activities that Uniphar colleagues
get involved in, across all divisions
and geographies. This year, we
worked together on two major
initiatives – Unity for Ukraine and
Unity for Hope. Unity for Ukraine
raised funds, medical equipment
and other healthcare supplies to
send to Ukraine, to help alleviate the
humanitarian crisis caused by the
war that began in 2022. Colleagues
from across the business worked
with suppliers, manufacturers and
customers to provide medicines,
personal protective equipment (PPE)
and medical devices to the value of
approximately €880k.
Our second major initiative was Unity
for Hope (formerly called Relay for
Hope). This is now in its third year
of raising money for cancer charities
around the world. This is an activity-
based challenge that encourages
teams to raise their stepcounts and
this year we collectively covered more
than one million steps with colleagues
around the world organising
everything from walks on Australian
beaches, to sea swims, to walking
tours of Washington DC. A total of
€150k was raised for our chosen
cancer causes around the world.
Looking Forward
We are developing our divisional
human resources teams, to ensure
that we have the right people in the
right place, to support the differing
needs of colleagues and teams
across our business. Training,
learning and talent development are
our focus for 2023, as we look to
build a strong learning environment
to support our ambitious growth
plans and to offer our colleagues the
opportunity to develop and grow their
skills for their own benefit and for the
benefit of all Uniphar stakeholders.
Sustainability &
Governance Report
Read more on page 36
26
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS RISK MANAGEMENT
Managing Risk to Maximise
Sustainable Value
The Group’s Risk Management Policy provides
the framework to identify, assess, monitor and
manage the risks associated with the Group’s
business. It is designed to enable the Group to
meet its business objectives by appropriately
managing, rather than eliminating, these risks.
Audit, Risk and
Compliance
Committee Report
Read more on page 81
Board of Directors
Read more on page 69
Key Principal Risks
and Uncertainties
Read more on page 30
Risk Register Process
Read more on page 29
Risk Management and
Internal Control
The Directors have overall
responsibility for the Group’s system
of internal control and for reviewing its
effectiveness. Through the activities
of the Audit, Risk and Compliance
Committee, the effectiveness of these
internal controls is regularly reviewed.
The Group operates a Group-wide
Risk Register. This is reviewed
and updated on a regular basis
and presented to the Audit,
Risk and Compliance Committee.
The Committee considers the risks
identified and the effectiveness of the
mitigating actions taken, focusing on
those deemed most critical.
The Group has a dedicated Head
of Internal Audit who meets with
the Audit, Risk and Compliance
Committee to monitor the adequacy
of the Group’s internal control
systems. The Audit, Risk and
Compliance Committee also meets
with and receives reports from the
external auditors. The Chairman
of the Audit, Risk and Compliance
Committee reports to the Board on
all significant issues considered by
the Committee.
Where necessary, the Board draws on
the expertise of appropriate external
consultants to assist in dealing with
or mitigating risk.
Risk Management Framework
The Group’s Risk Management
Framework provides the structure
for managing the principal risks.
The Group has implemented a
‘three lines of defence’ approach
to ensure that risks are effectively
managed across the Group. Each
of these three ‘lines’ plays a distinct
role within the Group’s wider
governance framework.
Risk Management Policy Standards and Guidelines
Principal Risks
Board/Audit, Risk and Compliance Committee
1st line of defence
2nd line of defence
3rd line of defence
Operational Level
Processes and Controls in
the ordinary operations of the
business which identify, assess
and reduce or mitigate risk
exposure through management
or internal control measures.
Risk Co-Ordinator
Responsible for overseeing
and executing the Group’s
risk management process and
maintaining the Group’s Risk
Management Policy and Risk
Appetite Statement.
Internal Audit
Ensures independent oversight of the Risk
Management Policy and the execution of
the Group’s risk management process.
The Internal Auditor is responsible for testing
the design and effectiveness of the Group’s
control environment and ensuring the risk
management responsibilities of the 1st and
2nd lines of defence have been discharged.
g
n
i
t
n
e
m
e
p
m
l
I
M o nito r
Audit and
Investigation
Governance
Internal
Controls
Risk
Management
Process
Communication
& Training
Policies
Risk
Matrix
M
i
ti
g
a
tio
n
I
d
e
n
t
i
f
y
Risk
Register
Risk
Appetite
Statement
A s s ess
M
o
n
i
t
o
r
i
n
g
Board/Audit, Risk and Compliance Committee
Senior Management
Board
Ensure prudent risk
management is implemented
in the Group. Review and
approve the Group Risk
Register along with
Risk Appetite and Risk
Management Policy.
Audit, Risk and
Compliance Committee
Oversee the adequacy
and effectiveness of the
Group’s internal controls.
Responsible for the review
and assessment of the
effectiveness of the Group’s
risk management process.
Overall responsibility for establishing and embedding the
risk management processes within the Group. The Group
Risk Manager is responsible for monitoring, maintaining,
and presenting the Group Risk Register to the Audit,
Risk and Compliance Committee and the Board.
27
28
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Risk Register Process
The Group’s Risk Register process
is based on a Group-wide approach.
Risks are identified, assessed and
monitored with a clear focus on the
assignment of responsibility to each
risk owner.
2022 Highlights
The Group continues to ensure that
the Risk Management Framework is
integrated in the day-to-day activities
of the business. During the year
ended 31 December 2022, the Group
carried out the following:
» Reviewed the Group Risk Register,
updating for all the key risks facing
the Group at this time
» Performed a review of emerging
and new risks, including the risk
associated with Transformational
Project Execution
» Expanded some existing risks
to include new factors such
as climate change. Details of
specific climate related risks
and opportunities identified by
the Group are set out in the
Environment and Sustainability
Section of this Report on
page 49
» Continued to focus on
Cybercrime related risks
Emerging Risks
In addition to considering our current
principal risks, emerging risks are
also considered as part of our
overall risk management processes.
Management identifies, assesses,
and manages new and emerging
risks in the same way as the Group’s
principal risks. Emerging risks can
arise in two ways for the Group.
The risk can be newly identified as
part of the ongoing risk management
process in existence across the
Group; or the risk may already be
identified on the Group Risk Register,
but its potential impact may have
changed pointing to the need for a
reassessment.
Individual risks are assessed and
assigned a rating based on the
likelihood of occurrence and the
potential impact. The Risk Register
is reviewed regularly, and any new or
emerging risks are added as they are
identified and assessed.
Divisional management are
responsible for completing and
maintaining divisional risk registers,
setting out the risks and mitigating
factors pertaining to their area.
The Group Risk Manager reviews
these and updates the Group
risk register as required for any
significant risks arising. The Group
Risk Manager reports to the Audit,
Risk and Compliance Committee
and the Board on risk during the year.
The Audit, Risk and Compliance
Committee and the Board carry out a
robust review of the Risk Register and
communicate any required changes in
mitigating actions back to executive
and divisional management levels.
29
Principal Financial and Reporting
Risks and Uncertainties
The following tables set out the
principal risks and uncertainties,
which have the potential to have a
direct impact on the key strategic
objectives of the Group. The
principal risks are categorised as
Strategic, Operational and Financial.
These have been developed from a
full review of the Group Risk Register,
the business performance and
evolving global trends.
The risks are not listed in order of
priority, nor do they represent an
exhaustive list of all risks currently
affecting the business. They represent
what the Board deems to be the
principal risks and uncertainties
facing the Group at this time.
Some risks may not be currently
known to the Board or they may not
be of material consequence, at this
time. The mitigating factors that are
in place do not represent an absolute
level of protection and elimination
against the risk, but they are designed
to give reasonable protection against
the impact of the risk.
Key Principal Risks and Uncertainties
The principal risks and uncertainties for the year ended 31 December 2022 are summarised below.
Strategic Initiative
Link to strategic initiatives key
Trend Indicators
Strategic initiatives key to trending
Continued Client Growth
Stable
Focused Market Leadership
Increasing
Scaling Through Digital
Decreasing
↕
↗
↗
STRATEGIC RISKS
RISK
IMPACT
MITIGATION
Economic &
geopolitical
risk
Acquisitions
The global macroeconomic,
regulatory, political, and legal
environment may impact the markets
in which we operate and in turn our
client and supplier base.
The ongoing war in Ukraine
combined with rising interest rates,
unprecedented cost inflation and
supply chain challenges present an
increased risk for the Group. This may
adversely affect the Group’s financial
and operational results.
Growth through acquisition
continues to remain a key strategy
for the Group. Failure to identify,
complete and integrate acquisitions
successfully may directly impact the
Group’s projected growth.
Key personnel
& succession
planning
The success of the Group is directly
correlated to the effectiveness
and talent of its people, including
Directors, senior management,
and colleagues across all divisions.
If the Group fails to attract, retain,
and develop the skills and expertise
of colleagues, this may adversely
impact the Group’s performance.
The Group closely monitors global political and
economic conditions and responds quickly to any
changes in circumstances or events.
The Group has increased its geographical footprint
which now includes Ireland, the UK, the US, Europe
and Asia Pacific, thus decreasing the reliance on any
particular geographic market.
The Group actively manages its cost base to ensure
that margins are maintained and to reduce margin
erosion. Supply chain challenges are managed by
working closely with suppliers, managing stock levels
and advance purchasing, where possible.
All potential acquisitions are assessed to measure
their strategic fit and financial return. Specialist
advisers are appointed to provide robust and
thorough due diligence.
Experienced management and project teams
ensure integration is managed effectively, to achieve
identified benefits and minimise potential risks.
The Group carries out a Goodwill Impairment
assessment annually, or more frequently, if required,
to ensure the carrying value remains appropriate.
Succession planning and talent management is
implemented across the Group, ensuring that the
appropriate skills, knowledge, and diversity are in
place to ensure the future success of the Group.
The Group looks to appropriately incentivise teams,
to ensure long-term alignment with shareholder
objectives.
Market
perception &
reputational
risk
Uniphar plc is a publicly listed
company and must communicate
to the market and stakeholders
regularly with updates on financial
performance and key metrics.
The Group has financial reporting structures
and timelines in place to ensure accurate and
timely reporting. The Board reviews the financial
and operating performance, together with the
implementation of the strategic plan.
Failure to deliver in line with
expectations may result in
reputational damage impacting
the Group’s ability to achieve
strategic targets.
The Group Investor Relations team actively engages
with the investment community. The team ensures
a timely and accurate communication of information
to the market.
A positive corporate culture reinforces ethically
responsible behaviour in the business.
TRENDING
↗
↕
↕
↕
30
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS STRATEGIC RISKS Continued
OPERATIONAL RISKS
RISK
IMPACT
MITIGATION
Loss of
competitive
position
Changes in the competitive
environment in which the Group
operates may occur as a result of
new market entrants, loss or material
change in the terms of key customers
or key suppliers, new technologies or
regulatory changes.
The Group continues to monitor market trends and
demands, to maintain its competitive edge. Individual
business management teams manage the supplier
and customer relationship and keep informed of
any changes in their business strategies. Value-add
and unique services are offered to enhance the
relationship and promote customer loyalty.
TRENDING
↕
Failure of the Group to respond to
any of these may result in the loss
of its competitive edge and market
share, which may put pressure on
profitability and margins.
Strategic acquisitions enhance the commercial
relationships within the pharmaco-medical market
and provide a wider and more diverse service
offering, protecting the competitive position.
Environment &
Sustainability
The increasing global focus on
environmental and sustainability
governance is recognised by the
Group, and its stakeholders.
The Group recognises the lasting impact its
actions can have on the environment and is
committed to operating sustainably and reducing
its environmental impact.
↗
Brexit
Failure to appropriately assess,
monitor, report and manage the
Group’s impact on the environment
and the communities in which it
operates may result in reputational
damage, impacting the Group’s ability
to deliver results.
The Group is subject to an increasing
number of environmental and climate
change regulations and legislation,
which may negatively affect the
Group’s business if it fails to
adequately comply with them.
The post-Brexit environment poses
several risks for the Group, due to
uncertainty and complexities as to the
future fiscal and regulatory landscape
in the UK and Northern Ireland.
This may have a negative impact on
supply and trade.
Brexit, together with political
uncertainty in the UK, has the
potential to create market unease
and currency fluctuations which
could impact the translation of
our UK operations into the Group
reporting currency.
The Group’s Sustainability Council drives the
sustainability agenda across the Group and ensures
that sustainability targets are integrated across
all businesses. The Group engages with external
advisors throughout the year to ensure it is prepared
for upcoming reporting obligations.
The Group’s banking facilities incorporate
sustainability provisions that will enable discounted
rates of interest for achieving specified ESG goals
and benchmarks. Furthermore, bonus metrics for
Executive Directors and some senior management
include specific sustainability and governance
targets to ensure focus on achieving continuous
improvements in this area.
Since the withdrawal of the UK from the European
Union in early 2020, the Group has navigated the
challenges presented by Brexit successfully and
continues to monitor the evolving landscape.
The Group is continuing to expand its operations in
Europe and the US creating geographical diversity.
The Group monitors currency fluctuations for
subsidiaries that operate in countries outside of
the Eurozone.
Brexit has also presented opportunities in
Commercial & Clinical for outsourced services and in
Product Access for specialist procurement services.
TRENDING
↗
RISK
IMPACT
MITIGATION
Cybercrime
In common with all large
organisations, the Group is exposed
to risk relating to cyber events
threatening the availability or integrity
of our systems and data. There is
a constant threat of sophisticated
cyber-attacks including ransomware,
phishing and malware. An adverse
event could result in significant
reputational, operational and
financial damage.
The Group is also exposed to the
risk of an attack on our business
partners that could negatively impact
the Group.
The Group has IT security processes in place to
minimise the occurrence of cyber-attacks. Continuous
user awareness is a key measure used in helping to
protect against the threat of a cyber-attack.
External audit and penetration testing is carried
out to identify vulnerable areas and put in place
mitigating controls.
The Group has invested in a dedicated IT Security
team led by the Director of Information Security to
continuously review, monitor and strengthen the
preventative and detective controls required to
protect against a cyber related incident and draws on
appropriate external support to achieve this objective.
IT systems
Digital capabilities are a specific
strategic offering of Uniphar, and the
alignment of the IT strategy with the
business strategy is essential.
The IT strategy is a key factor in the Group’s strategic
planning process. This ensures that the development
of our IT systems and processes remains aligned with
Group objectives.
↕
↕
Pandemic
risk
The Group is reliant on the
effectiveness of its IT systems and
network. Any interruption or downtime
may have a negative impact on
the Group’s operations, financial
conditions, and competitive position.
Global pandemics have the potential
to cause significant disruption to the
Group and the wider global economy.
Although the risk from Covid-19 has
subsided in recent months there is still
a risk that other variants or pandemics
may arise in the future. Such a
pandemic could severely impact our
financial results or cause supply chain
disruption that would impact the
business and its operations.
The Group actively monitors the performance and
robustness of our IT systems. The in-house IT team
works in tandem with external providers to ensure all
business-critical processes are safeguarded.
A business continuity plan is in place to ensure the
uninterrupted provision of services and to enable the
restoration of key systems, if necessary. Continued
technology investment is essential to support
the enlarged Group, and a multi-year technology
transformation programme has commenced, with the
initial focus on ERP platforms.
The safety and wellbeing of our people is our first
priority and if a new pandemic emerges the Group will
rely on the mitigation strategies developed during the
Covid-19 pandemic. Uniphar plays a significant role
in the healthcare infrastructure of the countries we
operate in and the Supply Chain & Retail infrastructure
was considered an essential service during the
previous pandemic.
The Group continues to monitor the preparedness
of the business for another pandemic to ensure that
appropriate response strategies are in place.
Transformational
project
execution
The Group is embarking on several
transformational projects that
will provide it with the platform
and capacity to grow over the
coming years.
The Group has implemented appropriate project
management structures to ensure projects are
delivered in line with their plans. Appropriate Project
Management resources have been added to the
organisation to facilitate this.
NEW
RISK
Furthermore, the Group utilises external advisors to
supplement our internal knowledge where specialist
skills are required.
The Group has identified Transformational
project execution as a new Strategic risk in 2022.
Significant transformation
programmes bring inherent risks such
as an inability to manage change in
the organisation or to deliver projects
within time and budget constraints.
Failure of the Group to satisfactorily
deliver such projects may result in
cost overruns or reputational damage
impacting the Group’s ability to
deliver strategic targets.
31
↖
32
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS OPERATIONAL RISKS Continued
RISK
IMPACT
MITIGATION
Business
interruption
The Group may be unable to
provide a service to customers,
due to external factors affecting its
operations such as, natural disasters,
environmental hazards, or industrial
disputes, resulting in potential lost
sales and loss of customer loyalty.
A business continuity plan is in place and is updated
and reviewed continuously to mitigate the risks to
operational continuity.
FINANCIAL RISKS
TRENDING
↕
RISK
Foreign
currency
Health & Safety Uniphar distributes pharmaceuticals
and medical devices to pharmacies,
hospitals, and patients. Uniphar also
provides consultancy services to a
range of healthcare practitioners.
Failure to follow all applicable
regulations and guidance could
impact patient safety.
Dedicated quality functions are in operation across
the Group, ensuring that we adhere to and comply
with good distribution practice, pharmacovigilance
and regulatory requirements.
↕
A robust health and safety framework is in place
to ensure that we have effective health and
safety processes.
The health and safety and wellbeing
of our staff is also paramount.
With large operational facilities in
various locations, it is essential we
adhere to the highest standards of
health and safety throughout the
organisation. Failure to implement
and follow proper health and safety
procedures could have adverse
effects on our people or patients.
Laws,
regulations and
compliance
Uniphar operates in a highly regulated
environment and is subject to both
local and international laws and
regulations in the jurisdictions where
we operate.
Failure to operate under any of
these stringent laws and regulations
could result in financial penalties,
reputational damage, and risk to
business operations.
The Board has overall responsibility for the Group’s
corporate governance environment. Our strong
corporate governance culture prioritises continuous
improvement.
↕
The Group General Counsel and Company Secretary
is responsible for the oversight of compliance
across the Group. The Group also has an extensive
quality and regulatory team, who ensure compliance
with all applicable regulations relating to our
service offerings.
In the area of GDPR, the Group has a dedicated
Data Protection Compliance Officer and Data
Protection Officers within each division. The Data
Protection Compliance Officer provides group
guidance and governance to the divisional Data
Protection Officers.
In addition, the Group ensures that professional
and appropriately qualified personnel are employed
in positions of responsibility.
Education and internal training are provided on
updates to laws and regulations, as appropriate.
IMPACT
MITIGATION
The Group’s reporting currency is the
euro. Exposure to foreign currency
occurs in the normal course of
business, as the Group operates in
jurisdictions outside of the Eurozone.
The Group’s activities are primarily conducted in the
local currency of the operation, which results in low
levels of transactional risk. The foreign currency risk
has increased in recent years, due to acquisitions in
jurisdictions outside of the Eurozone.
The ongoing expansion of the Group
outside the Eurozone, combined with
the volatility experienced in currency
markets in 2022, leads to an increase
in this risk.
The Group reduces its exposure to currency
fluctuation by matching foreign currency payments
and receipts across business units. The current
banking facility permits drawdown across multiple
currencies, which can create a natural hedge.
TRENDING
↗
Treasury
The Group is exposed to liquidity,
interest rate and credit risks.
The recent increases in interest rates
impact the Group by increasing
interest costs on outstanding
borrowings.
The Group Treasury Policy sets out how these risks
are managed. The policy is reviewed and approved
by the Audit, Risk and Compliance Committee.
↕
Cash forecasting and effective management
reports are in place to monitor and minimise the
financial risk. The current banking facility agreement
provides sufficient headroom for the Group in terms
of liquidity.
The Group monitors and manages its net bank
debt and leverage and seeks to actively manage
cash flow conversion, to minimise debt levels and
associated interest costs.
The Group continues to ensure
that the risk management
framework is integrated in its
day-to-day activities.
33
34
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS SUSTAINABILITY AND
GOVERNANCE REPORT
Enabling
Sustainability
through
Strategy
CEO Sustainability Statement
Pillars and Materiality
People and Workplace
Community Involvement
Environment and Sustainability
Governance, Quality and Compliance
Business Solutions and Innovation
37
39
41
43
45
51
53
35
35
36
UNIPHAR PLC ANNUAL REPORT 2022 CEO SUSTAINABILITY STATEMENT
Sustainability Driving
our Performance
2022 saw a continued emphasis on
the Group’s sustainability agenda and we are
delighted and proud of the progress we are
making across all five sustainability pillars.
Sustainability remains a focus for the
Group and a key element in defining
the Group’s strategy and decision
making going forward. In early 2023,
the Board approved the expansion
of the remit of the Nominations,
Governance and Sustainability
Committee to include oversight of
the Group’s sustainability agenda
and executive remuneration continues
to be linked to the achievement of
sustainability objectives.
People & Culture
During 2022, the Group launched
Unity@Uniphar, an initiative that
focuses on inclusivity and uniting our
workforce for common purposes.
We ran a number of initiatives under
the Unity@Uniphar umbrella this
year including our Unity for Ukraine
and Unity for Hope events. We also
launched two employee resource
groups – the Women’s Alliance,
supporting women across our
business and the Rainbow Alliance,
supporting our LGBTQi+ colleagues.
After successful launch events and
webinars, during the year, the Group
is continuing to build out the mission
and vision for these groups to ensure
that they are meeting the needs
of our workforce. In this regard,
a questionnaire was circulated to
all teams during National Inclusion
Week in September to ensure that
these employee resource groups
are built on feedback from our wider
workforce. We will continue to focus
on ED&I initiatives during 2023 and
we look forward to building on the
foundations established during 2022.
Supporting our Community
In early 2022, we set up Unity for
Ukraine, to raise funds and provide
badly needed medicines and medical
equipment to alleviate the terrible
humanitarian crisis caused by the
invasion of Ukraine. In October,
we ran our annual fund-raising event
for cancer, named Unity for Hope this
year, raising €150k for our cancer
charity partners, globally. These are
just two examples of the great
community work done by Uniphar
people around the world. I am really
proud of the huge efforts made by so
many of our team to support those
in need of help.
Emissions Targets and
Climate Reporting
The focus for our environmental pillar
during 2022 was embedding climate
awareness and reporting in each
of our businesses and broadening
our climate reporting to include a
Scope 3 analysis for the first time.
This was our third year of Group-wide
carbon emissions reporting and we
are delighted to have increased our
CDP (Carbon Disclosure Project)
rating from a ‘C’ to a ‘B’ during the
year. We believe this increase in rating
reflects the key role that sustainability
and climate reporting now play in
our business.
A number of decarbonisation
workshops were run during the year
for our senior leaders and across
our businesses. Green Teams were
appointed in each of our divisions,
tasked with assessing historic
emissions data and preparing a
decarbonisation plan for their division.
This is to ensure that we meet our
internal interim target to reduce our
absolute Scope 1 & 2 emissions by 5%
per annum between 2019 and 2030,
in line with the SBTi 1.5˚ C aligned
pathway for targets, which would see
us achieve our climate ambition of at
least 50% reduction in our absolute
Scope 1 & 2 emissions by 2030.
We completed our first Scope
3 assessment during the year.
This demonstrated the enormous
impact of our purchased goods and
services relative to emissions from our
own facilities. Following our Scope 3
assessment, we formally submitted
our Science Based Targets to SBTi
in early 2023 and we are awaiting
validation of those targets. We have
engaged external advisors to assist
with a structured programme of
supplier engagement to ensure that we
work together to reduce our collective
impact on the environment.
Our banking facility was renewed
and expanded in August and the new
facility incorporates sustainability
provisions that will enable discounted
rates of interest for achieving specified
ESG goals and benchmarks.
Sustainability Governance and Oversight
Sustainability governance and oversight was a key
topic for our Board and Executive Leadership Team
during 2022. In early 2023, the Board resolved to
expand the remit of the Nominations & Governance
Committee to include sustainability oversight and
the Committee was renamed the Nominations,
Governance and Sustainability Committee. The
Committee will be supported in its work by the
Sustainability Council which has been in place
across the business since 2020. The Group has
appointed a number of working groups and ‘Green
Teams’ across the business to drive the sustainability
and environmental agenda and initiatives locally in
each division.
Board
Oversight
Nominations,
Governance &
Sustainability Committee
Executive
Executive
Sustainability Council
Working
Group
Working
Group
Working
Group
Working
Group
Working
Group
Sustainable Development Goals
Uniphar fully endorses the UN Sustainable
Development Goals (‘SDG’) and we consider
the following goals to be the ones where we can
make the most significant contribution:
AA
Our MSCI rating
increased from an ‘A’
to ‘AA’ during the year.
Sustainability Engagement
We are proud to have improved our external
sustainability ratings during 2022. We are delighted to
have achieved an outstanding score from Sustainalytics,
ranking us in the first percentile (out of 636) of global
healthcare companies and the third percentile (out of
15,634) of all companies rated by Sustainalytics globally.
We also increased our MSCI rating from an ‘A’ to ‘AA’
during the year and increased our CDP rating from a ‘C’
to a ‘B’. This continuous improvement is really important
to us at Uniphar and we believe these scores are
testament to our focus across all of our sustainability
pillars and demonstrate that sustainability has always
been at the heart of how we operate our business.
Looking Forward
I would like to extend a huge thanks to our teams,
colleagues, suppliers and partners who supported our
various sustainability initiatives this year, particularly our
Unity for Ukraine and Unity for Hope events. I look
forward to many more events under our Unity@Uniphar
umbrella to demonstrate the power we can have when
we come together.
As we look ahead to 2023, we will continue to keep
sustainability at the heart of how we run our business
and we will focus on continuing to improve our
monitoring and reporting in this key area, with an
emphasis on embedding KPIs within our business
across all five pillars. We are also actively preparing
to align our sustainability reporting with the Corporate
Sustainability Reporting Directive (‘CSRD’).
Ger Rabbette
Chief Executive Officer
We acknowledge the importance of all 17 SDGs
and will work together with our stakeholders to
contribute to each of them.
37
38
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS PILLARS AND MATERIALITY
Uniphar has identified five strategic pillars that define our
approach to sustainability. We have identified the areas and
metrics that are perceived as the most material in our industry.
PILLAR
WHAT THIS PILLAR MEANS TO US
RELEVANT SDGS
MATERIALITY
INITIATIVES DURING 2022
People and
Workplace
Our people are our most important resource, and we are
committed to making Uniphar a fulfilling and inclusive
place to work.
Community
Involvement
Supporting employees to actively participate in the local
communities where we are based is a long-standing
objective for the Group and is achieved through serving
the community and supporting good causes.
Environment and
Sustainability
As the business grows and our geographical
footprint expands, we remain committed to managing
our environmental responsibilities effectively.
Governance,
Quality and
Compliance
Operating in healthcare markets that are highly regulated
and demand high quality and compliance standards, drives
our quality focus and culture of continuous improvement.
Ensuring the highest standards of governance, quality and
compliance is fundamental to our business.
Business Solutions
and Innovation
We believe a positive difference will be achieved through
collaboratively developing innovative business solutions
across all our divisions, resulting in a more sustainable
business and better outcomes for our stakeholders.
1
R
A
L
L
P
I
2
R
A
L
L
P
I
3
R
A
L
L
P
I
4
R
A
L
L
P
I
5
R
A
L
L
P
I
39
» Diversity & Inclusion Practices
» Employee Health & Safety
» Employee Wellbeing
» Employee Training
» Employee Labour Practices
» Charity & Fundraising
» Active Community Support
» Customer Privacy
» Customer Welfare
» Energy Management
» Greenhouse Gas Emissions
» Waste & Hazardous Waste
Management
» Pollution Prevention
» Sustainable Transport & Logistics
» Focus on ED&I
» Launch of two Employee Resource
Groups – Women’s Alliance and
Rainbow Alliance
» First Groupwide Leadership Event
» Launch of Groupwide HR
Information System
» Hybrid Working Model
» Launch of Unity@Uniphar
» Unity for Ukraine Initiative
» Unity for Hope Annual Cancer
Fundraiser
» Local Charity Initiatives
» Data Privacy & Cyber Security
» Groupwide Carbon Footprint
across Scopes 1, 2 and 3
» Improved CDP Rating from
‘C’ to ‘B’
» Scope 3 Assessment
» Groupwide Decarbonisation Plans
» Planning Supplier Engagement
Programme
» Product Quality & Patient Safety
» Business Ethics
» Systemic Risk Management
» Critical Incident Risk
Management
» Legal & Regulatory Requirements
» Selling Practices & Product
Labelling
» Step up to UK Code
» Expanded remit of Nominations,
Governance and Sustainability
Committee
» Shareholder Engagement on topic
of ESG
» New Climate Change Risk on
Risk Register
» Data Protection Structure
» Business Model Resilience
» Innovation
» Supply Chain Management
» Digital Focus & Appointment of
Director of Information Security
» Acquisitions
» Planning Supplier Engagement
Programme
40
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
PEOPLE AND
WORKPLACE
1
R
A
L
L
P
I
Equity, Diversity & Inclusion
At Uniphar, our aim is for our
workforce to be truly representative
of all sections of society and for
each employee to feel respected
and able to give their best.
The collective sum of the individual
differences, life experiences,
knowledge, inventiveness, innovation,
self-expression, unique capabilities,
and talent that our employees invest
in their work represents a significant
part of not only our culture, but of our
reputation and the Group’s overall
success. We embrace and encourage
the differences that make our
employees unique.
80
70
60
In 2022, the Group launched our
Unity@Uniphar umbrella initiative,
designed to promote an inclusive
culture and unite people across our
business. As part of this initiative,
we launched two employee resource
groups – our Women’s Alliance and
our Rainbow Alliance. The concept
behind global employee resource
groups is to create a community of
support and empowerment for the
people directly concerned and the
people who would like to join them
30
10
50
20
40
0
S
G
D
S
T
N
A
V
E
L
E
R
as allies. We want to encourage
women, members of the LGBTQi+
community and their allies to connect
and support each other across
teams, businesses and geographies,
regardless of how they identify,
and where they are based.
Uniphar is also committed to an
ongoing focus on developing our
global talent pool and building a
more diverse leadership team for
the future. As at 31 December
2022, women accounted for 27%
of senior management and 65% of
total employees. This demonstrates
an increase in female representation
at both senior management level
and across the global workforce
Male
Female
75%
73%
25%
27%
65%
35%
Directors
Senior
management
All
employees
Diversity was a key
topic at Board level
during 2022.
during 2022. Diversity was also
a key topic at Board level during
2022, as the Chair and Company
Secretary embarked on a
shareholder engagement programme
with investors.
Diversity is a key area of focus
for many of our investors. Although
25% of the Directors on the Board
are female, the Board is cognisant
that this falls short of the Balance
for Better Business guidance of
33% female representation by 2023.
In light of this, they have set a target
of 33% female representation on the
Board by the end of 2023. In January
2023, the Board also approved a
Board Diversity Policy to formalise
and expand on their commitment
to diversity. The policy sets out the
Board’s commitment to diversity in
succession planning, to ensure an
inclusive and diverse Board.
The actions that we have taken, to date, to promote ED&I, and those that we intend to roll out across the Group are
set out below:
WHAT WE HAVE DONE SO FAR
» Launched Uniphar ED&I Policy
» Launched Women’s Alliance and Rainbow Alliance
Employee Resource Groups
» Rolled out hybrid working guidelines to our employee
population where possible
» Applied flexible working practices to our employee
population where possible
WHAT WE WILL BE DOING
» Promote company ED&I Policy and Employee
Resource Groups to enhance employee awareness
and allyship
» Roll out of ED&I awareness training to our employees
» Develop a recruitment policy and consistent
recruitment practices which incorporate our
ED&I principles
» Build a talent development framework to develop a
diverse pipeline for key roles
41
gender
Gender Pay Gap Reporting
In 2022, for the first time in the
Republic of Ireland, organisations
employing more than 250 people
were required to publish information
on the gender pay gap under the
Gender Pay Gap Information Act
2021. A gender pay gap measures
the difference between the average
earnings of all women and men
across the business, irrespective
of the work they do, expressed as
a percentage of men’s earnings. In
accordance with the Republic of
Ireland and UK Government Gender
Pay Gap Regulations, our Gender Pay
Gap Reports in respect of the relevant
entities within the Group for 2022 are
available on the Group website at
www.uniphar.ie/static/sustainability/
people-workplace/
Health and Safety
The health and safety and wellbeing
of our people is paramount to
Uniphar. With large operational
facilities across various locations,
it is essential that we adhere to the
highest standards of health and
safety throughout the organisation,
ensuring that best practice is adhered
to at all times.
Uniphar provides training courses
on a regular basis, including training
on Good Distribution Practices
(GDP), manual handling and first aid.
We monitor and investigate all safety
concerns and analyse this data,
in order to continuously improve.
The number of reported health and
safety incidents increased during
2022, with motor vehicle incidents
accounting for 47% of all recorded
incidents across the Group in 2022.
We believe this increase in reported
incidents reflects the increased
emphasis on health and safety
reporting across the business.
We are committed to continuing to
improve our health and safety risk
assessment processes and incident
reporting, and embedding more
Number of H&S incidents
175
122
121
141
2022 2021 2020 2019
We were delighted to
re-open our Group
headquarters in
Citywest in April 2022
following a significant
re-design and
refurbishment project.
detailed health and safety KPIs
across our businesses. This is a key
area of focus for the Group for 2023.
Wellbeing
In 2022, our focus on wellbeing
continued as we looked to continue
to support our teams and keep our
colleagues healthy and mentally
well. During 2022, we implemented
a wide range of initiatives to support
our teams across the Group,
including the roll out of our employee
resource groups and a webinar on
change management, resilience
and support networks hosted by
‘Tackle Your Feelings’.
Like many workplaces, the emphasis
on work-life balance continued,
following a return to some normality
during 2022 after the Covid-19
pandemic. It is fundamental that our
people feel supported in achieving
this balance and our Hybrid Working
Guidelines assist those who can avail
of hybrid working to find that balance.
We were also delighted to re-open
our Group headquarters in Citywest
in April 2022, following a significant
re-design and refurbishment project.
The space is designed to facilitate
a more flexible working model
with plenty of bright spaces for
collaborative working and connecting
with colleagues. The incorporation of
plants and greenery into the design
concept adds to the modern aesthetic
of the redesigned workplace.
Training and Development
Uniphar is committed to supporting
and investing in the professional
development of our employees.
The Group provides a range of career
development opportunities which
enable our employees to reach
their full potential and grow within
our business. We also continue to
support our employees through
further education and professional
exams.The implementation of our
new global HR Information System
during 2022 will assist with the
rollout and monitoring of training
and development across our various
businesses in a more consistent way.
Labour Practices
The Group is committed to complying
with the highest labour standards
across all jurisdictions in which we
operate. Attracting and retaining
the right people is essential for
the success of our business.
Equality underpins our recruitment
activity, ensuring that recruitment
and selection processes promote
fairness. The Group’s ED&I Policy
outlines our approach to equity,
diversity and inclusion and reaffirms
our commitment to equality for all
employees and potential employees.
The Group’s Dignity at Work Policy
recognises the right for all employees
to be treated with dignity and respect
and the Group is committed to
providing all employees with a safe
working environment which is free
from bullying, harassment and sexual
harassment. The Group has a Modern
Slavery Policy in place. This is
available on the Group website:
www.uniphar.ie.
The Group also recognises the
trade unions of which some of
its employees are members and
engages with them as necessary.
42
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
COMMUNITY
INVOLVEMENT
2
R
A
L
L
P
I
S
G
D
S
T
N
A
V
E
L
E
R
Uniphar’s Charity Partners
During 2022, we launched
Unity@Uniphar to act as an umbrella
for inclusivity, community and
charitable activities that Uniphar
colleagues get involved in across all
divisions and geographies. This year,
we worked together on two key
initiatives – Unity for Ukraine and
Unity for Hope. Unity for Ukraine
raised funds, medical equipment
and other healthcare materials to
send to Ukraine to help alleviate the
humanitarian crisis caused by the
war that began in 2022. Colleagues
from across the business worked
with suppliers, manufacturers and
customers to provide medicines,
PPE and medical devices to the value
of approximately €880k.
Our second major initiative was
Unity for Hope (formerly called
Relay for Hope), which is now in
its third year of raising money for
cancer charities around the world.
This is an activity-based challenge
that encourages teams to raise their
stepcounts. In 2022, we collectively
covered more than one million steps
with colleagues around the world
organising everything from walks on
Australian beaches to sea swimming
to walking tours of Washington DC.
Altogether, a total of €150k was
raised for our chosen cancer causes
in Ireland, Europe and the US.
Active Community Support
The core business of each of
our divisions is rooted in serving
and supporting local and global
communities. Our Supply Chain &
Retail teams ensure timely, secure
delivery of essential medicines to Irish
pharmacies and hospitals as well as
providing expertise and support to
pharmacies across Ireland, relieving
some of the administrative burden
on pharmacists and enabling them
to focus their efforts on serving their
patients. Our Commercial & Clinical
Division is also focused on providing
outsourced sales, marketing and
distribution solutions to pharma
and medical device manufacturers,
ensuring access to leading healthcare
technologies and medicines in the
geographies we serve. Our Product
Access Division, through its On
Demand and Exclusive Access
business units, ensures access
to unlicensed and hard to source
products and its Aid and Development
team also works with global charity
partners to ensure medicines and
medical supplies can be provided
to those most in need. Uniphar also
supports a variety of local community
initiatives across each of our
businesses and locations.
Community Sponsorship
During 2022, the Group sponsored
a number of local and national
events including the Irish women’s
hockey under-21’s team and the
under-23’s Five Nations tournament
with Ukraine, the Netherlands, USA
and India competing at the National
Hockey Stadium, Dublin.
Customer Privacy and GDPR
We are committed to protecting the
personal data that we process as part
of our service provision. We ensure
that customers can trust us to keep
their personal data safe and that
they have a clear understanding
of how and why the data is used.
Uniphar has a robust GDPR
framework in place, to ensure that
we are operating consistently across
the organisation and in accordance
with applicable laws.
The Group applies the following data
protection principles:
» Governance – We have appointed
designated Data Protection
Officers within each division.
Their role is to monitor, advise
and inform senior management
regularly regarding compliance.
» Transparency – We are open and
honest about how and what data
we process. We only use personal
information for specified fair and
lawful purposes.
» Data Minimisation – We only
collect necessary and relevant
personal information.
» Accountability – We continually
monitor and assess regulatory
compliance. We provide training
to all personnel.
» Retention – We do not retain
personal information for longer
than is necessary.
» Accuracy – We keep personal
information accurate, complete,
and up-to-date.
» Access Rights – We respect
individuals’ rights and choices.
» Security – We use appropriate
security safeguards to protect
personal data.
» International Transfer – We ensure
protection for international
transfers of personal information.
» Privacy by Design – We implement
appropriate measures to ensure
the principles of privacy by design
and default are embedded into our
processes and systems.
» Risk Assessments – We evaluate
new business processes to ensure
that they do not present any risk to
data subjects.
The Group has a Privacy Policy
which is available on the Group’s
website: www.uniphar.ie/static/
privacy-statement and a Data
Protection Policy, which is available
to the workforce.
Customer Welfare
The needs of our customers,
the pharmacies, hospitals,
manufacturers and patients we
serve are always paramount.
Our can-do attitude, coupled with our
commitment to the highest standards
of product quality and patient safety
ensured this important topic remained
a priority throughout the year.
Further details of our commitment to
quality and ensuring patient safety
are set out in our Governance,
Quality and Compliance Reports.
43
44
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
ENVIRONMENT AND
SUSTAINABILITY
3
R
A
L
L
P
I
Energy Management
We understand that our activities
can have a lasting impact and we
believe in protecting our environment
for the benefit of future generations.
We are committed to achieving our
Sustainable Development Goals
(SDGs) of Responsible Consumption
and Climate Action.
We are now in our third year of group-
wide carbon reporting and the data
gathered since 2019 has given the
Group an understanding of the energy
usage of the Group as a whole.
The Citywest facility, our largest
facility, has energy monitoring
software, providing a granular view
of electricity usage throughout the
facility. This software has enabled
us to identify areas of inefficient
electricity usage, for example lights
and electrically powered systems
remaining on during non-operational
hours. Using this information,
we are able to develop systems
and processes to reduce energy
consumption.
Greenhouse Gas Emissions
In 2022, we completed the Group’s
second Group-wide carbon foot-
printing exercise to assess our
Scope 1 & 2 carbon emissions
and we also completed the first
assessment of our Scope 3
emissions. The outcome of that
assessment was reported through
CDP and we were delighted to
receive an increase in our CDP
score from ‘C’ to ‘B’ on foot of
that submission.
S
G
D
S
T
N
A
V
E
L
E
R
In early 2023, we completed our
carbon foot-printing exercise
in respect of our Scope 1 & 2
emissions during 2022. The results
of this exercise are set out below
(excluding entities acquired during
2022 and adjusting all results to
include entities acquired during 2021
for the first time). Following a 26.5%
reduction in Scope 1 & 2 emissions
from 2019 to 2021, 2022 saw a slight
increase in Scope 1 & 2 emissions
of just over 5% on an absolute
basis. This represents a 22% overall
reduction in absolute Scope 1 & 2
carbon emissions since our baseline
reporting year of 2019. The Group’s
carbon intensity measurement has
increased by 1% during the year.
We believe the marginal increase
in emissions during 2022 reflects a
normalisation of emissions following
Covid-19 during 2020 and 2021.
Based on the analysis carried out,
a large proportion of the reduction in
Group emissions, to date, has arisen
as a result of a reduction in company
car usage across the Group.
We believe the reason for this is
two-fold. Firstly, the healthcare
industry saw a big drop in the number
of in-person visits to healthcare
providers during 2020 and 2021
as a result of Covid-19. The second
reason is that in recent years our
Commercial & Clinical Pharma
Division has shifted to an omni-
channel engagement model which
enables the teams to engage with
healthcare professionals through
mediums other than in-person
office visits. We believe that the
move to the omni-channel model
and changes in the preferences of
healthcare professionals will mean
that emissions from company cars
will remain significantly lower than
pre-Covid levels. With the increasing
availability of electric vehicles,
we expect this reduction to continue.
Another reason for the significant
reduction in emissions in the period
since 2019 is the introduction of
energy efficiency initiatives such
as lighting sensors, LED lights,
and energy monitoring.
Group Intensity Measure
tCO2e/Million € Revenue
2019
4.35
2020
3.23
2021
2.88
2022
2.92
Emissions (tCO2e)
2019
2020
2021
2022
Scope 1
4190.79
2814.74
2637.60
2854.42
Scope 2 (Location Rate)
3360.37
3039.09
2935.26
3018.83
Total
7551.16
5853.83
5572.86
5873.25
Uniphar Group Emissions by Emissions Source
2019
2020
2021
2022
3,500
3,000
2,500
2,000
1,500
1,000
500
0
3,360
3,039
2,935 3,019
3,012
1,934
1,630 1,635
1,010 1,080
948
764
4
0
1
0
165
105
54
156
Natural Gas
Oils
Vehicles
Leaked
Refridgerants
Electricity
(Location Rate)
Scope 3
In 2022, we completed our first Scope 3 emissions
screening with the assistance of external environmental
consultants. This process identified the enormous
significance of purchased goods and services as a
contributor to the Group’s overall carbon footprint. Our
purchased goods and services category analysis was
based on spend data which was inputted to the EEIO
spend-based tool.
As can be seen from the diagram below, purchased goods
and services represent 94% of the Group’s overall carbon
emissions. As such, measures and initiatives to reduce
emissions from the goods and services that we purchase
are essential to reducing the environmental impact of
our business.
Uniphar Group Emissions by Category
Purchased Goods
& Services
94%
Targets
The Group formally committed through the Science Based
Target Initiative (SBTi) to setting a science-based target
before the end of 2023 and, in early 2023, we submitted
our targets for validation to the SBTi. Pending validation of
our SBTi targets, we have set an internal target to reduce
our absolute Scope 1 & 2 emissions by 5% per annum
between 2019 and 2030, in line with the SBTi 1.5˚ C
aligned pathway for targets. This would see us achieve our
climate ambition of at least 50% reduction in our absolute
Scope 1 & 2 emissions by 2030.
As part of our commitment to SBTi, we have also
submitted a target that 71% of our suppliers covering
purchased goods and services, will have science-based
targets for emissions by 2028. In order to achieve this
we propose to roll out an active supplier engagement
programme to work with our suppliers and partners
in tackling the challenges of reducing emissions and
identifying ways in which we can work together with
them to reduce our collective emissions.
3rd Party Logistics 4%
Business Travel 1%
Scope 1 & 2 1%
Employee Commute 0.1%
Franchises 0.0%
End of Life Treatment of
Sold Product 0.2%
Waste 0.0%
Other Fuel and Energy 0.1%
45
46
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
100
80
60
40
20
0
-20
-40
Decarbonisation
In 2022, a number of ‘Green Teams’ were established
across each of our divisions. Following externally
facilitated training on the topic of decarbonisation, each
team was tasked with assessing the emissions for their
respective divisions and developing a decarbonisation
plan outlining how that division could achieve our climate
ambition of at least 50% reduction in our absolute Scope
1 & 2 emissions by 2030. A consolidated output from that
exercise is presented below and the Group are currently
working on timelines for implementation
of these initiatives.
Increase
Decrease
Total
120
100
80
60
40
20
0
100%
-22%
-7%
6%
-37%
-1%
39%
Reduction to Date
Renewable Energy
Facilities Change
Baseline Emissions
Energy Efficiency
Behavioural Change
Group Emissions
TCFD and EU Taxonomy
2022 saw continued discussion around environmental
matters and emissions by the Board. The Board
received regular reports from the Sustainability Council
and considered specific climate-related risks and
opportunities as part of its bi-annual Risk Register Review.
Further details in relation to the Group’s actions,
in alignment with Taskforce on Climate-Related Financial
Disclosures (TCFD) are set out in the following table.
In addition, the Group carried out its first assessment
of the extent to which the Group’s activities are aligned
to The EU Taxonomy Regulations and the results of this
assessment are set out in the Directors’ Report on page
109 of this report.
Taskforce on Climate-Related Financial Disclosures (TCFD)
Recommendation
Response
Governance
Describe the Board’s
oversight of climate-related
risks and opportunities
The Board is responsible for overall Group climate-
related risks and opportunities oversight. The Risk
Register of the Group is presented to the Board twice
a year and as part of this process the Board now
considers a specific sub-set of climate-related risks
and opportunities. The remit of the Nominations &
Governance Committee was also expanded to include
sustainability oversight in early 2023.
Page
Environment &
Sustainability
Section, page 45
Strategy
Risk
Management
Metrics and
Targets
Describe managements
role in assessing and
managing climate-related
risks and opportunities
Describe the climate-
related risks and
opportunities the
organisation has identified
over the short, medium and
long-term
Describe the impact of
climate-related risks
and opportunities on
the organisation’s
businesses, strategy and
financial planning
Describe the resilience of
the organisation’s strategy,
taking into consideration
different climate-related
scenarios, including a 2°C
or lower scenario
Describe the organisation’s
processes for identifying
and assessing climate-
related risks
Describe the organisation’s
processes for managing
climate-related risks
Describe how processes
for identifying, assessing,
and managing climate-
related risks are integrated
into the organisation’s
overall risk management
Disclose the metrics used
by the organisation to
assess climate-related risks
and opportunities in line
with its strategy and risk
management process
Disclose Scope 1, Scope 2,
and, if appropriate,
Scope 3 greenhouse gas
(GHG) emissions, and the
related risks
Describe the targets used
by the organisation to
manage climate-related
risks and opportunities
and performance
against targets
Climate-related risks are assessed and
managed as part of the Group’s overall risk
management framework.
Risk Management
Section, page 27
Climate Change Risk is a risk identified on the Group’s
Risk Register. As part of the Board’s Risk Review
the Board also considered specific climate risks
and opportunities and these are set out in further
detail on page 49.
Risk Management
Section, page 27
Environment &
Sustainability
Section, page 45
See the disclosures on page 49 in respect of specific
climate-related risks and opportunities identified
by the Group.
Environment &
Sustainability
Section, page 45
Uniphar conducted a qualitative transitional scenario
analysis using the IEA NZE 2050 (1.5C) scenario and
a qualitative physical scenario analysis using the RCP
8.5 (>3C) scenario. This assisted Uniphar in identifying
material risks and opportunities for future climate
scenarios. See further details on page 49 in relation to
the scenario analysis conducted during 2022.
Environment &
Sustainability
Section, page 45
Climate-related risk management is integrated
into Uniphar’s overall risk management structures
and considered by the Board as part of the Risk
Management Framework.
Risk management
section, page 27
In addition to greenhouse gas emissions data, Uniphar
discloses waste metrics.
Environment &
Sustainability
Section, page 45
Uniphar has disclosed Scope 1 & 2 emissions since
2020. In 2022, Uniphar did a full screening of Scope 3
emissions, in preparation for their Science Based
Target submission.
Environment &
Sustainability
Section, page 45
Uniphar have submitted targets in respect of Scope
1, 2 and 3 emissions to the Science Based Targets
Initiative (SBTi) for validation. Pending validation of
those targets, Uniphar have set internal Scope 1 and 2
emissions targets.
Environment &
Sustainability
Section, page 45
47
48
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Climate Related Risks and Opportunities
Driver
Description
Potential Impact Response to Risk/
Risk
Emerging
Regulation
An increase in carbon tax has
the potential to significantly
increase operating costs for
the business
Medium
Acute Physical
Disruption of activities due
to increased flooding
Medium
Medium
Medium
Reputation
Opportunity
Markets
Resource
efficiency
Markets
A failure to implement an
appropriate decarbonisation
strategy could impact
negatively in tender
processes, resulting in
the loss of business and
potentially the loss of
existing customers
Uniphar is well positioned
to develop new services
and solutions to ensure that
both our business and that
of our partners meet our
climate related requirements
and ambitions
Potential to increase energy
efficiency and to reduce
costs through reduced
consumption
The ability to demonstrate
meaningful progress on
climate-related issues
increases access to capital
from institutional investors
and fund managers
Opportunity
Supplier engagement
programme for third
party logistic providers.
Currently reviewing renewable
energy options as part of
decarbonisation planning
The operation of regional
depots mitigates the risk of
full operational outage due to
an individual weather event
During 2022, each division
prepared a decarbonisation
plan in respect of its business
Embedding climate-related
risks and opportunities into
the core business strategy
and formally commencing
a supplier engagement
programme
Low
Currently reviewing potential
solar panel installation
Medium
Setting clearly defined
environmental objectives,
including carbon reduction
targets, with transparent
disclosure on progress
towards those targets
Climate Scenario Analysis
In preparation for its CDP submission, the Group
conducted a transitional scenario analysis, using the
IEA NZE 2050 scenario, a scenario to bring global
energy-related carbon dioxide emissions to net zero by
2050 and give the world an even chance of limiting the
global temperature rise to 1.5 °C. This was a qualitative
analysis where we reviewed the policy milestones
from 2025 – 2050 using this scenario to identify if any
material risks or opportunities would arise. We identified
technology risks around transitioning to electric vehicles
and retrofitting existing buildings to zero‐carbon‐ready
levels. Electricity grid decarbonisation was identified as
a potential opportunity for Uniphar.
The Group also conducted a physical scenario analysis,
using the RCP 8.5 scenario. RCP 8.5 refers to the
concentration of carbon that delivers global warming at an
average of 8.5 watts per square metre across the planet.
The RCP 8.5 pathway delivers a temperature increase
of about 4.3˚C by 2100, relative to pre-industrial
temperatures. This was a qualitative analysis, where we
reviewed the high-level impacts in this scenario, to identify
if any material risks or opportunities would arise. In this
scenario, there is a possible risk for disruption to
activities, due to increased severe weather events and
damage to transport infrastructure. Rising sea levels pose
a risk to Group operations in the Netherlands, which is at
or below sea level. Water scarcity and loss of biodiversity
are potential risks for the Group in this scenario as they
could impact the production and supply of medicines.
Waste and Hazardous Waste Management
Across all our sites we are continuously exploring ways
to reduce, reuse and recycle. We have been a member
of Repak since 1999 and we make considerable efforts
across the business to reduce plastic waste. As part of
our overall Scope 3 emissions assessment, the Group
collated data from all locations across the business in
relation to waste. In 2022, 83% of the Group’s waste
(approximately 925 tonnes of waste) was diverted
from landfill.
Relevant parts of our business are compliant with the
Waste Electrical and Electronic Equipment Directive
(WEEE).
Pollution Prevention
The Group recognises the importance of protecting the
environment around us and ensuring that our operations
do not emit pollution into our surrounding environment.
During 2022, there were no reportable instances of
pollution across the Group.
Sustainable Transport
We are conscious that a significant portion of our carbon
footprint arises through outsourced activities such
as logistics and through our supply chain and we are
committed to working with our supply chain partners in
this area. During 2022, we appointed external consultants
to assist the Group in developing a programme for
supplier engagement, to ensure that the Group is working
closely with its suppliers and partners to reduce our
collective impact on the environment. The Group is
continuing to work on a Supplier Code of Conduct and
Responsible Sourcing Policy, which we expect to roll
out during 2023.
Across all our sites
we are continuously
exploring ways to
reduce, reuse and
recycle.
49
50
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Critical Incident Risk Management
Critical incident management requires
a coordinated response from multiple
teams to ensure that any critical
incidents (regardless of severity) are
appropriately managed. Our internal
reporting lines and focus on open
communication across divisions and
functions ensures that any critical
incident identified is managed
appropriately.
Legal and Regulatory Requirements
The Group appreciates the
importance of regulatory expertise
in navigating the ever-changing
regulatory environment in which
we operate. The Group’s General
Counsel heads the legal and
compliance function across the
Group with external legal and
regulatory support sought, where
necessary. Our extensive quality
teams specialise in healthcare
regulation and the requirements of
GDP and other regulatory codes
relevant to our business.
Appropriate training of our teams on
the applicable regulations in the areas
in which they work is essential to
maintaining the Group’s reputation for
quality and regulatory excellence.
Selling Practices and
Product Labelling
As a healthcare business engaged in
the sale, marketing and distribution
of pharmaceutical products and
medical devices, the Group is subject
to extensive regulation on Selling
Practices and Product Labelling
Regulations, together with industry
codes of practice, set down strict
requirements within which the Group
must operate and the Group’s quality
policies, manuals, extensive standard
operating procedures (SOPs),
and employee training programmes
are designed to ensure the Group
meets its obligations and ensures
compliance to the fullest extent.
The Group’s internal procedures
are the core of the Group’s Quality
Management System and it is
through these robust procedures and
ongoing training and development
that the Group continues to meet
the regulatory standards across all
our activities.
The Group is also required to comply
with standards relating to the
provision of information to healthcare
professionals (HCP), patients and
the public. The Group is committed
to enabling doctors and healthcare
professionals to offer their patients
the best possible therapeutic care
by providing them with complete,
accurate and up-to-date information
in accordance with the applicable
legislation on the promotion of
medicinal products.
GOVERNANCE,
QUALITY AND
COMPLIANCE
4
R
A
L
L
P
I
S
G
D
S
T
N
A
V
E
L
E
R
Adopting the highest standards of
Governance, Quality & Compliance
is essential to the success of our
business. The Board approved the
adoption of the UK Code as the
corporate governance code of the
Group in early 2022. The governance
of our business is dealt with in
extensive detail in the Corporate
Governance section of this report
on page 71.
Product Quality and Patient Safety
The healthcare industry is a highly
regulated industry, and this regulation
is essential to protect the health
and safety of people who use the
products and services we supply.
The Group is committed to ensuring
that the products we supply reach
the patient in perfect condition
and that we provide all services in
an ethical and compliant manner.
Through extensive training the Group
places a focus on a quality culture
and a strong understanding of quality
risk management. This allows us to
meet or exceed the requirements
and expectations of our customers
and partners.
Uniphar has a
robust digital quality
management
system (QMS) in
place, underpinned
by the core
GxP regulatory
requirements, which ensures
alignment and ongoing certification
with ISO 9001 2015.
This allows us to comply with the
many regulatory regimes, including
importation, storage, distribution of
products in accordance with EU GDP
Regulations as well as promotion of
and engagement with pharmaceutical
and medical device manufacturers in
an ethical and compliant manner.
The Group appointed a Global Head
of Quality in 2022 to oversee and
harmonise the quality functions
across each business in the
Group to ensure all businesses
are operating best-in-class quality
management systems.
Business Ethics
Uniphar is committed to promoting
a corporate culture that is based
on sound ethical values and
behaviours. The Group’s Code
of Conduct is an overview of our
responsibilities to each other and to
the many different constituencies
we serve – to our clients, customers,
principals and to the communities
where we live and work. It defines
business conduct standards for
everyone who works for us, in all
business areas, in every function,
geography and role. The Group is
continuing to develop its Supplier
Code of Conduct and Responsible
Sourcing Policy to outline our
expectations of our suppliers and
their responsibilities to us. The Group
also has a Whistleblower Policy
in place, establishing a structure
where behaviours which depart from
this ethical culture can be reported
whilst protecting the rights of the
whistleblower. This policy includes
an external reporting line.
Anti-bribery & Corruption
The Group has an Anti-Bribery
and Corruption Policy in place and
adopts a zero-tolerance approach to
all forms of bribery and corruption.
These standards are communicated
to, and expected of, all employees.
Human Rights
The Group is opposed to any form
of slavery and human trafficking and
conducts its business in line with the
UK Modern Slavery Act 2015 and
has a Modern Slavery Policy in place
which is available on the Group’s
website: www.uniphar.ie
Conflict of Interest
The Group is conscious that, at times,
the interests of our employees may
conflict with those of the Group or our
customers. The Group has a Conflict
of Interest policy in place which seeks
to manage or avoid ethical, legal,
financial or other conflicts of interest
and to ensure that the activities and
interests of our employees do not
conflict with their obligations to the
Group or its welfare.
Risk Management
Systemic Risk Management
The Group has a robust risk
management framework in place,
which provides the structure for
managing the principal risks of
the business. Details of this risk
management framework are detailed
on pages 27 to 34. In addition, the
quality and regulatory personnel
across the Group perform regular
risk assessments and have robust
validation processes in place.
51
52
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
BUSINESS
SOLUTIONS AND
INNOVATION
5
R
A
L
L
P
I
Business solutions and innovation is
something we are passionate about.
It underpins our ‘can-do’ culture and
entrepreneurial spirit and is central
to our organic growth. It is also a
key factor in identifying appropriate
M&A targets.
Business Resilience
Business resilience remained a key
focus during 2022, as businesses
globally were impacted by
macroeconomic and geopolitical
challenges across all markets.
The resilience and dedication of our
teams coupled with clear strategic
objectives and agility to adapt
traditional business models meant
the Group was well positioned to
continue to deliver for all of our
stakeholders. The Group’s diversity
in product portfolios and services
offerings, as well as our digital
capabilities were key to the Group’s
continued success during 2022.
S
G
D
S
T
N
A
V
E
L
E
R
The Group is embarking on a five
year digital transformation strategy,
which will include back-office
systems to support our expansion
and growth plans, as well as new
ways to engage our customers with
innovative digital solutions. We have
also commenced a cybersecurity
improvement programme, deploying
best-in-class security controls to
reduce risk and improve resilience.
The programme is enhancing the
detection of cyber threats, as well as
improving our ability to respond to
attacks and recover from incidents.
The programme is evolving in the face
of the shifting threat landscape to
address changing tactics, techniques,
and procedures.
Innovation
Uniphar prides itself on its innovative
and entrepreneurial culture. This is
evident in all areas of the business,
from implementing improvements in
existing systems, to identifying new
market opportunities, evaluating
acquisition targets, and enhancing
our digital capabilities.
The acquisitions completed in 2022
reflect the Group’s commitment
to delivering innovative solutions
for our customers. Each of the
acquisitions brings with them a
proven management team with
the entrepreneurial ambition to
innovatively solve problems by
viewing them from new perspectives.
Uniphar prides itself
on its innovative and
entrepreneurial culture
Commercial & Clinical
Read more on page 61
Product Access
Read more on page 63
Supply Chain & Retail
Read more on page 65
The Group’s diversity in
product portfolios and
services offerings, as well
as our digital capabilities
were key to the Group’s
continued success
during 2022.
In Supply Chain & Retail, our
multi-year investment in Greenogue
2 will deliver a flagship European site
that will transform how the division
operates, including a step-change
in automation, order line handling,
operational efficiency and digital
capability. We expect that this will
further differentiate our customer
offering and will help drive further
market share growth.
In Commercial & Clinical MedTech,
we are working with our partners to
bring innovative minimally invasive
surgery techniques (MIS), supported
with robotic technology, to market.
Examples of areas where we are
enabling MIS include laparoscopy,
orthopaedics and vascular surgery.
Product Access continues to support
manufacturers to bring new therapies
to patients using the latest science in
areas such as gene therapy.
Supply Chain Management
As set out above, a large proportion
of our carbon footprint derives from
our purchased goods and services.
As part of our commitment to setting
a science based target, we have
committed to a supplier engagement
target that 71% of our suppliers by
emissions covering purchased goods
and services, will have science-based
targets by 2028. In order to achieve
this target, we need to actively
engage with our suppliers to improve
data collection in our supply chain
and to work together to not only
set targets, but to find innovative
solutions to how we can collectively
reduce the impact of our supply
chain on the environment. The Group
is also working on implementing
a new Supplier Code of Conduct
and Responsible Sourcing Policy,
which the Group intends to roll out
during 2023.
53
54
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
PERFORMANCE REVIEW
Enabling
Healthcare
through
Technology
Financial Review
Commercial & Clinical
Product Access
Supply Chain & Retail
57
61
63
65
56
55
UNIPHAR PLC ANNUAL REPORT 2022 FINANCIAL REVIEW
2022 FINANCIAL HIGHLIGHTS
Investing for Sustainable
Growth across our Divisions
Tim Dolphin
Chief Financial Officer
Gross profit growth across each of our
divisions driving adjusted EPS growth of 13.2%.
A strong Balance Sheet with low leverage
and net bank debt positions the Group
well to execute its strategic objectives
18.4c
Adjusted EPS
(2021: 16.2c)
17.3%
Return on Capital Employed
(2021: 17.6%)
Gross Profit
€306.7m
50
Organic Gross
Profit Growth
5.7%
10
8
6
4
2
EBITDA
€98.0m
Net Bank Debt
€91.2m
100
80
60
40
20
2022: €306.7m
2021: €274.5m
0
2020
2021 2022
2022: 5.7%
2021: 8.5%
0
2020
2021 2022
2022: €98.0m
2021: €86.5m
2020
2021 2022
2022: €91.2m
2021: €48.3m
2020
0
2021 2022
ROCE
17.3%
20
15
10
5
2022: 17.3%
2021: 17.6%
0
2020
2021 2022
Basic Earnings
Per Share
16.7c
20
Adjusted Earnings
Per Share
18.4c
20
15
10
5
15
10
5
2022: 16.7c
2021: 17.8c
0
2020
Summary Financial Performance
Year ended 31 December
IFRS measures
Revenue
Gross profit
Operating profit
Basic EPS (cent)
Alternative performance measures
Gross profit margin
EBITDA
EBITDA %
Adjusted EPS (cent)
Net bank debt
Return on capital employed
2021 2022
2022: 18.4c
2021: 16.2c
0
2020
2021 2022
Growth
2022
€’000
2021
€’000
Reported
Constant
currency
6.6%
11.7%
17.7%
6.3%
10.8%
17.0%
13.4%
12.5%
2,070,669
1,943,149
306,744
53,155
16.7
14.8%
98,040
4.7%
18.4
(91,217)
17.3%
274,497
45,147
17.8
14.1%
86,481
4.5%
16.2
(48,297)
17.6%
Revenue
Revenue exceeded €2bn, increasing by 6.6% in the year (6.3% constant currency). The increase was evident across all
three divisions and further supported by acquisitions in each of the divisions, with a particularly strong performance in
the Supply Chain & Retail division.
Gross Profit
Gross profit growth of 11.7% (10.8% constant currency) was achieved in the year through a mix of 5.7% organic growth
and the contribution from 2022 acquisitions. Growth was achieved across each of the divisions, with a particularly
strong performance in the Supply Chain & Retail division, driven by strong market demand. The Commercial & Clinical
division’s result was driven by a strong demand for MedTech products coming out of the Covid-19 pandemic, while
Product Access delivered a solid performance in a market that is still recovering from the impacts of the pandemic.
Gross profit margin has increased from 14.1% to 14.8% reflecting a shift towards higher margin sectors and
businesses. In 2022, 32% (2021: 32%) of the Group’s gross profit was generated outside of Ireland, reflecting the
ongoing expansion of the Group’s Commercial & Clinical and Product Access divisions into new regions.
57
58
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Divisional gross profit
Year ended 31 December
Commercial & Clinical
Product Access
Supply Chain & Retail
2022
€’000
117,554
50,178
139,012
306,744
2021
€’000
104,398
41,318
128,781
274,497
Reported
12.6%
21.4%
7.9%
11.7%
Growth
Constant
Currency
11.5%
18.2%
7.9%
Organic
7.1%
7.0%
4.1%
5.7%
EBITDA
EBITDA increased by €11.6m to €98.0m. This represents growth of 13.4% in the year (constant currency 12.5%). 2022
saw unprecedented global inflationary challenges with the EBITDA growth reflecting not only organic gross profit growth
and the impact of recent acquisitions, but also strong cost management to ensure the business remains competitive.
Exceptional Items
Exceptional items in the year amounted to a charge of €3.2m before tax (2021: €5.4m credit). This includes costs of
€16.4m primarily comprising acquisition costs, redundancy and restructuring costs. This was offset by a release of
deferred contingent consideration of €12.1m, following a review of the expected performance against earn-out targets
and contractual obligations and €1.4m relating to a revision in discount rates, associated with deferred contingent
consideration to reflect the present value of the future contingent liabilities. In addition, there was the release of
re-financing costs relating to the 2020 banking facility of €0.3m. Further details can be found in Note 4 of the financial
statements.
Robust balance sheet
1.0x
Leverage
€91.2m
Net bank debt
Earnings per Share
Basic earnings per share reduced from 17.8 cent to 16.7 cent in 2022.The decrease is primarily as a result of an
increase in exceptional costs in 2022 when compared to 2021. The weighted average number of shares also marginally
increased in 2022, reflecting the full year impact of LTIP shares on which the performance conditions were satisfied.
Adjusted earnings per share is calculated after adjusting for amortisation of acquisition related intangibles and
exceptional costs. The Group’s adjusted earnings per share for 2022 was 18.4 cent (2021: 16.2 cent). Underlying
earnings have increased by 14.4% from €43.8m in 2021 to €50.1m in 2022. This was partially offset by a 1% increase
in the weighted average number of shares in issue compared to 2021.
Cash Flow and Net Bank Debt
The Group delivered a strong cash performance during the year, with a free cash flow conversion of 82.5% and a net
bank debt position of €91.2m (2021: €48.3m).
Year ended 31 December
Net cash inflow from operating activities
Net cash outflow from investing activities
Net cash inflow from financing activities
Foreign currency translation movement
Increase in cash and cash equivalents in the year
Movement in restricted cash
Non-cash movement in borrowings
Cash flow from movement in borrowings
Movement in net bank debt
59
2022
€’000
2021
€’000
82,831
(106,332)
50,405
(1,225)
25,679
–
14,423
(83,022)
(42,920)
52,177
(49,658)
13,259
1,837
17,615
(3,097)
350
(28,746)
(13,878)
The Group continues to maintain a strong focus on working capital management and this is reflected in the cash
generated from operating activities of €82.8m. Free cash flow conversion for the period was 82.5%, which exceeds
the medium-term free cash flow conversion target of 60-70%.
The net cash outflow from investing activities of €106.3m principally consisted of acquisitions completed during the
year of €67.2m (net of cash acquired), capital investment of €19.9m, deferred and deferred contingent consideration
payments of €9.3m and repayment of debt acquired on acquisition of €9.4m.
The net cash inflow from financing activities of €50.4m was due to a net increase in borrowings offset by principal lease
payments and the payment of dividends.
Debt Refinancing
The Group refinanced its debt facility in August 2022 and entered a new five-year arrangement (with two options
to extend by a further one year) which more than doubled the revolving credit facility to €400m with an additional
uncommitted accordion facility of €150m. Three new international banks, Barclays Bank, ING Bank and Citizens Bank
joined the existing syndicate, with a total of seven participating banks in the renewed facility. Net bank debt was €91.2m
(2021: €48.3m) at year-end and leverage remained low at 1.0x. The expanded facility combined with low leverage
provides the Group with the platform to support future growth and investment.
Taxation
The Group’s tax charge has increased by €1.3m to €9.0m driven largely by the growth in pre-exceptional profits of the
Group. The effective tax rate before exceptional items has increased from 16.8% to 17.4% reflective of the contribution
of profits from higher tax jurisdictions outside of Ireland. The effective tax rate is calculated as the pre-exceptional
income tax charge for the year as a percentage of the profit before tax and exceptional items.
Currency Exposure
The Group continues to expand into new geographies which, together with the continued growth in existing
geographies outside of the Eurozone results in a foreign exchange exposure for the Group being the translation of local
income statements and balance sheets into Euro for consolidation purposes.
On a constant currency basis, revenue increased by 6.3% vs 6.6% reported growth, gross profit increased 10.8% vs
11.7% reported growth and operating profit increased by 17.0% vs 17.7% reported growth.
GBP
US Dollar
Swedish Krona
2022
Average
0.852
1.051
10.623
2021
Average
0.860
1.182
10.145
Return on Capital Employed (ROCE)
Group ROCE in 2022 of 17.3% (2021: 17.6%) is slightly lower than prior year reflecting the impact of prior and
current year acquisitions as the Group continues to expand into new geographies and higher value businesses.
The investments made during 2022 are performing well and will deliver further benefits and growth in the coming years.
Details on how this was calculated are included in the APMs section on page 207 to 211.
Dividends
The Board remains committed to a progressive dividend policy as stated at the time of IPO. The Directors are proposing
a final dividend of €3.1m (€0.0113 per ordinary share), subject to approval at the Company’s AGM. It is proposed to pay
the dividend on 16 May 2023 to ordinary shareholders on the Company’s register at 5pm on 21 April 2023. Together with
the interim dividend of €1.7m (€0.0061 per ordinary share) paid in October 2022 this brings the total dividend for the
year to €4.8m (€0.0174 per ordinary share), representing an increase of 4.8% on 2021.
Tim Dolphin
Chief Financial Officer
60
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
COMMERCIAL
& CLINICAL
Commercial & Clinical
delivered a strong
performance in 2022
with organic gross
profit growth
of 7.1%
UNIPHAR PLC ANNUAL REPORT 2022
Innovative and
Digitally Enabled
Solutions
The Business
Commercial & Clinical provides outsourced sales, marketing, distribution
and consultancy solutions to pharmaceutical and medical device
manufacturers on a pan-European basis with a targeted service offering
in the US. The division is focused on the commercialisation of speciality
products to ensure that patients and their physicians are offered the
best treatments for their conditions. The division has two business units,
MedTech and Pharma, both of which are driven by the mission of ensuring
patients have access to the treatments they need when they need them.
Highlights
Commercial & Clinical delivered a strong performance in 2022 with organic
gross profit growth of 7.1% reinforcing our role as a trusted partner to
our clients and customers. The result in 2022 builds on strong growth in
the division in prior years. The acquisition of Inspired Health, a US-based
healthcare insights consultancy business enables the Pharma business
unit to evolve its commercialisation offering to enhance its clients’
competitiveness and improve healthcare delivery. The MedTech business
unit continues to focus on providing fully integrated solutions for our clients
who are bringing innovative medical technologies including robotic surgery
solutions to the market.
Key performance highlights include:
» Gross profit growth of 12.6% achieved across the division, of which
7.1% was organic. Both MedTech and Pharma delivering double
digit gross profit growth
» Gross profit generated from outside Ireland representing c.60%
»
of the divisional gross profit
Increase in the number of manufacturers represented in more
than one geography to 77 (2021: 67)
» Medical affairs capability established in nine markets across Europe
» Completion of the acquisition of Inspired Health which broadens
our service offering into market research and insights
MedTech
The Commercial & Clinical MedTech business unit offers a fully integrated
solution for our clients in sales, marketing and distribution of medical
devices across interventional cardiology/radiology, orthopaedics,
ophthalmology, minimally invasive surgery, diagnostic imaging and
critical care.
The strength of the MedTech business unit is in the diversity of our portfolio
across market leading and innovative brands and the depth of relationships
with customers and manufacturers.
2022
Organic gross
profit growth
7.1%
Number of countries
operating in
15
Gross profit generated
outside of Ireland (%)
c. 60%
61
Commercial & Clinical
Year ended 31 December
Revenue
Gross profit
Gross profit margin
2022
€’000
306,766
117,554
38.3%
2021
€’000
299,908
104,398
34.8%
Growth
Reported
2.3%
12.6%
350bps
Constant
Currency
1.4%
11.5%
The business continues to focus
on bringing the latest MedTech
innovation to customers with robotic
surgical technology being a focus
area in 2022. Robotic technology is
increasingly being recognised for its
precision and accuracy in surgery
that can result in improved patient
outcomes with resulting efficiencies
for healthcare providers. Our clients
rely on the expertise of our teams to
support them in transitioning to new
technologies and ensuring they are
achieving the optimum benefits from
the products we supply. Many of
our teams are clinically trained and
our clients trust these peer-to-peer
relationships when making
investment decisions.
Relationships are at the centre of
MedTech and the business focuses
on expanding relationships with
manufacturers across multiple
geographies. This drives the
geographic growth of the division
and the business is now active in
15 markets and we represent 77
manufacturers across more than
one geography (2021: 67). In late
2022, the division commenced
development of a US based facility
in North Carolina. Due to become
operational in mid-2023, the facility
will provide distribution and support
services to clients in the US.
Pharma
The Pharma business unit supports
pharmaceutical partners in driving the
commercialisation of their products
by leveraging data, insights and
marketing solutions to deliver
targeted omni-channel programmes.
The pharmaceutical industry is
dynamic and constantly changing as
manufacturers develop innovative
therapies and seek new methods of
commercialising them.
The Pharma industry has traditionally
focused on in-person engagement
with healthcare professionals
(HCPs) as the principal means of
communication. The Covid-19
pandemic forced a rapid rethink in
the sales and marketing strategies
of pharma companies as in-person
engagement was no longer possible.
Our Pharma business unit has
supported our clients with digital
engagement solutions in recent
years and it is now clear that the
future is a hybrid of digital and
in-person engagement. HCPs are
increasingly seeking information
that is customised to their interests,
delivered in a convenient medium
at a time of their choice rather than
through mass marketing.
Uniphar’s Pharma business unit has
built the capability in recent years to
support our clients in this changed
environment. Our BestMSLs business
offers expert medical information
condensed into short streaming
videos through The Doctors
Channel and hosts immersive three-
dimensional events online through
The Island platform.
The 2021 acquisition of E4H has
further enhanced our ability to deliver
targeted digital marketing content.
The Pharma business unit offers a
truly differentiated omni-channel
solution enabling clients to achieve
their commercialisation objectives.
The division continues
to focus on growing
our long-standing
manufacturer
relationships into
new geographies
We have also recently established
a medical affairs capability across
Europe with local expertise covering
Germany, Austria, Switzerland,
France, Belgium, Luxembourg, Italy,
Ireland and the UK, and near-term
plans to add Spain and Portugal.
This experienced team has launch
experience in Rare Disease,
Immunology, Oncology, Haematology,
Neurology, Vaccines and Paediatrics
and will support clients launching
therapies in European markets that
address unmet needs and deliver the
best quality of care for patients.
The acquisition of Inspired Health
in 2022 increases Uniphar’s
capability to offer market research
and commercialisation insights
to pharmaceutical and MedTech
manufacturers and further deepens
our presence in the strategically
important US market. Inspired Health
uses innovative market research
techniques to assist its clients
to better understand physicians,
patients, administrators and payors.
The acquisition enhances Uniphar’s
commercialisation offering to
clients and complements our recent
US acquisitions of BESTMSLs,
Diligent Health Solutions and
RRD International.
Outlook
The strong performance of the
Commercial & Clinical division
demonstrates the inherent strength of
its product offering and the diversity
of its portfolio. The division continues
to focus on growing our long-
standing manufacturer relationships
into new geographies. Innovation
plays an important role in the
continued growth of the division and
supporting the deployment of surgical
robotics will drive future growth in
MedTech while digital engagement
technologies and consultancy
services provide growth opportunities
in the Pharma business unit.
62
OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
PRODUCT
ACCESS
The Product Access
division achieved
gross profit growth
of 21.4% in the year
of which 7.0% was
organic growth.
UNIPHAR PLC ANNUAL REPORT 2022
Connecting
Medicines with
Patients Globally
The Business
The Product Access Division is focused on ensuring equitable access to
medicines for patients. We partner with manufacturers to provide global
reach and world class execution to get their medicines to the patients that
need them, with many of these being early stage, high tech or otherwise
difficult to source medicines. Our deep industry knowledge and experience
coupled with our digital capabilities enables us to navigate the complex
regulatory, logistical and clinical challenges to get medicines to wherever
they are needed around the world. The Product Access Division has two
business units, On Demand and Exclusive Access.
Highlights
Product Access delivered strong gross profit growth of 21.4% in 2022,
of which 7.0% was organic. The division made continued progress
across several strategic initiatives. The acquisitions of Orspec Pharma
and BModesto Group significantly broadens our geographic reach and
capability into continental Europe and Asia Pacific. In Exclusive Access,
wins in the US and in innovative areas such as cell and gene therapies
reinforce our market leading proposition.
Key performance highlights include:
21.4% gross profit growth achieved across the division
10 new Expanded Access Programs (EAPs) onboarded in the year
»
»
» A number of US EAPs awarded during 2022 representing a
significant milestone in the division’s expansion
» Completion of the acquisitions of Orspec Pharma and BModesto
Group significantly expanding our geographic reach and capability
On Demand
The On Demand business is a leading supplier of unlicensed and difficult
to source medicines to healthcare providers globally. The increase in the
geographic footprint of the business continued in 2022. The acquisition
of BModesto Group, which expands our reach in continental Europe,
the acquisition of Orspec Pharma providing access to the APAC markets,
in addition to the 2021 acquisition of Devonshire Healthcare Services which
gives us direct access to the MENA, provides a platform to continue the
global growth strategy. The business was well positioned to respond to the
global supply chain challenges experienced in 2022 that resulted in certain
medicines being in short supply. We worked across multiple geographies
and leveraged relationships with manufacturers to ensure continuity of
supply during 2022.
2022
Organic gross
profit growth
7.0%
Number of countries
operating in
160+
New EAPs awarded
in 2022
10 EAPs
63
Product Access
Year ended 31 December
Revenue
Gross profit
Gross profit margin
2022
€’000
206,868
50,178
24.3%
2021
€’000
157,152
41,318
26.3%
Growth
Reported
31.6%
21.4%
-200bps
Constant
Currency
30.0%
18.2%
The strength of our integrated
model is in our ability to leverage
relationships and infrastructure
in other business areas and for
other customers. The acquisitions
completed in the year offer
considerable cross-selling
opportunities with other business
areas. We see 2023 as a year of
continued development of our
On Demand and Exclusive Access
offerings with continued investment
in digital technology and scalable
infrastructure.
Our deep industry
knowledge and
experience enables
us to navigate the
complex regulatory,
logistical and clinical
challenges to get
medicines to wherever
they are needed
around the world.
BModesto Group will play an
important role in further scaling
our European presence and the
acquisition gives us a well-located
facility in the Netherlands from
which to supply mainland Europe.
The BModesto Group provides a
wide range of services including
the distribution of medicines on
both an exclusive and on-demand
basis, clinical trial services, market
authorisation holder and medical
device distribution. The acquisition
of Orspec Pharma, headquartered in
Australia, provides the Group with its
first physical presence in Asia Pacific.
Orspec Pharma specialises in the
supply of unlicensed medicines and
the delivery of EAP’s across the Asia
region from its locations in Australia,
New Zealand and Singapore.
Exclusive Access
Expanded Access Programs (EAPs)
are increasingly being seen as a
valuable step in the drug approval
and commercialisation process for
both manufacturers and patients.
Patients gain access to innovative
medicines that may not be available
to them through other routes
enabling better patient outcomes.
EAPs are used to obtain greater
knowledge and understanding
of the patient, the medicine and
the market while enabling the
manufacturer to refine and target
their commercialisation strategy.
Uniphar’s unique combination
of innovative technology, global
distribution capabilities and
passionate and experienced people
make us a compelling proposition
in global EAP delivery. The Uniphi
technology platform has been
developed in recent years and
combines patient enrolment with
personalised patient education.
The Exclusive Access business
unit has performed well during
2022 and builds on the momentum
achieved in prior years. Investments
in the division in recent years have
expanded the capabilities we offer
our clients and we have built a strong
reputation in therapeutic areas
such as Gene Therapy, Oncology,
Neurology, CAR T-cell Therapy
and Transplant.
Winning multiple US-based Expanded
Access Programs represents a
significant milestone in the division’s
continued geographic growth.
While the bulk of growth continues
to be from emerging and mid-
size biotech firms, the division
continues to focus on attracting
EAPs from innovators of all sizes,
as our reputation for operational
excellence and investment in scalable
infrastructure continues to grow in
the market.
Outlook
Covid-19 disruption over the last
three years has led to short-term
product development headwinds,
product launch deferrals and business
development interruption. While these
factors have been a challenge,
drug development pipelines remain
strong and will ultimately result
in additional opportunities for the
division in the medium term.
The division is targeting a return to
double digit organic growth in gross
profit in the second half of 2023.
Our recent acquisitions give us a
stronger and enlarged On Demand
business and also enhance the
attractiveness of our EAP offering
by expanding our global reach.
64
OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS SUPPLY CHAIN
& RETAIL
The Supply
Chain & Retail
division delivered
an outstanding
performance in
2022 with growth
achieved in both
volume and
market share.
2022
Organic gross
profit growth
4.1%
Market share
53%
Retail pharmacy
network
386 (Dec-22)
65
UNIPHAR PLC ANNUAL REPORT 2022
A Highly Efficient
Distribution and
Retail Business
The Business
The Supply Chain & Retail division ensures critical medications are
supplied to pharmacies and hospitals in Ireland every day through an
efficient, timely and secure supply chain. The Supply Chain & Retail division
comprises of our pre-wholesale and wholesale pharmaceutical distribution
business together with a vertically integrated retail offering. Our Retail
offering has c.1,850 community pharmacy customers of which 386 (prior
to the acquisition of McCauley Pharmacy Group) are owned, franchised
or supported pharmacies. Uniphar holds c.53% of the wholesale market
share and c.60% hospital market share and is an essential component of
the national health infrastructure in Ireland.
Highlights
The Supply Chain & Retail division delivered an outstanding performance in
2022 with growth achieved in both volume and market share. The proposed
acquisition of Navi Group, which was announced in 2021, will no longer
proceed to completion as it has not been cleared by the CCPC. Navi Group
has been a longstanding partner of Uniphar and both parties will continue
to work closely together to support our shared base of independent
community pharmacies. The acquisition of the McCauley Pharmacy Group,
completed in January 2023, further enhances our presence in the Irish
retail market.
Key performance highlights include:
»
7.9% growth in gross profit of which 4.1% is organic growth
» Commencement of development of our new state-of-the-art
distribution centre in Dublin
» Acquisition of the McCauley Pharmacy Group completed in
»
January 2023
7% growth in consumer product offering with our agency brands
and own brand performing strongly
Wholesale
The Wholesale business delivered a very strong performance in the year,
with the main business activity continuing to be centred around the
provision of prescription and OTC (Over the Counter) products to meet
the core demand from our pharmacy customers. Our consumer products
offering continued to grow with the ongoing expansion and development of
the range of products and brands available, which is an important element
in offering our customers a ‘one stop shop’ for all their pharmacy needs.
Shortages of medicines proved to be a challenge during 2022 across
Europe as manufacturers experienced supply chain disruption and
unprecedented inflationary pressures. Product shortages caused
operational challenges for wholesalers as safety stock levels reduced and
demand needed to be fairly allocated.
Supply Chain & Retail
Year ended 31 December
Revenue
Gross profit
Gross profit margin
Whilst we are dependent on
manufacturers for the supply of
product, our operational infrastructure
proved capable of rapidly delivering
product into the system as quickly
and fairly as possible.
During 2022, we commenced
investment in a new state-of-the-
art distribution facility in Dublin that
will double existing capacity levels.
This expanded capacity will enable
us to deliver on our Pharmacy of
the Future strategy and, together
with investment in innovative digital
solutions, will accelerate our ability
to support our customers to achieve
a fully connected pharmacy.
Pre-wholesale
Our pre-wholesale distribution
business is a trusted partner of key
principal manufacturers who benefit
from our innovative solutions tailored
to their business needs. Growth
was achieved in the year from a
combination of both underlying
market and business growth. We are
supporting our manufacturer partners
in navigating the ongoing Brexit
impacts such as new routes to
market. For products continuing to
be imported from the UK, we work in
partnership with the manufacturers
to ensure the relevant licences and
procedures are in place to ensure
the smooth flow of products.
The Supply Chain &
Retail Division offer
significant benefits
to the Group’s
overall capabilities.
2022
€’000
2021
€’000
1,557,035
1,486,089
139,012
8.9%
128,781
8.7%
Growth
Reported
4.8%
7.9%
20bps
Constant
Currency
4.8%
7.9%
A new four-year IPHA (Irish
Pharmaceutical Healthcare
Association) agreement came into
effect in 2022 and brought with it
market price changes across our
client manufacturer portfolios with
the growing penetration of biosimilar
products and specific manufacturer
products going off patent.
We enter 2023 in a strong position
with contract renewals completed
with a number of our long-standing
manufacturers and new business
opportunities being progressed with
some key client partners.
Retail
2022 has been a strong year for our
retail pharmacy business despite
inflationary challenges. Across our
three retail brands, the business has
enjoyed strong volume growth in
both dispensed items and consumer
retail with Over the Counter volume in
particular being exceptionally strong
during 2022.
One of the biggest challenges for the
sector as a whole has been staffing,
with pharmacists, technicians and
retail staff being difficult to recruit and
retain, with the consequential impact
on pharmacist locum costs being
a particular challenge. Despite this,
our retail stores continued to deliver
for their customers, supporting them
with courtesy, expertise and kindness.
In recognition of this tremendous
work within the community, all three
retail brands received a number of
national retail awards in 2022.
In September 2022, Uniphar
announced the acquisition of the
McCauley Pharmacy Group, with the
acquisition completing in January
2023. McCauley’s have been a close
partner of the Group for over 50
years and this strategic investment
will add 37 retail pharmacies to the
Uniphar network bringing with it a
market leading retail chain along
with a growing online business. The
McCauley Pharmacy Group is widely
regarded as a leading brand across
health, wellbeing and beauty, and
their expertise and advanced digital
offering will complement our fast-
growing consumer business in the
Supply Chain & Retail division.
Outlook
This division offers significant
benefits to the Group’s overall
capabilities through our high-
tech distribution facilities,
our scalable digital infrastructure,
our long-standing manufacturer
relationships and our highly skilled
people, who have deep insights
into the healthcare eco-system.
The acquisition of the McCauley
Pharmacy Group and the
development of our new Dublin
distribution facility will create the
platform and capacity for the division
to facilitate growth in the future.
While the division is present in Ireland
today, the Group continues to review
other markets where the successful
Irish model may be replicable.
66
OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS GOVERNANCE REPORT
Supporting
the Group’s
Sustainable
Success
Company Information
Board of Directors
Corporate Governance Statement
Corporate Governance Report
Audit, Risk and Compliance
Committee Report
Nominations, Governance and
Sustainability Committee Report
Remuneration Committee Report
Directors’ Report
68
69
71
72
81
87
91
104
COMPANY INFORMATION
AS AT 31 DECEMBER 2022
Board of Directors
M. Pratt (Chairman)
G. Rabbette (Chief Executive Officer)
T. Dolphin (Chief Financial Officer)
J. Berkowitz
J. Gaul
L. Hoctor
P. Hogan
S. Webb
Company Secretary
and Registered Office
A. McCarthy
Uniphar plc
4045 Kingswood Road
Citywest Business Park
Co. Dublin
D24 V06K
Registered Number
224324
Auditors
PricewaterhouseCoopers
Chartered Accountants and
Statutory Audit Firm
One Spencer Dock
North Wall Quay
Dublin 1
D01 X9R7
Legal Adviser
William Fry
2 Grand Canal Square
Dublin 2
D02 A342
Nomad and Euronext
Growth Adviser
Davy
Davy House
49 Dawson Street
Dublin 2
D02 PY05
Registrar
Computershare Investor Services
(Ireland) Limited
3100 Lake Drive
Citywest Business Campus
Dublin 24
D24 AK82
Principal Bankers
Bank of Ireland
Allied Irish Banks
Royal Bank of Canada
HSBC Bank
Barclays Bank
ING Bank
Citizens Bank
Joint Brokers
Davy
Davy House
49 Dawson Street
Dublin 2
D02 PY05
RBC Europe Limited
100 Bishopsgate
London
EC2N 4AA
Stifel Nicolaus Europe Limited
150 Cheapside
London
EC2V 6ET
Investor Relations
A. Smylie
Uniphar plc
4045 Kingswood Road
Citywest Business Park
Co. Dublin
D24 V06K
Website
Further information on Uniphar plc
is available on the Group’s website:
www.uniphar.ie
67
68
OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS BOARD OF DIRECTORS
Experience and Expertise
Experience
Maurice was appointed
Chairman in 2009, having
joined the Board as a Non-
Executive Director in July 2003.
Former Chief Executive Officer
of Tesco Ireland Limited and
C&C plc, Maurice is currently
Chairman of Nursing Homes
Ireland, Serious Fun Children’s
Network and B&B Ireland and
is a non-executive director of
Powerscourt Distillery Limited.
Principal Skills
Leadership, Strategy, Industry,
International Markets,
Governance, M&A
Experience
Tim joined Uniphar from
Topaz Energy Limited where
he was a member of the senior
management team. Prior to this,
Tim held various senior finance
positions with Royal Dutch Shell
plc in Ireland. He is a Chartered
Accountant by training and is a
director of the Pharmaceutical
Distributors Federation
Ireland CLG.
Principal Skills
Industry, Leadership, Strategy,
Finance, International Markets,
M&A
Ger Rabbette
Chief Executive Officer
Nationality: Irish
Appointed: March 2010
Independent: No
Committee Memberships
N
Paul Hogan
Non-Executive Director
Nationality: Irish/American
Appointed: June 2019
Independent: Yes
Committee Memberships
A N
Experience
An industry veteran, Ger joined
Uniphar from Celesio, where he
was Managing Director of
Movianto Ireland and Head of
Celesio Manufacturing Solutions
Ireland. He is a Chartered
Accountant by training and has
held a range of senior positions
in the healthcare sector with
Cahill May Roberts and the
wider Celesio Group.
Principal Skills
Industry, Leadership, Strategy,
Finance, International Markets,
M&A
Experience
A Chartered Accountant by
training, Paul was CFO of Brook
& Whittle Limited, a private
equity owned packaging group
headquartered in Connnecticut,
US until April 2022 and was
previously CFO at Nelipak
Healthcare and Director of
Development and CFO of the
Clondalkin Group. He trained
in Audit and Business Advisory
in PwC.
Principal Skills
Industry, Leadership, Strategy,
Finance, International Markets,
M&A
Maurice Pratt
Non-Executive Chairman
Nationality: Irish
Appointed: July 2003
Independent: No
Committee Memberships
N
Tim Dolphin
Chief Financial Officer
Nationality: Irish
Appointed: July 2010
Independent: No
Committee Memberships
N/A
Executive and
Non-Executive Directors:
Gender
Diversity:
Geographic Location
of Directors:
Board
Independence:
Non-Executive 75%
Executive 25%
Male 75%
Female 25%
Ireland 5
USA 2
UK 1
Independent 63%
Non-Independent 37%
(Chairman and Executive
Directors)
Experience
Jeff has extensive global
healthcare experience,
having held senior executive
positions at UnitedHealth
Group-Optum, Walgreens
Boots Alliance Inc. and
Merck & Co Inc. Jeff is CEO of
Real Endpoints LLC, and serves
on the Board of Directors of
H. Lundbeck A/S, Esperion
Therapeutics, Inc., and Zealand
Pharmaceuticals, Inc.
Principal Skills
Industry, Leadership, Strategy,
Legal & Regulatory,
International Markets,
Governance, M&A
Experience
Jim is a Certified Public
Accountant and former Chief
Financial Officer of Sanofi
Ireland & Mount Carmel Private
Hospital. He has a strong track
record in financial management
and global healthcare and is
a former director of Carraig
Insurance and Valeant
Pharmaceuticals Ireland.
He is currently a non-executive
director of a number of OPKO
Health subsidiaries.
Principal Skills
Industry, Leadership, Strategy,
Finance, International Markets
Experience
Aisling joined Uniphar in
May 2019 from William Fry,
where she spent 12 years
specialising in Corporate M&A
transactions and restructurings.
She is responsible for the
Group’s legal, company
secretarial, risk and compliance
functions and also Chairs the
Group’s Sustainability Council.
Experience
Sue held a variety of sales
and marketing roles at
Novartis Pharmaceuticals,
UK, Ltd, including Country
President, UK & Region Head
of Country Management,
Europe. Previously, Sue
worked for Ortho McNeil in
the US and Janssen-Cilag in
the UK, gaining significant
experience in pricing, strategy,
country re-organisation
and pharmaceutical
product launches.
Principal Skills
Industry, Leadership, Strategy,
International Markets, M&A
Experience
Liz is a qualified pharmacist
and former president of the
Irish Pharmacy Union (IPU).
With over twenty years’
experience advocating at both
political and administrative
levels of Government on behalf
of the pharmacy profession,
Liz has developed an in-depth
understanding of the Irish,
European and International
Healthcare Systems. Liz also
holds a Diploma in Corporate
Governance.
Principal Skills
Industry, Leadership,
International Markets,
Legal & Regulatory, Governance
Sue Webb
Non-Executive Director
Nationality: English
Appointed: June 2019
Independent: Yes
Committee Memberships
R A
Liz Hoctor
Non-Executive Director
Nationality: Irish
Appointed: January 2021
Independent: Yes
Committee Memberships
A
A Audit, Risk and Compliance Committee
Chair: Paul Hogan
See pages 81 to 86 for Committee Report
N Nominations, Governance and
Sustainability Committee
Chair: Jeff Berkowitz
See pages 87 to 90 for Committee Report
R Remuneration Committee
Chair: Sue Webb
See pages 91 to 103 for Committee Report
Chief Executive Officer
Ger Rabbette
See pages 15 to 18 for CEO Report
Jeff Berkowitz
Non-Executive Director
Nationality: American
Appointed: September 2020
Independent: Yes
Committee Memberships
N R
Jim Gaul
Non-Executive Director
Nationality: Irish
Appointed: January 2021
Independent: Yes
Committee Memberships
A N
Aisling McCarthy
General Counsel &
Company Secretary
Nationality: Irish
Appointed: May 2019
69
Executive and Non-Executive Directors:
Executive and Non-Executive Directors:
Executive and Non-Executive Directors:
25% Executive 75% Non-executive
25% Executive 75% Non-executive
25% Executive 75% Non-executive
Gender Diversity: 25%
Gender Diversity: 25%
Female 75% Male.
Female 75% Male.
Gender Diversity: 25%
Female 75% Male.
Geographic Locations:
Geographic Locations:
USA and 5 Ireland.
USA and 5 Ireland.
Geographic Locations:
1 UK, 2
USA and 5 Ireland.
1 UK, 2
1 UK, 2
63%
Board Independence:
Board Independence:
63%
Board Independence:
63%
Board Independence:
63%
Independent, 37% Non-Indepen-
Independent, 37% Non-Indepen-
Independent, 37% Non-Indepen-
Independent, 37% Non-Indepen-
dent (Chairman and Executive
dent (Chairman and Executive
dent (Chairman and Executive
dent (Chairman and Executive
Directors).
Directors).
Directors).
Directors).
1 UK, 2
Geographic Locations:
USA and 5 Ireland.
Gender Diversity: 25%
Female 75% Male.
Executive and Non-Executive Directors:
25% Executive 75% Non-executive
70
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
CORPORATE GOVERNANCE STATEMENT
CORPORATE GOVERNANCE REPORT
Dear Shareholder
On behalf of the Board, I am pleased to introduce the Group’s
Corporate Governance Report for 2022. This report outlines the
clear roles and structures we have in place for managing corporate
governance and seeking to ensure that the Group is positioned to
meet corporate governance standards at all times.
Looking ahead
As we look forward, in 2023 the
Board will continue to focus on
the strategic objectives of the
Group and each of the Group’s
divisions. Monitoring corporate
governance compliance and
performance against sustainability
targets will also be key objectives
for the Board. On finalisation of the
external board evaluation report,
the Board, in conjunction with the
Nominations, Governance and
Sustainability Committee will focus on
implementing the recommendations
of that report.
I look forward to continuing to work
closely with my fellow directors during
2023 and to ongoing engagement
with our shareholders to ensure
that we are continuing to meet their
expectations from both a strategic
and governance perspective.
We understand following that
engagement that the dissent was
primarily due to the issue of gender
diversity on the Board. In January
2023, the Board approved a target
to increase female representation
on the Board to 33% by the end
of 2023.
Another governance theme
arising out of the shareholder
engagement programme was
sustainability oversight at Board
level. In January 2023, the Board
approved the expansion of the remit
of the Nominations, Governance
and Sustainability Committee to
include sustainability oversight.
The Committee was renamed to
reflect its expanded remit.
External Board Evaluation
In late 2022, the Board appointed
Deloitte to undertake the Group’s
first external board evaluation since
IPO to identify areas of focus for
the future. To date, each Director
has responded to a formal board
evaluation questionnaire and
individual interviews have been
conducted with each Director.
The results of the board evaluation
are expected in early Q2, 2023 and
details of the recommendations of
that report will be included in the
2023 Annual Report.
Adoption of UK Corporate
Governance Code
2022 was another year of significant
progress for the Group’s corporate
governance agenda. The Board
resolved in early 2022 to adopt the
UK Code as the Group’s corporate
governance code and to align the
corporate governance practices of
the Group to that code. We remain
committed to maintaining the highest
standards of corporate governance
across the Group, to support the
delivery of our strategy and provide
long-term sustainable value to our
shareholders and other stakeholders.
Board Stability
Following significant changes to
Board and committee composition
since IPO, 2022 marked the first
year where there were no changes
to the Board. The Board welcomed
a period of stability during 2022
which saw a return to in-person
meetings, after two years of
Covid-19 restrictions.
Shareholder Engagement
Programme and Key
Governance Themes
At the Company’s 2022 AGM,
Resolution 3(e) (re-election of
Jeff Berkowitz) passed with a majority
of less than 80% (78.98% votes in
favour). Following this result and in
line with best practice, the Company
Secretary and I engaged with
shareholders who voted against
this resolution to better understand
and discuss the reasoning behind
their vote.
71
2) Provision 36 – The share options granted to Executive
Directors during 2022 are subject to a vesting period
of four years and two months and vesting of all
awards granted to Executive Directors will occur,
subject to achievement of the performance condition,
on 31 December 2026. The Board believes that,
notwithstanding this variance from the terms of the UK
Code, the scheme supports alignment with long-term
shareholder interests.
Board of Directors
The Board comprises of eight Directors, two of whom
are Executive Directors and six of whom, including the
Chairman, are Non-Executive Directors, reflecting a blend
of different experience and backgrounds. Of the Non-
Executive Directors, five members have been deemed
by the Board to be independent. Biographies of all of the
Directors are set out on pages 69 to 70.
The Directors acknowledge the importance of good
corporate governance and believe that it creates
shareholder value by improving performance, whilst
reducing or mitigating the risks that a company faces,
as it seeks to create sustainable growth over the medium
to long-term.
Since IPO in 2019, the Board has made significant
progress in bringing the Group’s corporate governance
regime in line with the requirements of the UK Code.
In January 2022, the Board resolved to adopt the UK
Code as its corporate governance code in line with
commitments made at the time of IPO.
The Group now complies with all provisions of the UK
Code, except:
1) Provision 19 – The Chair’s tenure exceeds nine years.
The Board believe that given the significant changes
to Board and Committee compositions in the past
3 years, Maurice Pratt has been instrumental in
maintaining a sense of stability and continuity through
this period of change and believe that he is best placed
to continue to lead the Board in the medium term.
The Nominations, Governance and Sustainability
Committee, together with the Senior Independent
Director, will take the findings of the external Board
evaluation into account in planning for the Chair’s
succession. Further details in relation to Chair
succession planning are set out on page 76.
Uniphar plc Board of Directors
Audit, Risk
and Compliance
Committee
Nominations,
Governance and
Sustainability Committee
Remuneration
Committee
Chair:
Paul Hogan
Chair:
Jeff Berkowitz
Chair:
Sue Webb
Chief
Executive
Officer
Ger Rabbette
Maurice Pratt
Chairman
See pages 81 to 86 for our
Committee Report
See pages 87 to 90 for our
Committee Report
See pages 91 to 103 for our
Committee Report
See pages 15 to 18 for our
CEO Report
72
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Committees
The Board is supported in its function
by the Audit, Risk and Compliance
Committee, the Nominations,
Governance and Sustainability
Committee and the Remuneration
Committee and Reports from each
of these Committees are contained
on pages 81 to 103.
A formal Schedule of Matters
Reserved for the Board is in
place and is reviewed annually.
Specific responsibilities reserved
for the Board include:
» Responsibility for the overall
leadership of the Group and setting
the Group’s values and standards;
» Approval of the Group’s purpose,
strategic aims and objectives;
» Promoting the long-term
sustainable success of the Group,
generating value for shareholders
and contributing to wider society;
» Embodying and promoting
a corporate culture that is
based on sound ethical values
and behaviours and using it
as an asset and a source of
competitive advantage;
» Undertaking an assessment of
the prospects of the Group, over
a defined period and determining
why it considers that period to
be appropriate;
» Ensuring maintenance of an
effective system of internal control
and risk management;
» Approving changes to the
structure, size and composition
of the Board, following
recommendations by the
Nominations, Governance and
Sustainability Committee;
» Undertaking a formal and rigorous
review of its own performance,
that of its Committees and
individual Directors, and the
division of responsibilities; and
» Considering the balance of
interests between shareholders,
employees, customers and
the community.
Non-Executive Directors
The Non-Executive Directors
contribute independent thinking and
judgement through the application
of their external experience
and knowledge, scrutinise the
performance of management,
provide constructive challenge to
the Executive Directors and ensure
that the Group is operating within
the governance and risk framework
approved by the Board.
Company Secretary
The Company Secretary is
responsible for providing a clear and
timely information flow to the Board
and its Committees and supports
the Board on matters of corporate
governance and risk. All Directors
have access to the advice and
services of the Company Secretary,
who is responsible to the Board for
ensuring that Board procedures are
complied with. The appointment and
removal of the Company Secretary
is a matter for the Board.
Senior Independent Director
Paul Hogan holds the position of
Senior Independent Director of
the Board. This role provides a
sounding board for the Chairman
and serves as an intermediary for
the other Non-Executive Directors,
when necessary. The Senior
Independent Director is also available
to shareholders if they have concerns.
The Board acknowledge the
important role the Senior Independent
Director plays in reviewing the
Chair’s performance annually and in
succession planning for the Chair,
particularly in circumstances where
the Chair has been determined not
to be independent.
Director for Workforce Engagement
Jim Gaul holds the position of
designated Director for Workforce
Engagement. In his role he liaises
with the HR teams on employee
engagement mechanisms, assesses
the output of workforce engagement
exercises and briefs the Board on
this engagement, ensuring that the
views and interests of employees are
considered by the Board.
Division of Responsibilities
The Board retains ultimate
accountability for good governance
and is responsible for monitoring
the activities of the executive
team. The Board has a collective
responsibility and legal obligation to
promote the interests of the Group
and is responsible for defining
corporate governance arrangements.
Ultimate responsibility for the quality
of, and approach to, corporate
governance lies with the Chairman.
The roles of Chairman and Chief
Executive Officer are not combined
and there is a clear division of
responsibilities between them. The
Chairman’s responsibility is to lead
the Board, and this ensures that the
Board is effective and efficient. The
Chief Executive Officer is accountable
to the Board for all authority
delegated to the executive team.
Chairman
The Chairman has overall
responsibility for corporate
governance throughout the Group.
He leads and chairs the Board,
ensuring that Committees are
properly structured and that they
operate with the appropriate terms
of reference. He ensures that all
Directors contribute effectively to the
development of the Group’s strategy
and consider the inherent risk included
in the implementation of the chosen
strategy. The Chairman is involved
in the development of strategy and
setting objectives, together with
the Chief Executive Officer and
oversees communication between
the Company and its shareholders.
Chief Executive Officer
The Chief Executive Officer provides
leadership and management for the
Group and leads the development
of objectives, strategies and
performance standards, as agreed by
the Board. He monitors, reviews and
manages key risks and strategies with
the Board, and ensures that the assets
of the Group are maintained and
safeguarded. He also takes a leading
role on investor relations activities
to ensure that communications
and the Company’s standing
with shareholders and financial
institutions are maintained. The Board
has delegated responsibility for
the management of the Group,
through the Chief Executive Officer,
to the executive team.
73
During 2022, the key matters considered by the Board included:
Strategy & Management
» Two-day Board Strategy Event
Financial Reporting & Compliance
» Interim and Final results
(May 2022)
announcements
» Approval of Acquisitions
» Annual Report and Consolidated
during 2022
» Orspec Pharma (Australia)
» BModesto Group
(Netherlands)
» McCauley Pharmacy Group
(Ireland)
» Inspired Health (US)
Financial Statements
» Interim and final dividends
» Annual Budget and 5 Year Plan
» Updates to Group Policies
» Compliance Review
Corporate Governance and
Stakeholder Engagement
» Adoption of UK Code
» Expansion of remit of Nominations
& Governance Committee to include
Sustainability oversight
» AGM voting results and proxy
advisor recommendations
» Shareholder Engagement
Programme
» Appointment of Deloitte to conduct
External Board Evaluation
» Strategic investments in new
distribution facility and digital
transformation
» Bank refinancing
Risk & Internal Controls
» Approval of Risk Management
Policy, Risk Register and Risk
Appetite Statement
» Consideration of climate-related
risks and their potential impact
on the business
» Cyber Security Review
» Updates from Audit, Risk
and Compliance Committee
on internal controls and
audit process
Appointment of Directors
The Board has a formal Board
Appointments Policy in place
which sets out the procedure
and criteria to be applied when
considering the appointment of new
individuals to the Board. As part of
this procedure, the Nominations,
Governance and Sustainability
Committee evaluates the balance
of skills, experience, independence,
diversity and knowledge currently
on the Board. There were no new
appointments to the Board during
2022 and the external Board
Evaluation currently being conducted
will assist in identifying any gaps
in skills, experience, diversity or
knowledge on the Board to drive
future appointments.
Remuneration
» Approval of Remuneration Policy
Sustainability/ESG
» Climate reporting and Interim
for Executive Directors
» Adoption of new share
option scheme
Conflicts of Interest
The Group has a Conflicts of Interest
Policy in place which provides that
where incoming or existing Directors
retain or accept new appointments
with other companies including
related companies, this should be
fully disclosed to the Company
Secretary and the Chairman for
approval, to ensure that any conflicts
of interests are identified in a timely
manner. Before accepting any outside
directorship, a Director must engage
with and seek approval of the Chair
and the Company Secretary.
Re-election of Directors
During 2022, the Articles were
amended to provide that, in line
with the UK Code, all Directors
must retire annually and, if eligible,
present themselves for re-election
to the Board. At the 2022 AGM all
Directors voluntarily put themselves
forward for re-election to the
Board and each was re-elected by
the shareholders.
emissions targets
» CDP Response 2022
» Board Sustainability training
» Group’s external
Sustainability ratings
» Launch of Employee Resource
Groups – Women’s Alliance and
Rainbow Alliance
The Board is cognisant that while
our Chairman is the longest serving
member of our Board, the UK Code
allows some flexibility in relation to
Chair tenure, to facilitate effective
succession planning and the
development of a diverse Board.
The Board is also cognisant of
the number of changes to Board
composition and Committee
composition over the last three years.
Since IPO, Mr. Pratt has been put
forward for re-election at each AGM
and has received overwhelming
shareholder support.
Further details in relation to Chair
succession planning are contained
on page 76.
74
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS skills
8
7
6
5
4
3
2
1
0
Experience and skills of the Non-Executive Directors
Industry
Leadership
International Markets
Strategy
Mergers & Acquisitions
Finance
Governance
Legal & Regulatory
8
8
8
7
6
4
3
2
Induction, Development and Training
The Directors believe that the Board
has significant industry, financial,
strategic and governance experience,
possessing the necessary mix of
experience, skills, personal qualities,
and capabilities to deliver the
strategy of the Group for the benefit
of shareholders over the medium
to long-term. The skills of each of
our Directors are highlighted in the
Director biographies on pages 69
to 70 and the skills matrix above.
The Board notes that certain
shareholders and proxy advisors have
highlighted the importance of cyber
security and sustainability experience
at Board level. In assessing the
skills of the members of the Board,
the Board has not identified any
Director with specific skills or
experience in the areas of cyber
security or sustainability. However,
in 2021 the Group appointed a Chief
Technology Officer who provides
regular updates to the Board on the
topics of cyber security and digital
transformation. Externally facilitated
cyber security training is also on the
Board agenda for 2023. As cyber
security has also been identified as
a key business risk, the assessment,
monitoring and mitigation of that
risk is a matter currently under
the remit of the Audit, Risk and
Compliance Committee.
In the area of sustainability, the Board
has recently expanded the remit of
the Nominations, Governance and
Sustainability Committee to include
sustainability oversight and in January
2023 the full Board received training
provided by external consultants on
this topic.
The Board is kept abreast of key
developments regarding corporate
governance and AIM and Euronext
Growth regulation by its Nominated
Adviser and Euronext Growth Adviser,
and its legal advisers.
The Company’s legal advisers
provide updates on relevant legal
and governance issues with the
Nominated Adviser and Euronext
Growth Adviser providing the Board
with training on the AIM Rules and
Euronext Growth Rules (as applicable)
and refresher training as and when
required. The Company Secretary
also helps to keep the Board up
to date on corporate governance
developments and liaises with the
Nominated Adviser and Euronext
Growth Adviser on areas of AIM and
Euronext Growth Rules requirements.
The Directors have access to the
Nominated Adviser and Euronext
Growth Adviser, the Company
Secretary, lawyers, and auditors as
and when required and are able to
obtain advice from other external
bodies, when necessary.
The Board also has a formal Board
induction procedure in place.
When new Directors join the Board,
they are provided with extensive
briefing materials on the Group and
its operations, as well as training,
where appropriate.
Board Evaluation
The Board believes that, in addition
to dealing with any matters as
they arise, it is appropriate to carry
out a formal evaluation of the
performance of the Board each
year. This is intended to ensure
that the Board remains effective,
well-informed, and able to make
high quality and timely decisions
for the benefit of all stakeholders
75
of the Group. The Chairman is
responsible for overseeing the
annual evaluation process.
The Group’s Annual Performance
Evaluation Procedure includes an
evaluation of:
» The composition and structure
of the Board, to include the
balance of skills, experience and
knowledge on the Board
» The Board’s diversity, to include
gender, social and ethnic
backgrounds, and cognitive and
personal strengths
» The independence of the Board
and individual Directors
» How the Board works together as
a unit to achieve objectives and
fulfil responsibilities
» How the Board discharges its roles
and responsibilities
» Board processes, to include
effectiveness of meetings,
agendas, forward planning
and reporting
» The Chairman’s leadership style
and approach
» The performance of Committees
» The performance and ability
of individual Directors’ to
contribute effectively and their
ongoing commitment to their
role as Director and, if relevant,
Committee membership
In November 2022, in line with the
requirements of the UK Code, the
Board appointed Deloitte to conduct
an external Board evaluation. Prior
to the Company’s IPO in 2019,
Deloitte conducted a review of
board composition and developed
a roadmap for the Company to
meet UK Code compliance within
three years of IPO. The Board
has since implemented those
recommendations and over the past
three years has transformed Board
and Committee composition in line
with the requirements of the UK
Code. Deloitte were not involved
in the implementation of the 2019
recommendations. Deloitte also
provide application management IT
support services to the Group since
2013. The Board believes, based on
Deloitte’s experience in the market
and understanding of Uniphar, that
they are well placed to review the
current Board and its effectiveness.
The external board evaluation
includes a review of a broad variety
of Board materials and policies,
a Director questionnaire, individual
Director interviews and attendance
at a Board meeting of the Company.
Some particular areas of focus for
that review are:
» Role of the Board
» Board Composition
» Succession Planning
» Chair Leadership
» Board Planning
At the time of writing the external
Board evaluation report is currently
being compiled and the outcomes
and actions taken will be included
in the 2023 Annual Report. The
Nominations, Governance and
Sustainability Committee will use the
report and the feedback obtained
from shareholder engagement to
inform Board succession planning, in
the short and medium-term as well as
other Board governance matters.
The Non-Executive Directors
also met with the Chair during
2022, without Executive Directors
present and discussed a wide
range of issues, including those
considered by the various standing
Board Committees. In addition,
the Non-Executive Directors, led by
Paul Hogan as Senior Independent
Director, met without the Chair
present in December 2022, to
review the performance of the Chair
during the year.
Board Succession Planning
The Board plans for its own
succession with the assistance of
the Nominations, Governance and
Sustainability Committee and has
prepared a succession plan to ensure
that the Board has continuity of
relevant skills and independence in
the future. In doing this, the Board
considers the skill, knowledge and
experience necessary to enable
it to meet the strategic vision for
the Group.
Diversity, to include gender, social
and ethnic backgrounds, and
cognitive and personal strengths,
is also a key feature for the Board
in succession planning, particularly
in light of the views expressed
by shareholders, as part of the
shareholder engagement programme.
The results of the external board
evaluation will also inform future
succession planning priorities.
Chair Succession
One area in which the Company is
not currently in line with the UK Code
relates to Chair tenure. The Board are
aware that where the tenure of the
Chair exceeds the recommendations
of the UK Code a clear explanation for
this should be provided. Since IPO,
Mr Pratt has been put forward for
re-election at each AGM and has
received overwhelming shareholder
support. As Chair, Mr. Pratt continues
to demonstrate strong and ethical
leadership while fostering a
productive and working relationship
Attendance at Board and Board Committee meetings in 2022
Board
11/11
11/11
11/11
11/11
11/11
9/11
11/11
11/11
Director
M. Pratt
G. Rabbette
T. Dolphin
P. Hogan
S. Webb
J. Berkowitz
J. Gaul
L. Hoctor
Audit, Risk
and
Compliance
Committee
Nominations,
Governance
and
Sustainability
Committee
Remuneration
Committee
–
–
–
8/8
8/8
–
8/8
8/8
1/1
1/1
–
1/1
–
1/1
1/1
–
–
–
–
–
4/4
4/4
–
–
Number of meetings attended during the period/ Number of meetings held during
the period
with the Executive Directors.
His extensive experience enables him
to move the Board through agenda
items effectively while encouraging
all Board members to engage in
Board discussions, fostering an open
Board culture both inside and outside
the organisation. Previous internal
board evaluations have also credited
Mr. Pratt with representing the
interests of the Non-Executive
Directors very effectively.
Whilst Mr. Pratt’s tenure exceeds
the recommendations set out in
the UK Code, the Board believe
that the appointment of a Senior
Independent Director and an
externally facilitated board evaluation
mitigate, in the short term, any impact
of non-independence or long tenure
of the Chair.
Throughout his tenure, Mr. Pratt
has supported the Board and the
Executive Leadership Team in their
delivery of many key milestones
and achievements and has led the
Board through enormous challenges
and successes. The Company has
seen significant change in Board and
Committee composition since the
Company’s IPO in 2019. The Board
believe that in the interests of
maintaining stability at a time of
significant growth and transformation,
continuity in the position of Chair
is important not only for the Group
but also for shareholders and other
stakeholders. As Chair leadership is
a topic being assessed as part of the
Board’s external evaluation, following
completion of that evaluation,
the Nominations, Governance
and Sustainability Committee will,
together with the Senior Independent
Director, assess the succession
plan for the Chair and will disclose
proposals in that regard in the
Company’s Annual Report for 2023.
Independence
Of the existing Non-Executive
Directors, the Board has determined
that Paul Hogan, Sue Webb,
Jeff Berkowitz, Jim Gaul and
Liz Hoctor are independent in
character and judgement and
that there are no relationships or
circumstances which could materially
affect or interfere with the exercise
of their independent judgement.
Maurice Pratt is not deemed to be
independent, as a result of his tenure
on the Board.
76
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Time Commitment
Each Board member commits
sufficient time to fulfil their duties
and obligations to the Board and
the Group. Expectations in terms
of time commitment are clearly set
out in the terms of appointment of
all Non-Executive Directors and
the Board are satisfied that each
Director is committing sufficient
time to discharge their duties to
the Company and its shareholders
effectively.
There were eleven formal meetings
of the Board during 2022. Details of
Directors’ attendance at those
meetings are set out in the preceding
table. The Chairman sets the agenda
for each meeting, in consultation with
the Chief Executive Officer and the
Company Secretary. Board papers
are circulated to Directors in advance
of meetings.
Board Committees
The Board has three permanent
Committees to assist in the execution
of its responsibilities. These are
the Audit, Risk and Compliance
Committee, the Nominations,
Governance and Sustainability
Committee and the Remuneration
Committee. Ad hoc committees are
formed from time to time to deal with
specific matters.
Each of the permanent Committees
has terms of reference under which
authority is delegated to them by
the Board and copies of the terms
of reference of each Committee are
available on the Company’s website
www.uniphar.ie. The Chair of each
Committee reports to the Board on its
deliberations, attends the AGM and
is available to answer questions from
shareholders throughout the year.
The composition of each of the
committees is in line with the UK
Code. The current membership
of each Committee, details of
attendance, each member’s tenure,
and the roles and responsibilities of
each Committee are set out in the
individual Committee reports on
pages 81 to 103.
Audit, Risk and
Compliance Committee
The Audit, Risk and Compliance
Committee consists of four
Non-Executive Directors: Paul Hogan,
Sue Webb, Jim Gaul and Liz Hoctor.
Paul Hogan is Chair of this
Committee and is considered by the
Board to be independent. Paul Hogan
and Jim Gaul also have extensive
financial experience and expertise.
It can be seen from the Directors’
biographical details appearing on
pages 69 to 70 that the members
of the Committee bring to it a wide
range of experience and expertise.
The Committee met eight times
during 2022.
The Chief Financial Officer, and senior
members of the Group Finance team,
normally attend meetings of the
Committee while the Chief Executive
Officer attends when necessary.
The external auditors attend as
required and have direct access to
the Committee Chair at all times.
During the year, the Committee met
with the external auditors without
management being present.
Nominations, Governance and
Sustainability Committee
The Nominations, Governance and
Sustainability Committee consists of
the Chairman, the Chief Executive
Officer and three Non-Executive
Directors: Jeff Berkowitz, Paul Hogan
and Jim Gaul. Jeff Berkowitz is Chair
of this Committee and is considered
by the Board to be independent.
The Committee assists the Board
in ensuring that the composition
of the Board and its Committees
is appropriate to the needs of
the Group.
In early 2023, the terms of
reference of this Committee were
expanded to include oversight
of sustainability matters and the
Committee was renamed as the
Nominations, Governance and
Sustainability Committee.
In discharging its responsibilities,
the Committee uses the services of
independent consultants, as required.
Remuneration Committee
The Remuneration Committee
consists of two Independent
Non-Executive Directors:
Sue Webb and Jeff Berkowitz.
Sue Webb is Chair of this Committee
and is considered by the Board to
be independent.
The Committee receives advice from
leading independent compensation
and benefits consultants
when necessary.
Stakeholder Engagement
The Company has established
a framework for stakeholder
engagement which identifies the key
stakeholders of the Group and sets
out the mechanisms for engaging and
communicating with them and details
key responsibilities. See page 78.
Communications with Shareholders
The Board is committed to engaging
with the international financial
community and shareholders on a
regular basis. A dedicated investor
relations function is in place,
focused on continuing to increase
awareness of Uniphar across the
international financial community and
the Group has an investor relations
policy in place to:
» Outline the Company’s methods of
communication with shareholders
» Ensure that the Company
communicates effectively with all
shareholders
» Ensure that the Company
discloses information correctly,
in a balanced, transparent and
timely way and simultaneously
to shareholders
During 2022, the Company
conducted more than 190 meetings
and conference calls across over 120
existing and prospective investors.
A summary of key conferences is
included on page 79.
The Group’s focus on investor
relations and the growing interest
from equity market participants
is evidenced by the growing pool
of independent equity analysts
providing research coverage on the
Group. Engaging with the analyst
community is a key part of how
Uniphar communicates with the
capital markets. During the year,
Uniphar carried out over forty calls
with analysts providing market
updates and ongoing Company
education. Seven independent
research analysts now provide equity
research on the Group.
Stakeholder
Shareholders
Employees
Customers/Suppliers
Advisers
Regulators
How we Engage with Stakeholders
The Group believes that understanding and meeting shareholder needs and expectations
is a key business objective in and of itself. The Group has an active investor relations
programme and details of shareholder engagement and other communications with
shareholders during 2022 are set out in greater detail in this report.
With a workforce of over 2,800 communication is a key priority for the Group. The Group
recognises that an essential part of its continued success is the support and involvement
of its employees. Given the diverse range of functions throughout the Group, there is no
‘one size fits all’ approach to employee engagement and communication. The Group also
recognises the trade unions of which some of its employees are members and engages
with them as necessary. Jim Gaul was appointed designated Non-Executive Director for
workforce engagement in 2021. Further details of workforce engagement during 2022 are
set out in this report.
Customer and supplier satisfaction is key to the business of the Group and therefore the
Group must continually engage with its customers and suppliers to ensure satisfaction
and achievement of KPIs. The method of communication depends on the nature of the
relationship and the effectiveness of the communication strategy is kept under constant
review by the Group.
The Group has a number of long-standing and trusted advisers in addition to new
engagements on an as-needed basis. Open communication between the Group and its
advisers ensures expectations are managed and optimum service levels are achieved.
Where appropriate, the Group encourages communication between its advisers to ensure
a cohesive approach.
The Group takes its obligations to make notifications, filings and returns to various
Regulators seriously and seeks to ensure prompt, effective and transparent
communication with its Regulators.
Press/Media/Public
The Group engages the services of a public relations consultancy to handle its media and
press communication and the Group Head of Strategy and Investor Relations also plays a
key role in communicating with this important stakeholder.
Additionally, shareholders are kept
up-to-date on matters of a material
substance and/or a regulatory
nature, including M&A activity,
where relevant, via announcements
made through the regulatory news
service. On a day-to-day basis,
the Group welcomes ad-hoc queries
directly via telephone, post or email.
Up to date details and a variety of
information that may be of interest
to shareholders is available on the
Group’s website: www.uniphar.ie.
The Chair, the Senior Independent
Director and the Chairs of each Board
Committee, are also available to
investors to discuss matters relating
to their respective roles.
The Board is kept up-to-date with
the views of the shareholders through
regular updates from the investor
relations and company secretarial
team, following engagement with
shareholders. The Board also receives
briefings from the Group’s brokers
on topics such as market perception,
investor feedback, the development
of our share register, as well as
regulatory topics.
The Board views the Annual Report,
as well as its Interim Results, as key
communication channels through
which progress in meeting the
Group’s objectives and updating its
strategic targets can be given to all
shareholders. The Company’s AGM
is an opportunity for shareholders to
meet with the Chairman and other
members of the Board. The meeting
is open to all shareholders, giving
them the opportunity to ask questions
and raise issues during the meeting
or, more informally, following
the meeting.
The results of the Company’s AGM
are announced via the regulatory
news service. In 2022, the Company’s
AGM took place in-person for the first
time since Covid-19 and was also
transmitted via conference call.
The Company has also
implemented a ‘Significant Votes
Against a Resolution Procedure’
which ensures that where 20% or
more of votes have been cast against
the Board’s recommendation for
a resolution at a general meeting
of shareholders, the Board will
engage with shareholders and seek to
understand their views in relation to
the significant vote against. Following
the 2022 AGM result, the Company
acknowledged that the voting results
in respect of Resolution 3(e) (re-
election of Jeff Berkowitz) passed
with a majority of less than 80%
(78.98% votes in favour). In line with
the requirements of Provision 4 of
the UK Code and the Company’s
policy, the Company commenced a
shareholder engagement programme
which saw the Company’s Chairman
and Company Secretary engage
with shareholders who voted against
this resolution, in order to better
understand and discuss the reasoning
behind their vote. The Board
understands that the dissent was
primarily due to gender diversity on
the Board. The proposed steps to
increase female representation on the
Board are set out in the Nominations,
Governance and Sustainability
Committee Report on page 89.
77
78
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Key Conferences 2022
Compliance with Section 172 U.K. Companies Act 2006
Date
January 2022
March 2022
March 2022
March 2022
March 2022
May 2022
September 2022
September 2022
November 2022
November 2022
November 2022
November 2022
November 2022
Activity
Davy/Peel Hunt Conference (Virtual)
Full-year Results & Roadshow
Davy/Peel Hunt UK & Ireland Equity Ideas Conference (Virtual)
Goodbody Conference (Ireland)
Berenberg Conference (UK)
Berenberg Conference (US)
Interim Results & Roadshow
Sweden Investor Roadshow (Stockholm)
Investec UK Opportunities Conference (UK)
Jefferies Healthcare Conference (UK)
Goodbody Conference (Ireland)
US Roadshow (Chicago, Boston, New York)
Stifel Conference (New York)
Workforce Engagement
Jim Gaul is the Board’s designated
Non-Executive Director for workforce
engagement. The Board believes
that having a designated workforce
engagement role at Board level,
increases representation of the views
of our workforce at Board level.
Jim Gaul’s responsibilities,
as designated workforce engagement
Non-Executive Director include:
» Liaising with the HR teams
Following on from the future of
work engagement programme,
launched in 2021, the Group
engaged with employees on the
topic of ED&I through a survey in
relation to the establishment of
the Group’s employee resource
groups – the Women’s Alliance and
the Rainbow Alliance and employee
preferences in relation to these
initiatives. The Group also engaged
with employees in relevant parts of
the business on the topic of gender
pay gap reporting.
In addition, the Group also held
its first leadership conference in
November 2022, where 180 of
the Group’s leaders were brought
together for two days to discuss
the future vision for the business.
Over the course of the two days,
leaders were asked to suggest
what management could change
at Uniphar to unlock the business
growth ambition.
on the employee engagement
mechanisms in place across the
Group to ensure that they are
effective and remain relevant over
time and developing a plan for
formal workforce engagement
» Assessing the output of workforce
engagement exercises to identify
issues and trends arising and
working with the HR teams to
implement a plan to address any
such issues and trends
» Briefing the Board regularly on
proposals for future workforce
engagement and the outcomes
from any engagement undertaken
» Ensuring that the views and
interests of employees are
considered by the Board.
Compliance with Section 172 U.K.
Companies Act 2006
The UK Code provides that
while considering the views of
shareholders, the Board should
also understand the views of the
Company’s other key stakeholders
and describe how their interests and
the matters set out in Section 172 of
the UK Companies Act 2006 have
been considered in Board discussions
and decision-making. While Section
172 is a provision of UK company
law, and there is no direct comparator
in the Irish Companies Act 2014,
the Board believes that, as a
company listed on AIM in the UK,
with significant business operations
there and in the spirit of compliance
with the UK Code, it is important to
address these provisions.
The Directors are confident that they
have acted to promote the success
of the Company for the benefit of
shareholders, whilst having regard to
provisions (a) to (f) of Section 172.
Section 172 Matters
How the Board had regard to these Matters
(a) The likely consequences of any
decision in the long-term
(b) The interests of the
Company’s employees
» Strategic planning
» Budgets and forecasting
» Sustainability Metrics
» ROCE
» Designated Workforce Engagement
Non-Executive Director
» Employee polls
(c) The need to foster the Company’s
business relationships with
suppliers, customers and others
» Strategic planning
» Business Model considerations
» Divisional updates
(d) The impact of the Company’s
» Integrating Sustainability into
operations on the community and
the environment
Strategy discussions
» Regular Sustainability Council updates
(e) The desirability of the Company
maintaining a reputation for high
standards of business
to Board
» Targets and metrics to monitor
performance against KPI
» Unity for Hope and community
involvement initiatives
» Whistleblower Policy including external
reporting line
» Group-wide Code of Conduct
» Group-wide ED&I Policy
» Modern Slavery Policy
» Anti-bribery and Corruption Policy
Relevant Annual Report
Section
Strategic Review pages
14 to 54.
People & Culture pages 25
to 26.
Sustainability and
Governance page 36 to 54.
Our Strategy pages 19 to 20.
Business Model page 21
to 22.
Performance Review pages
56 to 66.
Sustainability and
Governance Report pages
36 to 54.
People & Culture page 25
to 26.
Corporate Governance
Report page 72 to 80.
(f) The need to act fairly between
members of the Company
» Extensive Investor Relations Programme
» 20% Votes Against Policy
Corporate Governance
Report page 72 to 80.
During 2022, the Board received
regular updates on a number
of initiatives designed to build
solid foundations for the future.
Further details on culture at Uniphar
during 2022, are set out in the People
& Culture section on page 25.
Internal Control and Risk
Management
The Directors have overall
responsibility for the Group’s system
of internal control and for reviewing
its effectiveness. This system is
designed to help the Group meet its
business objectives, by appropriately
managing, rather than eliminating,
the risks to those objectives.
Through the activities of the Audit,
Risk and Compliance Committee,
the effectiveness of these internal
controls is regularly reviewed.
The Group’s Risk Management Policy
is designed to provide the framework
to identify, assess, monitor, and
manage the risks associated with the
Group’s business. Further details on
the Group’s material risks and risk
management framework are set out
on pages 27 to 34.
Culture
2022 saw a continued focus
on culture and values at Board
discussions. The ‘can-do’ culture
across the Group remained evident
throughout the year as the teams
continued to pull together to meet
client and customer needs.
The Schedule of Matters Reserved for
the Board includes obligations on the
Board to:
» Embody and promote a corporate
culture that is based on sound
ethical values and behaviours and
use it as an asset and a source
of competitive advantage
» Establish a framework for
setting, promoting, monitoring,
and assessing culture
79
80
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS AUDIT, RISK AND COMPLIANCE COMMITTEE REPORT
Paul Hogan
Chair of the Audit, Risk
and Compliance Committee
The committee continues to focus on
monitoring the integrity and effectiveness
of the Group’s financial reporting, risk
management and compliance processes.
Committee Members
Paul Hogan (Chair)
Sue Webb
Jim Gaul
Liz Hoctor
Roles and Responsibilities
The Committee is responsible for ensuring that the
financial performance of the Group is accurately
reported. The Committee’s role includes:
» Monitoring the integrity of the financial statements
of the Group;
» Reviewing significant financial reporting issues
and judgements;
» Reviewing the effectiveness of the internal controls;
» Monitoring and reviewing the effectiveness of the
Group’s internal audit function; and
» Making recommendations to the Board on the
appointment or removal of the external auditors as
well as approving their remuneration and terms of
engagement and evaluating their performance.
Attendance Record
Number of meetings held where member was eligible to attend
Number of meetings attended out of eight
Paul Hogan (Chair)
Sue Webb
Jim Gaul
Liz Hoctor
Length of Tenure
Appointment date
Paul Hogan (Chair)
Sue Webb
Jim Gaul
Liz Hoctor
Jun 2019
Sep 2020
Jan 2021
Jan 2021
A copy of the terms of reference of the Committee
is available on the Group’s website, www.uniphar.ie
I am pleased to present the Audit,
Risk and Compliance Committee
report for the 2022 financial year.
This report provides details on how
the Committee has discharged its
responsibilities and an update on
its areas of focus during the 2022
financial year together with the
priorities for the Committee for 2023.
Membership
The Committee is currently comprised
of four independent Non-Executive
Directors. The biographical details
of each member are set out on
page 69 to 70. Each member
brings considerable commercial,
governance and regulatory
experience to the Committee.
Meetings of the Committee
The Committee met eight times
during 2022. The Chief Financial
Officer and senior members of the
Group Finance team attend meetings
of the Committee while the Chief
Executive Officer attends when
necessary. The external auditors
attend as required and have direct
access to the Committee Chair at all
times. During the year, the Committee
met with the external auditors without
management being present.
Areas of Focus
The focus of the Committee during
the year continued to be the review
and monitoring of the integrity of the
financial statements and significant
judgements therein; review of internal
controls and risk management
processes; the effectiveness of the
Internal Audit function; overseeing
the external audit relationship and
advising the Board on whether the
Annual Report, taken as a whole is
fair, balanced and understandable.
Further details on the work carried
out in these areas are set out on the
following pages.
In addition, the Committee spent time
on the following:
» Reviewing the Group Risk
Framework including the risk
strategy, risk appetite and the
principal risks described on pages
27 to 34
» Reviewing of the Group’s insurance
programme
» Update on functional areas
including tax, treasury, data
protection and related policies
» Updates on resolution of a cyber
incident that occurred during 2021
and consideration of the financial
reporting impact
» Reviewing detailed presentations
from divisional finance leaders on
their individual business units
Audit, Risk and Compliance Committee Activities
Financial reporting
Review the annual and interim reports and related statements
Consider accounting policies and the impact of new accounting standards
Review the Annual Report, and confirm if it is fair, balanced and understandable
Consider key audit and accounting issues and judgements
Review principal risks and uncertainties
Review goodwill impairment assessments
Review the accounting for significant acquisitions
Approve going concern assessment and the Viability Statement
Governance
Corporate governance update
Risk management review
Internal audit and risk
management controls
Policy reviews: Treasury, Tax, Data Protection, Conflicts of Interest,
Anti-Bribery & Corruption, Acquisition & Strategic Projects
Directors’ Compliance Statement policy and procedures
Review of Group insurance programme
Approve and review the internal audit plan and resources
Review internal audit reports and monitor progress on open actions
Assess the principal risks and effectiveness of internal control systems
External auditors
Review the auditors independence, objectivity, performance and effectiveness
Approve the audit engagement letter and audit fees
Approve the audit plan and identity significant risks
81
82
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Financial Reporting and
Key Areas of Focus
The Committee has an important
role in providing the Board with
assurance as to the integrity of the
Group’s financial reporting processes
and the Group financial statements.
As part of this role, the Committee
considers significant accounting
policies and judgements and any
changes made to them.
The Committee reviewed the
following in respect of the year to
31 December 2022:
» The Group’s Interim Report for the
six months ended 30 June 2022
» The Preliminary Announcement
and Annual Report for the year
ended 31 December 2022
» The Group’s Trading Updates
issued in July 2022 and
January 2023
The Committee reviewed the key
areas in which estimates and
judgement had been applied in
the preparation of the financial
statements including, but not
limited to:
» Goodwill Impairment Assessment
The Committee considered the
carrying value of goodwill in
the 2022 financial statements
together with the recoverability of
the carrying value through future
cash flows. For the purposes
of its annual impairment testing
process, the Group assesses
the recoverable amount of each
of the Group’s cash generating
units (CGUs) based on the
calculation of the value-in-use.
The Committee reviewed the
goodwill impairment methodology
and specifically assessed the key
assumptions used to estimate
the recoverable amount of each
CGU, including future cash flows
and discount rates applied in
the calculation of the value in
use, along with the sensitivity
analysis performed. PwC also
presented the Committee with
their evaluation of the impairment
review process.
The Committee found the
methodology to be robust and
the results of the assessment,
together with the disclosures
in Note 10 (Intangible Assets),
to be appropriate.
The goodwill impairment test was
a particular focus for the external
auditors, who provided a detailed
assessment of their analysis to
the Committee.
» Business Combinations
During the financial year,
the Group announced the
acquisition of four businesses,
plus the acquisition of five
independent community
pharmacies. For each of these
acquisitions, the Committee
discussed with management
and the external auditors the
accounting treatment of the
consideration paid, the costs
incurred for each transaction
and the related judgements.
The Committee is satisfied
that the accounting treatment
is appropriate.
» Going Concern and
Viability Statement
The Committee assessed the
effectiveness of the process
undertaken by management
to evaluate going concern.
This included reviewing and
challenging the assumptions
used by management in
modelling projected cashflows
considering the principal risks and
uncertainties facing the Group.
The Committee also considered
the Group’s financing facilities
and future funding plans. The
Committee are satisfied that there
were no material uncertainties
that cast a significant doubt on
the Group’s ability to continue as
a going concern. The application
of the going concern basis of
preparation of the financial
statements continued to be
appropriate and the Committee
recommended the approval of the
Viability Statement.
Internal Audit
The Group operates an Internal
Audit function which reports directly
to the Committee. The Committee
is responsible for monitoring
and reviewing the operation and
effectiveness of the Internal Audit
function including its focus, plans,
activities and resources.
The Head of Internal Audit reports to
each meeting of the Committee on:
» The results of each audit and any
special investigations completed
» Status of audits in progress
» Updates on the implementation
of agreed audit actions
» Reviews undertaken on newly
acquired subsidiaries
The Committee reviewed and
approved the annual Internal Audit
plan for the year and ensured the
function is adequately resourced to
deliver the plan. The Head of Internal
Audit has direct access to the Chair
of the Committee and meets without
other members of management
present as necessary.
Fair, Balanced and Understandable
The Committee, on behalf of the
Board, reviewed the content of the
Annual Report and Consolidated
Financial Statements to ensure that,
taken as a whole, it is fair, balanced
and understandable, and provides the
information necessary for shareholders
to assess the Group’s and the
Company’s performance, position,
business model and strategy.
The Committee considered the
following in reaching their conclusion:
» The timetable for the co-ordination
and preparation of the Annual
Report and Consolidated Financial
Statements;
» Management’s process for review of
content with a focus on consistency
and balance; and
» Senior finance management
process through which the narrative
and financial sections of the 2022
Annual Report were assessed
to ensure that the criteria of fair,
balanced and understandable were
achieved.
to provide permitted financial due
diligence services. PwC are not
engaged for any other permitted
non-audit work.
During 2022, as presented in the
financial statements, the total
non-audit fees received by PwC
was €1.5m of which 65% was paid
to PwC Ireland. This represents a
ratio of 1:0.87 of audit fees versus
non-audit fees paid to PwC Ireland
and 1:1.33 of audit fees versus
non-audit fees paid to PwC globally.
The non-audit services performed by
PwC during the year can be broken
down as follows:
1) Taxation services (including tax
compliance, tax due diligence and
advisory in respect of M&A and
other tax consultancy); and
2) M&A due diligence and advisory
(non-tax).
The breakdown of fees under each
heading is illustrated on the below
table as a percentage of audit fees.
Following discussions with
management, and having considered
the above, the Committee confirmed
to the Board that the Annual
Report and Consolidated Financial
Statements, taken as a whole, is
fair, balanced and understandable.
Furthermore, the Committee noted
the formal review by PwC in relation
to the Annual Report.
Viability Statement
The Committee is responsible for
ensuring that there is a robust
process in place to allow the Board
to make the Viability Statement,
in accordance with Provision 31 of
the 2018 UK Corporate Governance
Code. The Committee reviewed
the process that management
have adopted and the stress
testing of assumptions performed.
The Committee confirmed to the
Board that it is comfortable with the
process that has been followed to
make the Viability Statement on
page 107.
Whistleblowing and
Fraud Arrangements
The Board is responsible for
overseeing whistleblowing
and ensuring that the Group
maintains suitable whistleblowing
arrangements. The Group has a
Code of Conduct on Whistleblowing
and an external service that enables
employees to raise concerns in a
confidential and anonymous manner.
During the year, the Committee
reviewed this policy and process.
The Committee is updated if any
cases are raised, but none have
been reported in 2022.
External Audit
The Committee is responsible for
overseeing the Group’s relationship
with the external auditor, including
reviewing the effectiveness and
quality of their performance,
their external audit plan, their
independence from the Group
and their audit fee proposals.
Audit plan
The external auditor presented their
audit plan to the Committee prior to
the commencement of the 2022 year
end audit highlighting their areas
of focus, work plan and resources.
During the year, the Committee
met with the external auditor,
without management being present.
This provided an opportunity for
direct dialogue with the Committee
on their areas of focus along with the
key audit management letter points.
Independence and Objectivity
The Committee is responsible for
ensuring that the external auditor is
objective and independent. PwC as
external auditor is precluded from
engaging in certain non-audit
services which would compromise
its independence, violate laws and
regulations and affect its appointment
as external auditor.
The Committee has determined
that taxation services, which are
permissible under the relevant
auditor independence rules, may
be procured by the Group from our
auditors. The Committee has also
determined that the auditor, subject
to appropriate safeguards on their
independence, may be engaged
Audit of Group accounts
M&A – Advisory other
Tax compliance services
M&A – Tax advisory services
Other – Tax advisory services
2022
2021
PwC
Ireland
€’000
PwC
Overseas
€’000
1,125
230
1,355
181
536
31
748
2,103
–
–
–
81
426
10
517
517
Total
€’000
1,125
230
1,355
262
962
41
1,265
2,620
PwC
Ireland fees
as % of
Audit fee
PwC
Ireland
€’000
PwC
Overseas
€’000
20%
16%
48%
3%
961
274
1,235
110
133
113
356
-
-
-
43
283
6
332
PwC
Ireland fees
as % of
Audit fee
29%
11%
14%
12%
Total
€’000
961
274
1,235
153
416
119
688
87%
1,591
332
1,923
66%
83
84
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
The Committee monitored non-audit
services throughout the year and
at year end performed a review of
the audit and non-audit services
provided by the external auditor
and the fees charged for those
services in respect of the year ended
31 December 2022. Following this
review and the confirmation in writing
received from the Group’s external
auditor re-affirming its independence
and objectivity, the Committee is
satisfied as to PwC’s independence
and objectivity. The Committee
will continue to closely monitor the
non-audit services provided by the
external auditor.
As a listed entity, the external auditor
is required to rotate the audit partner
responsible for the Group audit every
five years. The current audit partner
has completed his third year on
the engagement.
Priorities for 2023
The Committee will continue to
focus on the key areas of judgement,
financial reporting processes and
risk management. We will continue
to follow developments on evolving
best practice including climate
change reporting and we will spend
time reviewing new guidance and
regulations. Global macroeconomic
challenges remain omnipresent
and the Committee and Board
remain committed to the ongoing
enhancement of risk and financial
management across the Group.
On behalf of the Committee:
Paul Hogan
Chair of the Audit, Risk
and Compliance Committee
86
1) Taxation Services
As can be seen from the table below, 2022 saw a
significant increase in M&A related tax fees paid to
PwC. This increase related to the number of acquisitions
completed by the Group during the year and the
relative complexity of the tax matters associated with
those transactions. As an acquisitive Group, Uniphar
is cognisant of the efficiencies which arise from its
transaction advisors having essential historic knowledge
of tax and transactional matters, and this also gives rise
to efficiencies and effective cost control. As a Group
operating across multiple jurisdictions, the Committee
believe that it is essential for its transaction advisors to
have an overarching understanding of the broader tax
considerations of the Group and as such, believe the
ongoing use of PwC to perform transaction related tax
due diligence is justified in the best interest of the Group.
119
416
962
41
153
262
2) M&A Advisory (non-tax)
The Committee and the Board also recognise the
governance issues associated with using auditors for
non-audit work. Since 2020, the Group has engaged
firms other than PwC to conduct financial due diligence
in respect of the Hickey’s Pharmacy, Navi Group,
McCauley’s Pharmacy and BModesto Group acquisitions.
This has seen significant fees in respect of financial due
diligence in the three-year period from 2020 to 2022 being
directed away from PwC to other firms.
1,125
961
The following graph demonstrates the financial M&A
(non-tax) fees which were paid to firms other than PwC
during the year relative to those fees paid to PwC. The
graph demonstrates the increase in the use of firms other
than PwC to conduct financial due diligence in respect of
M&A demonstrating the active diversion of non-audit fees
to firms other than PwC.
230
274
2021
2022
2021
2022
PwC tax fees by category (€’000)
M&A non tax related fees (€’000)
Tax compliance services
Other – Tax advisory services
M&A – Tax advisory services
PwC M&A (non tax)
Other Firms M&A (non tax)
41
962
17%
262
961
1,125
1,088
274
274
211
230
230
78%
83%
22%
119
416
153
2021
2021
2022
2022
2021
2021
2022
2022
41
962
262
119
416
153
2021
2022
PwC non M&A fees (excl. tax) (€’000)
Audit
Non M&A fees non tax
961
78%
274
22%
2021
1,125
83%
230
2022
17%
1,088
274
211
230
2021
2022
2021
1500
For illustrative purposes, where tax related fees paid to
PwC are excluded from non-audit fees paid to PwC in
the period, the ratio is 1 : 0.2.
2022
3,360
3,039
2,935 3,019
78%
83%
22%
17%
2021
2022
1200
900
600
300
85
0
1,088
1,934
1,630 1,635
1,010 1,080
948
764
274
211
230
4
0
1
0
2021
2022
2021
165
105
54
156
2022
3,360
3,039
2,935 3,019
1500
1200
900
600
300
0
1,934
1,630 1,635
1,934
1,630 1,635
1,010 1,080
948
764
4
0
1
0
2021
3,360
3,039
2,935 3,019
165
105
54
156
2022
1500
1200
900
600
300
0
1,010 1,080
948
764
4
0
1
0
2021
165
105
54
156
2022
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS NOMINATIONS, GOVERNANCE AND SUSTAINABILITY COMMITTEE REPORT
Jeff Berkowitz
Chair of the Nominations, Governance
and Sustainability Committee
The Committee continues to oversee succession planning
for the Board and senior management and assess
the leadership needs for the Group. The Committee also oversees
the Group’s corporate governance compliance and
sustainability agenda.
Committee Members
Jeff Berkowitz (Chair)
Maurice Pratt
Ger Rabbette
Paul Hogan
Jim Gaul
Roles and Responsibilities
The Committee is responsible for overseeing succession
planning for the Board and senior management and
assessing the leadership needs for the Group to enable it
to compete effectively. The Committee also oversees the
Group’s corporate governance compliance and sustainability
agenda. The Committee’s specific roles include:
» Reviewing the structure, size and composition of the
Board including the skills, knowledge, experience and
diversity of the Directors
» Making recommendations to the Board with
regard to any changes to its composition or that of
the Committees
» Identifying and nominating candidates to fill Board
vacancies
» Reviewing the results of Board performance evaluation
processes that relate to composition of the Board
» Succession planning for senior management
» Monitoring the Company’s compliance with corporate
governance best practice
» Overseeing of the Group’s sustainability strategy
and monitoring progress against the Group’s
sustainability KPIs
87
Attendance Record
Number of meetings held where member was eligible to attend
Number of meetings attended out of one
Jeff Berkowitz (Chair)
Maurice Pratt
Ger Rabbette
Paul Hogan
Jim Gaul
Length of Tenure
Appointment date
Jeff Berkowitz (Chair)
Maurice Pratt
Ger Rabbette
Paul Hogan
Jim Gaul
Sep 2020
Oct 2009
Sept 2020
Sept 2020
Jan 2021
A copy of the terms of reference of the Committee is
available on the Group’s website, www.uniphar.ie
On behalf of the Nominations,
Governance and Sustainability
Committee, I am pleased to present
the report of the Committee for the
year ended 31 December 2022.
This provides a summary of the
Committee’s role and responsibilities,
and how the Committee discharged
these during 2022.
Membership
The members of the Committee are
set out in the table above, along
with the date of appointment of
each member and details of their
attendance at Committee meetings
during the year. The biographies and
skills of each Committee member are
set out on pages 69 to 70.
The Committee is appointed by
the Board and the terms of reference
of the Committee state that the
composition should comprise of
a minimum of three Directors, the
majority of whom must be Independent
Non-Executive Directors. This
Committee comprises a majority of
Independent Non-Executive Directors
in line with UK Code requirements.
Each appointment to the Committee
is for a term of up to three years.
This term may be extended by up to
two further three-year terms, provided
the Director in question continues to
meet the criteria for membership of
the Committee. The terms of reference
of this Committee also provide that
the Chairperson of the Board shall
be a member of this Committee and
as such, Maurice Pratt continues
his position on this Committee even
though his tenure has exceeded
three consecutive terms.
Under the terms of reference, the Chair
of the Committee may be either
the Chair of the Board or another
Independent Non-Executive Director.
Sustainability Oversight
In early 2023, the role of the
Committee was extended to include
oversight of the Group’s sustainability
strategy. Whilst the Committee
and the Board believe that the
breadth of the sustainability and
ESG topics are best served by the
broad interests and experience of
the Board as a whole and therefore
ultimate oversight should rest with the
Board, the Committee and the Board
appreciate the benefits derived from
having committee level accountability
for a key area such as sustainability.
The Committee will be supported in
its work by the Sustainability Council
which has been in place across the
business since 2020. The terms of
reference of the Committee were
updated to include oversight of the
Group’s sustainability strategy.
During 2022, the Board as a whole
considered the following topics in
relation to sustainability – the results
of the Group’s carbon foot-printing
exercise in respect of 2021, climate
reporting and interim emissions
targets, the Group’s CDP response
2022, climate related risks and
opportunities and the addition of a new
Climate Change risk on the Group’s
risk register, the Group’s external
sustainability ratings, ED&I metrics and
the launch of the Group’s employee
resource groups – the Women’s
Alliance and Rainbow Alliance. In early
2023 the Board also received externally
facilitated sustainability training.
Meetings of the Committee
The Committee met once during
2022 with the second meeting of the
Committee deferred to early 2023 in
light of the appointment of an external
evaluator to conduct an external
board evaluation.
The principal matters dealt with by
the Committee during 2022 included:
1) Board composition and succession
planning, including diversity
on the Board and the views
expressed by shareholders as
part of the Chair and Company
Secretary shareholder engagement
programme.
2) External Board Evaluation –
commencement of an external
board evaluation to identify areas
of focus for board composition
and succession planning as well as
Board effectiveness going forward.
3) Corporate Governance –
In January 2022, on the
recommendation of the Committee
following the corporate governance
compliance review conducted
at the end of 2021, the Board
resolved to adopt the UK Code as
its corporate governance code,
bringing its corporate governance
standards in line with that code
and fulfilling the commitment made
at the time of IPO to transition
to compliance with the UK Code
within three years. Details of the
provisions of the UK Code that the
Board consider not to have been
met, are set out in the Corporate
Governance Report on page 72.
Board and Committee Composition
Resignations and Appointments of
Non-Executive Directors
For the first time since the Company’s
IPO in 2019, there were no
resignations or appointments to the
Board during the year.
The Board composition has seen a
significant period of change since
IPO in 2019. At the time of IPO the
Board consisted of 12 Directors,
nine of whom were deemed not to
be independent. In the first two years
post-IPO independent representation
on the Board increased from 25%
to 62.5% with a reduction in the
number of executive directors on
the Board from three to two and
the re-composition of all Board
Committees in line with UK Code
requirements.
The Board welcomed a period of
stability during 2022 which saw Board
meetings return to in person meetings
following two years of Covid-19
restrictions. The Committee and the
Board’s focus is now on completing
the external board evaluation to
identify key areas for focus and
improvement.
Elections and re-elections at AGM
The Articles currently provide
that, in line with the provisions of
the UK Code, all Directors must
retire annually and, if eligible,
present themselves for re-election
to the Board. At the Company’s AGM
on 11 May 2022, each Director was
put forward for re-election and each
Director was re-elected to the Board
by the shareholders.
2022 AGM Voting Results and
Shareholder Engagement Programme
The Company held its 2022 AGM on
11 May 2022. All resolutions at the
AGM were passed by a significant
majority. However, Resolution 3(e) (re-
election of Jeff Berkowitz) passed with
a majority of less than 80% (78.98%
votes in favour). In line with the
requirements of Provision 4 of the UK
Code and the Company’s Significant
Votes Against Policy, the Company
published a statement following the
AGM, which acknowledged that this
resolution was passed by a majority
of less than 80%.
88
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
The Company commenced a
shareholder engagement programme
in September 2022 which saw the
Company’s Chairman and Company
Secretary engage with shareholders
who voted against this resolution
in order to better understand and
discuss the reasoning behind their
vote. Following this engagement
programme, the Committee
understands that the dissent was
primarily due to gender diversity
on the Board. The Committee and
Board’s proposed steps to increase
female representation on the Board
are set out below.
External Board Evaluation
In late 2022, Deloitte were appointed
to conduct an external board
evaluation to identify areas of
focus for the future and to assist
the Committee and the Board in
planning for the future evolution
and succession of the Board and
its Committees. The external board
evaluation includes a review of a
broad variety of board materials
and policies, and to date each
director has responded to a formal
board evaluation questionnaire and
individual interviews have been
conducted with each director.
The evaluation also includes
attendance at a Board meeting of the
Company by the external evaluator.
Some particular areas of focus for
that review include:
» Role of the Board
» Board Composition
» Succession Planning
» Chair Leadership
» Board Planning
The results of the board evaluation
are expected in Q2 of 2023 and
details of the outcomes and actions
taken will be included in the 2023
Annual Report. Following completion
of the evaluation, the Committee
will use the findings to inform
board composition and succession
planning, including Chair succession
planning, to identify any skills gaps
which should be addressed by
future board appointments, as well
as broader governance matters,
including the format and content of
materials provided to the Board.
Boardroom Diversity
The Board believes that appointing
the best people to the Board is critical
to the success of the Group and
as a result all appointments to the
Board are made on the basis of merit.
The Board recognises that diversity is
89
an essential element in building long-
term business success and ensures
that different perspectives are
introduced into Board discussions.
The Board is keen to ensure that the
Group benefits from the expertise
and insights of a high-quality diverse
Board comprising of individuals
with an appropriate balance of skills
and experience.
Diversity and equality in all aspects
remain key values in relation to Board
appointments, to include gender,
social and ethnic backgrounds,
cognitive and personal strengths,
skills, professional and industry
backgrounds, geographical
experience and diversity of thought.
The Board is conscious that in a
business operating on a global
scale, diversity of geographic
location of Directors, representative
of the geographic location of the
Groups main operations is essential
to provide context and insight
to market conditions and the
Committee continues to keep ethnic
diversity and geographic location
of Directors under consideration in
succession planning.
In January 2023, the Board, on the
recommendation of the Committee,
approved a Board Diversity Policy to
formalise and expand on the Board’s
commitment to diversity, previously
included in the Board Appointments
Policy. The Board Diversity Policy
sets out the Board’s commitment to
diversity in succession planning, to
ensure an inclusive and diverse Board.
Two out of eight of the Directors
on the Board are female which
represents 25% of the Board.
Since IPO, female representation on
the Board has increased from 18%
to 25%. The Committee is cognisant
that this falls short of the Balance
for Better Business guidance of
33% female representation by 2023.
In light of this, the Board has set a
target of 33% female representation
on the Board by the end of 2023.
Following the completion of the
ongoing external board evaluation,
the Committee will identify any
areas where additional experience
and expertise on the Board would
be beneficial and will appoint an
external recruitment consultant to
assist the Committee and the Board
in identifying the best candidate to
fill that role, with a particular focus
on female representation and the
Group’s wider diversity agenda.
Uniphar is also committed to an
ongoing focus on developing our
global talent pool and building a
more diverse leadership team for the
future. During the year the Group
launched two employee resource
groups under the Unity@Uniphar
initiative – the Women’s Alliance
and the Rainbow Alliance. Further
details on these initiatives and other
Group-wide initiatives to promote
ED&I are set out in the Sustainability
and Governance Section on page
36. As at 31 December 2022,
women accounted for 27% of
senior management and 65% of
total employees.
Board Committee Composition
Since 2021, the composition of all
Board Committees is in line with the
recommendations of the UK Code.
The Audit, Risk and Compliance
Committee and the Remuneration
Committee each comprise 100%
Independent Non-Executive Directors
and the Nominations, Governance
and Sustainability Committee
comprises a majority of Independent
Non-Executive Directors.
Paul Hogan has served as Chair
of the Audit, Risk and Compliance
Committee for 3.5 years, Sue Webb
has served as Chair of the
Remuneration Committee for 3.5
years and Maurice Pratt has served
on the Nominations, Governance
and Sustainability Committee for 13
years as a result of his position as
Chair of the Board. Each appointment
to a Board Committee is for a term
of up to three years, which may be
extended by up to two further three-
year terms, provided the Director
in question continues to meet the
criteria for membership of the relevant
Committee. The Committee has
determined that both Paul Hogan
and Sue Webb remain independent
and that it is in the best interests of
the Company to have Paul Hogan
and Sue Webb continue to chair
the Audit, Risk and Compliance
Committee and the Remuneration
Committee respectively. A review
of the composition of each Board
Committee will be conducted
following completion of the external
board evaluation.
Succession Planning
Ensuring that there are robust
succession plans in place at Board and
senior management level is fundamental
to the long-term success of the Group.
Board succession was a continued
focus of the Committee in 2022.
Executive Directors
Ger Rabbette
Tim Dolphin
Non-Executive Directors
Maurice Pratt
Paul Hogan
Sue Webb
Jeff Berkowitz
Jim Gaul
Liz Hoctor
Average tenure
Board of
Directors
Years
Audit, Risk and
Compliance
Committee
Years
Remuneration
Committee
Years
Nominations,
Governance and
Sustainability
Committee
Years
12.8
12.4
19.5
3.5
3.5
2.3
2
2
7.25
–
–
–
3.5
2.3
–
2
2
2.45
–
–
–
–
3.5
2.3
–
–
2.9
2.3
–
13.2
2.3
–
2.3
2
–
4.42
The Committee recognises the
significant changes in Board
composition in the period from IPO to
date with Board size decreasing from
12 members to eight, independence
increasing from 25% to 63% and
female representation increasing from
18% to 25%.
The Committee is cognisant that the
Board must continue to plan for the
future and evolve to meet the ongoing
needs of the Group. However,
the Committee and the Board also
acknowledge the benefits derived
from a period of stability within the
Board following significant transition
since IPO in 2019.
As outlined, the Board in late 2022
appointed external evaluators to
conduct an external board evaluation
to identify areas of focus for the
future and to assist the Committee
and the Board in planning for the
future evolution and succession of the
Board and its Committees.
To date each Director has responded
to a formal Board evaluation
questionnaire and individual
interviews have been conducted with
each Director. The results of the board
evaluation are expected in Q2 of 2023
and details of the recommendations
of that report will be included in
the 2023 Annual Report. Following
completion of the external board
evaluation the Committee will
consider the recommendations made
and will incorporate those into the
Board succession plan.
Length of Tenure
The length of tenure on the Board and
on the three main Board Committees
as at 31 December 2022 is set
out above.
Chair Tenure
Maurice Pratt joined the Board as a
Non-Executive Director in 2003 and
was appointed Chair of the Board in
2009. The Board and the Committee
are cognisant that Provision 19 of the
UK Code states that the Chair should
not remain in post beyond nine years
from the date of first appointment to
the Board. However, the Board and
the Committee are cognisant that
the UK Code allows some flexibility
in relation to Chair tenure to facilitate
effective succession planning and
the development of a diverse Board.
In light of the significant transition in
Board and Committee composition
over the past 3 years, the Board
believes that the leadership,
governance and direction from the
Chair is essential to maintaining
stability and the effective operation
of the Board in the near term.
Effective succession planning
for the Chair is a key objective
of the Committee and the Senior
Independent Director and the
Committee are aware that where
the tenure of the Chair exceeds
the recommendations of the UK
Code, a clear explanation for this
should be provided. In light of the
significant transition in Board and
Committee composition over the
past 3 years, the Committee believe
that the leadership, governance and
direction from the Chair is essential to
maintaining stability and the effective
operation of the Board in the near
term. Further details in relation to
Chair succession are set out on page
76 of this Report.
As Chair leadership is a topic being
assessed as part of the Board’s
external evaluation, following
completion of the external board
evaluation the Committee will consider
the findings and recommendations
made in that report and will
incorporate those into planning for
the Chair’s succession.
Areas of Focus for 2023
In 2022, the Committee focused on
views expressed by shareholders
in relation to Board and Committee
composition as part of the shareholder
engagement programme, and liaised
with the Chair in relation to the
appointment of external evaluators to
conduct an external board evaluation.
In 2023, the Committee will review the
recommendations from the external
Board evaluation report with a view to
incorporating these recommendations
in Board succession planning and
the overall operation of the Board
in a timely fashion. Following the
shareholder engagement programme,
the topic of Board diversity is at the
fore of Board succession planning with
the Board committed to increasing
female representation on the Board to
meet the Balance for Better Business
target of 33% by the end of 2023.
In 2023, the Committee also looks
forward to embracing its wider remit to
include sustainability oversight.
On behalf of the Committee:
Jeff Berkowitz
Chair of the Nominations, Governance
and Sustainability Committee
90
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
REMUNERATION COMMITTEE REPORT
Sue Webb
Chair of the Remuneration Committee
The Committee focuses on ensuring executive
and senior management are appropriately
incentivised to deliver long term sustainable
growth for the Group.
Attendance Record
Number of meetings held where member was eligible to attend
Number of meetings attended out of four
Sue Webb (Chair)
Jeff Berkowitz
Length of Tenure
Appointment date
Sue Webb (Chair)
Jeff Berkowitz
Jun 2019
Jan 2021
A copy of the terms of reference of the Committee is
available on the Group’s website, www.uniphar.ie
Committee Members
Sue Webb (Chair)
Jeff Berkowitz
Roles and Responsibilities
The Committee’s main duties are to:
» Determine the Group’s policy on executive and senior
management remuneration
» Review the suitability of performance measurement
criteria for the Executive Directors, the Chairman and
senior key management
» Review the notice periods for Executive Director
employment contracts
» Determine compensation arrangements for early
termination of employment contracts
» Administer LTIP schemes and Share Option Schemes
for Executive Directors and key senior management
» Review the performance of Executive Directors
against key performance indicators for the purposes
of determining annual bonus entitlements and make
recommendations to the Board about pay out level
91
As Chair of the Remuneration
Committee, I am pleased to present
the report for the Committee for the
year ended 31 December 2022.
The objective of this Report is
to provide the shareholders with
information, to enable them to
understand the remuneration
structures in place and how they
relate to the Group’s financial
performance. The report also
provides a summary of the
Committee’s roles and responsibilities
and how these were discharged
during 2022.
Performance in 2022
The Group delivered a strong
performance during 2022 and saw
Gross Profit increase by 11.7% from
€274.5m to €306.7m, with gross profit
organic growth of 5.7% and EBITDA
increasing by 13.4% from €86.5m
to €98.0m. The strong profitability is
reflected in a robust Return on Capital
Employed for the year of 17.3%.
This performance was against the
backdrop of a challenging operating
environment globally, which brought
increasing cost pressures combined
with an uncertain economic
backdrop. A detailed summary of
the Group’s financial performance
during 2022 is set out in our Financial
Review section of this Report on
page 57.
Shareholder Return in 2022
In May 2022, the Group paid a final
dividend to shareholders of €3.0m in
respect of the year ended 2021 and
in October 2022 the Group paid an
interim dividend of €1.7m. As a result
of the Group’s strong performance in
2022, it is proposed that, subject to
shareholder approval at the Group’s
AGM in May 2023, a final dividend of
€3.1m will be paid to shareholders on
the register at 21 April 2023.
UK Code Compliance
The Board resolved in January 2022
to formally adopt the UK Code as
the Corporate Governance Code of
the Group. Following a number of
remuneration changes in respect
of Executive Director remuneration
since 2020, the Committee believes
that the current Remuneration Policy
is effective in aligning to the Group’s
purpose and values, links to the
successful delivery of the Group’s
long-term strategy and shareholder
interests and reflects the Group’s
strong performance during the year.
The Committee has ensured that
the disclosures in relation to the
remuneration structures reflect best
corporate governance practice,
having regard to the Group’s size
and the markets on which its shares
are listed.
2022 Executive Director Remuneration at a Glance
Committee Composition
The composition of the Committee
currently consists of 100%
Independent Non-Executive Directors
in line with the provisions of the UK
Code and the terms of reference of
the Committee. Biographies of each
Committee member are set out on
page 70.
Remuneration Policy in 2023
The Committee has determined
that the core substance of the
Remuneration Policy continues
to align with our Group
business strategy and priorities.
The Committee believes that
the introduction of a new Share
Option Scheme during 2022 was
necessary in order to continue to
align the remuneration of Executive
Directors with the long-term
interests of shareholders in light of
the performance conditions having
been achieved under the 2018 LTIP
Scheme. The performance metrics for
the 2023 annual bonus scheme mirror
those for 2022. The performance
targets linked to each metric for 2023
are commercially sensitive and are
therefore not disclosed.
On behalf of the Committee:
Sue Webb
Chair of the Remuneration Committee
G. Rabbette
Salary/Fees
Pension/Allowance
Other Benefits
Total Fixed Pay
Bonus
Total Variable Pay
LTIP
Total 2022
Total 2021
€618,000
€45,000
€50,000
€713,000
€603,000
€603,000
€nil
€1,316,000
€1,280,000
T. Dolphin
Salary/Fees
Pension/Allowance
Other Benefits
Total Fixed Pay
Bonus
Total Variable Pay
LTIP
Total 2022
Total 2021
€412,000
€30,000
€45,000
€487,000
€402,000
€402,000
€nil
€889,000
€865,000
Total 2022: €1,316,000
EBITDA
€98.0m
2022: €98.0m
2021: €86.5m
2020: €66.7m
2020
2021 2022
Total 2022: €889,000
Gross Profit
€306.7m
2022: €306.7m
2021: €274.5m
2020: €217.3m
50
0
2020
2021 2022
92
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Remuneration Policy
The Group is committed to promoting a transparent remuneration structure. The following table outlines the key factors
considered by the Committee, in accordance with the requirements of the UK Code.
UK Code
Clarity
Remuneration arrangements should be
transparent and promote effective engagement
with shareholders and the workforce.
Simplicity
Remuneration structures should avoid
complexity and their rationale and operation
should be easy to understand.
Uniphar Remuneration Policy
The annual bonus, 2018 LTIP scheme and the 2022 Share Option
Plan have been designed to incentivise Executive Directors to
achieve defined, stretch targets in line with the Group’s growth
strategy. Performance measures and targets are reviewed each
year by the Committee to ensure that they continue to be clear
and appropriate.
There is a grid-based bonus structure in place, to reflect a
scale of performance, which has been externally benchmarked.
This supports the Committee’s aim of operating a simple
remuneration structure designed to align the Executive Directors’
interests with those of shareholders in achieving the Group’s
growth strategy.
Risk
Remuneration arrangements should ensure
that reputational and other risks from
excessive rewards, and behavioural risks that
can arise from target-based incentive plans,
are identified and mitigated.
The Remuneration Policy was designed to provide an appropriate
level of remuneration to recruit and retain the necessary skill
and talent to develop and deliver the business strategy, with the
objective of delivering strong growth in a sustainable and focused
way to deliver long-term value to stakeholders.
Predictability
The range of possible values of rewards to
individual Directors and any other limits or
discretions should be identified and explained
at the time of approving the policy.
Proportionality
The link between individual awards, the delivery
of strategy, and the long-term performance
of the Company should be clear. Outcomes
should not reward poor performance.
The Committee believes that it is important that a significant
proportion of the remuneration package of Executive Directors and
senior management is performance related. The potential value
and composition of Executive Directors’ remuneration packages
at minimum, on target, and maximum scenarios are outlined on
page 102.
Payments of the annual bonus requires the delivery against
ambitious strategic targets for the Group. The performance
measures are directly aligned to the Group’s strategy and KPIs.
The vesting of share options, granted pursuant to the Group’s 2022
Share Option Plan, is linked to Total Shareholder Return (‘TSR’) over
the period to 31 December 2026.
The Committee has direction to exercise judgement and discretion
in authorising remuneration outcomes, to ensure that they are
appropriate and reflective of overall performance.
Alignment to Culture
Incentive schemes should drive behaviours
consistent with company purpose, values
and strategy.
The Committee is cognisant that the Remuneration Policy is aligned
and benchmarked to market leaders, competitors, and industry
standards, to ensure that it is fair and competitive.
Uniphar places a strong emphasis on working responsibly and
sustainably, and for this reason a specific sustainability and
governance measure is included as part of the bonus grid.
Details of how the performance measures are linked to the delivery
of the Group’s strategy are outlined on page 94.
Consideration of Conditions elsewhere in the Group
Whilst the Committee does not directly consult with employees when formulating Executive Director pay policy,
the Committee does take into consideration information on pay arrangements for the wider employee population when
determining the remuneration of Executive Directors. Since 2021, Executive Director pension contributions are aligned
with that of the wider workforce of the Uniphar Group. The appointment of Jim Gaul to the Board in January 2021 with
his remit covering the area of employee engagement, further enhances consideration of wider workforce conditions
when making Board decisions.
Consultation with Shareholders on Executive Remuneration
The Committee did not engage in formal shareholder consultation during the year in relation to Executive remuneration.
Directors’ Remuneration Policy Report
Executive Directors
Executive remuneration within the Group can be broken down into the following five components, which we believe
provide a fair balance between fixed and performance related remuneration.
Key
Salary
Purpose & Link to
Group Strategy
Provide an
appropriate level of
fixed remuneration
to recruit and retain
the necessary skill
and talent to develop
and deliver on the
business strategy.
Bonus
To drive and
reward for the
delivery of business
objectives over the
financial year.
Operation
Detail
Performance Metric
An appropriate base
salary is set and
reviewed by the
Committee annually.
Factors taken into
consideration include:
» Skills and
experience
» Specific role and
level of responsibility
» External
benchmarks,
including economic
indicators and
geographical scope
The Committee reviews
the performance of the
Executive Directors
for the purposes of
determining annual
bonus entitlements
and makes
recommendations to
the Board as to the
pay-out level.
Base salaries and increases are
aligned and benchmarked to
market leaders, competitors and
industry standards.
Not Applicable
Future salary increases for
Executive Directors will be
linked to those of the wider
Group workforce.
Based on the bonus
grid, 80% of an
Executive Directors
bonus is linked to
Group performance
and specifically
in achieving
challenging financial
performance targets.
The remaining 20%
opportunity is linked
to non-financial
performance targets
established by the
Committee, being
personal as well
as sustainability
and governance
objectives.
There is a bonus grid in place
which is designed to align
management’s interests with
those of shareholders. The
maximum potential bonus
opportunity for Executive
Directors is up to a maximum of
130% of base salary. The bonus
opportunity for the achievement
of on-target Group and personal
performance targets is up to
75% of maximum opportunity,
being 97.5% of base salary.
At the threshold performance
level of 95% of target, a
bonus opportunity of 37.5%
of maximum, being 49% of
base salary is payable. Where
the threshold performance of
95% is not reached, no bonus
is payable.
In 2022, the Committee
approved the deferral of 100%
of Executive Directors’ gross
annual bonus entitlement for a
period of 5 years in the form of
in-market share purchases.
93
94
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Key
Purpose & Link to
Group Strategy
Pension To provide a
competitive, flexible
retirement benefit
that does not impose
any unacceptable
level of financial risk
on the Group.
To provide other
market competitive
monetary and non-
monetary benefits.
To reward
participants for
the delivery of the
Group’s long-term
goals and driving
shareholder value.
Benefits
LTIP
UNIPHAR PLC ANNUAL REPORT 2022
Operation
Detail
Performance Metric
Executive Directors are
enrolled into a defined
contribution pension
plan or are offered
the alternative of
cash allowances.
Pension contributions of 7.5%
of annual base salary apply to
all Executive Directors, aligning
with the average contributions
available to the Group’s
wider workforce.
Not Applicable
Provide a level of
benefits or specified
monetary allowances
including, healthcare
and car.
The 2018 LTIP
represents 4.8%
of issued share
capital, with
Executive Directors
and key employees
participating in the
arrangement. All shares
in the 2018 LTIP were
allotted prior to the
Group’s IPO in 2019
and therefore have
had no dilutive impact
since IPO.
In 2022, the Committee
and the Board
approved a new Share
Option Plan (the ‘2022
Plan’) to incentivise
Executive Directors
and key members of
senior management,
in light of the fact
that the performance
conditions of the 2018
LTIP had been met
during 2021.
The level of benefits is set at an
appropriate market rate.
Not Applicable
The 2018 LTIP is fully allotted,
and the details of each
Executive Director’s interest
is set out below.
Details of the grant of share
options to Executive Directors
during 2022 are set out below.
The performance
conditions attaching
to the 2018 LTIP were
met during 2021
and these shares
remain subject to a
service condition until
31 December 2024.
Awards of share
options to Executive
Directors under
the 2022 Plan are
subject to (i) a TSR
condition (based on
the average closing
trading price per
ordinary share in the
30-day period prior
to 31 December
2026 against the
exercise price of
€3.48, and inclusive
of any dividends
in the period) and
(ii) the Executive
Directors continued
employment with
the Group through
31 December 2026.
Non-Executive Directors
The Board aims to recruit high-calibre Non-Executive Directors, with broad commercial, international or other relevant
experience. Non-Executive Directors cannot individually vote on their own remuneration. Non-Executive Director
remuneration is reviewed by the Chairman and the Executive Directors and discussed and agreed by the Board.
Non-Executive Directors may attend the Board discussion but may not participate in it.
In accordance with the resolution passed at the 2019 AGM, the aggregate fees payable to the Non-Executive Directors
shall not exceed €750,000. Changes to the total aggregate remuneration of all Non-Executive Directors is subject to
shareholder approval.
Non-Executive Directors are paid additional amounts to take account of increased time commitments, including acting
as the Senior Independent Director and/or Chair of a Board Committee. In addition, all reasonable and documented
expenses incurred in the performance of the Non-Executive Directors’ duties are reimbursed.
Annual Report on Remuneration 2022 (audited*)
The following table sets out the total remuneration for Directors for the years ended 31 December 2022 and
31 December 2021:
Director9
Salary
/fees
€’000
Pension/
Allowance
€’000
Other
Benefits5
€’000
Fixed
Pay
€’000
Bonus
LTIP
€’000
€’000
Variable
Pay
€’000
Total
2022
€’000
Total
2021
€’000
Executive Directors
G. Rabbette
T. Dolphin
P. Dempsey1
618
412
–
Non-Executive Directors
M. Pratt
P. Hogan
J. Berkowitz
S. Webb
J. Gaul3
L. Hoctor3
G. Penny1
P. Staunton2
M. McConn4
Total
176
100
100
85
70
70
–
–
–
1,631
45
30
–
–
–
–
–
–
–
–
–
–
75
50
45
–
–
–
–
–
–
–
–
–
–
95
713
487
–
603
402
–
176
100
100
85
70
70
–
–
–
1,801
–
–
–
–
–
–
–
–
1,005
–
–
–
–
–
–
–
–
–
–
–
–
603
402
–
1,316
889
–
1,280
865
865
–
–
–
–
–
–
–
–
1,005
176
100
100
85
70
70
–
–
–
2,806
176
100
100
85
65
65
70
25
2
3,698
* This table is audited and forms an integral part of the audited financial statements. The other parts of the Remuneration Committee
Report are unaudited.
1.
2.
3.
4.
5.
P. Dempsey and G. Penny resigned as Directors on 17 December 2021.
P. Staunton resigned as a Director on 12 May 2021.
J. Gaul and L. Hoctor were each appointed to the Board on 26 January 2021.
M. McConn resigned as a Director on 26 January 2021.
Other benefits principally include health and car allowances.
Executive Directors’ Remuneration
Executive remuneration within the Group can be broken down into the following five components, which we believe
provide a fair balance between fixed and performance related remuneration.
Base Salary
The base salaries of Executive Directors are reviewed annually, having regard to personal performance, skills and
experience; changes in levels of responsibility; external benchmarks to market leaders, competitors, and industry
standards; as well as the pay and conditions in the wider Group. During 2022, the Executive Directors received a 3%
base salary increase in line with annual base salary increases of the wider workforce.
The following table sets out the salaries for the Executive Directors for the relevant financial year:
G. Rabbette
T. Dolphin
2022
€’000
618
412
2021
€’000
600
400
Annual Bonus
For the year ended 31 December 2022, the maximum potential bonus opportunity for Executive Directors was up
to a maximum of 130% of base salary. The bonus opportunity for the achievement of on-target Group and personal
performance targets was up to 75% of maximum opportunity, being 97.5% of base salary. At the threshold performance
level of 95% of target, a bonus opportunity of 37.5% of maximum, being 49% of base salary is payable. Where the
threshold performance target of 95% is not reached, no bonus is payable.
In setting the on-target return the Committee and the Board were cognisant of the ambitious strategic targets set for
the Group and sought to align the Executive Directors’ interests with those of shareholders in achieving the Group’s
stated strategy. On this basis, the Committee and the Board believe that 75% of the maximum opportunity for achieving
performance targets is appropriate.
95
96
OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
The following table sets out the performance measures applied for Executive Directors for the year ended
31 December 2022:
% of maximum Link to strategy
EBITDA
Stretch EBITDA
Organic Gross Profit Growth
Free Cash Flow Conversion
Financial targets
Personal Objectives
Sustainability & Governance
Non-Financial Targets
40%
25%
7.5%
7.5%
80%
15%
5%
20%
100%
Key measure of underlying profitability
Delivery of Group’s long-term growth strategy
Key measure of continued client growth
Cash generation for reinvestment or return to shareholders
Ensure focus on strategic/functional priorities of the Group
Drive continuous improvements in sustainability, governance and
culture across the Group
The performance targets were set by the Committee based on the Board approved budget for the year.
Committee Discretion
The Committee has retained the discretionary ability to adjust the value of an award under the annual bonus scheme,
if the award in the Committee’s opinion, taking all circumstances into consideration, produces an unfair result.
In exercising this discretion, the Committee may take into consideration the individual or the Group’s performance
against non-financial measures. In respect of the financial year ended 31 December 2022, the Committee has exercised
this discretion in respect of potential awards under the Stretch EBITDA annual bonus metric and, in light of global
macroeconomic and inflationary pressures, has concluded it to be appropriate to make no annual bonus award in
respect of this metric during 2022.
Review of Financial Targets
Subsequent to the end of the financial year, the Committee reviewed actual performance against the targets set for
each Executive Director. Following this review, the Committee determined that the Executive Directors should be
awarded bonuses based on the achievement of financial targets, as illustrated in the table below:
EBITDA
Stretch EBITDA
Organic Gross Profit Growth
Free Cash Flow Conversion
Financial targets
% of maximum
Actual %
40%
25%
7.5%
7.5%
80%
40%
0%
7.5%
7.5%
55%
Due to the commercial sensitivity of the Group’s defined financial targets these targets have not been disclosed.
The following table summarises performance for each of the financial objectives:
Measure
Definition
Performance Targets
Actual Performance
EBITDA
Earnings before exceptional
items, net finance expense,
income tax expense,
depreciation and intangible
assets amortisation.
The impact of unbudgeted
acquisitions and disposals
is excluded.
Stretch
EBITDA
The Stretch EBITDA measure
is the Group EBITDA
including the contribution
of unbudgeted acquisitions
and disposals.
Organic Gross
Profit Growth
Free Cash
Flow
Conversion
Organic gross profit growth
is defined as the growth
from restated prior period
gross profit to current period
gross profit as a % of the
restated prior period value.
The restatement to the prior
year value is to include the
corresponding prior period
performance of acquisitions
and exclude the prior period
performance of disposals.
Free cash flow conversion
is defined as EBITDA, less
investment in working
capital, less maintenance
capital expenditure,
divided by EBITDA.
The pay-out of the Group EBITDA
bonus is based on the achievement of
defined threshold and budget targets.
100% of the bonus %
attributed to Group EBITDA
being achieved has
been awarded.
Threshold performance equates
to 95% of budget EBITDA.
On achievement of threshold
performance, 50% of the portion
of the bonus attributable to
EBITDA performance is payable.
This increases to 100% pay-out of
EBITDA bonus when 100% of Group
EBITDA budget is achieved. Payment
for performance between threshold
and budget is on a pro-rata basis.
No portion of basic bonus is paid
where actual EBITDA is below
threshold performance.
Achievement of stretch bonus
is based on pre-defined Stretch
EBITDA targets.
Payment for performance between
achievement of budget and the
Stretch target is on a pro-rata basis.
Achievement of the bonus
required organic gross profit growth
in the year.
The Group’s free cash flow
conversion target for the purpose
of the annual bonus is in line with
achieving the Group’s medium-
term outlook.
Threshold performance equates to
a free cashflow conversion of 5%
below the target range resulting in
a payout of 50%. No bonus is paid
if actual free cash flow is below
threshold performance. A full 100%
bonus is paid if budget free cashflow
is reached or exceeded.
Payment between threshold and
budget performance is on a pro-
rata basis.
The Committee has
exercised its discretion,
and in light of global
macroeconomic and
inflationary pressures,
has concluded that the
Stretch EBITDA element of
the annual bonus should
not be applied for 2022.
The Committee determined
that organic gross profit
growth exceeded the
target, and accordingly,
this element of the bonus
was achieved in full.
Actual free cashflow
conversion exceeded the
targeted performance,
and accordingly, this
element of the bonus was
achieved in full.
97
98
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Review of Non-Financial Targets
20% of the maximum bonus opportunity is linked to non-financial performance targets, recommended by the
Committee and subsequently approved by the Board. Subsequent to the end of the financial year, the Committee
reviewed actual performance against the targets set for each Executive Director. Following this review, the Committee
determined that the Executive Directors should be awarded bonuses based on the achievement of non-financial targets,
as illustrated in the table below:
Personal Objectives
Sustainability and Governance
Non-Financial Targets
% of maximum
Actual %
15%
5%
20%
15%
5%
20%
Personal Objectives
The performance of the Executive Directors is also measured against personal and strategic objectives, which in 2022,
focused on Leadership and Strategy, Portfolio Optimisation, Operating Model, and Talent and Succession. Performance
against these objectives is determined by the Committee by reference to key targets agreed with the Executives at the
start of the year.
These objectives include the achievement of operational goals, the Executive Director’s contribution to Group strategy,
as a member of the Board, and specific goals related to their functional role.
Achievements
G. Rabbette
» Leadership and Strategy: developed the Group’s strategy and long-term vision and managed its
implementation during the year
» Portfolio Optimisation: identified and executed M&A transactions, to enable the implementation of
the Group’s strategy
» Operating Model: led and embedded significant enhancements to the Group’s operating
model, driving commercial excellence, global consistency and agility
» Talent and Succession: took a leading role in driving talent development within the Group and
building a succession plan to meet the business’s longer-term leadership needs
» Culture: actively supported the development of the culture and engagement agenda across
the Group
T. Dolphin
» Leadership and Strategy: worked across all business and functional areas, supporting the
development and implementation of the Group’s strategy and long-term vision
» Portfolio Optimisation: evaluated and executed M&A transactions, to enable the implementation
of the Group’s strategy
» Operating Model: took an active role in driving changes to the Group’s operating model, ensuring
its cost effectiveness
» Talent and Succession: actively contributed to identifying and developing potential future talent.
» Culture: Actively supported the development of the culture and engagement agenda across the
Uniphar Group
Sustainability & Governance
Uniphar places a strong emphasis on working responsibly and sustainably. The Committee determined that, in order to
align the Executive Directors’ to these interests, specific performance targets should be introduced to drive continuous
improvements in sustainability, governance and culture across the Group.
The Committee determined that the Executive Directors should be awarded the maximum bonus opportunity
attributable to Sustainability and Governance as a result of the following:
» The continued successful implementation of the sustainability framework and governance structure across the Group
as outlined in the Sustainability and Governance Report
» Supporting the implementation of Group-wide decarbonisation plans including separate divisional plans
» Supporting improvements in ESG data collection across the Group for all metrics
» Supporting CDP submission and improvement in CDP rating
» Supporting the initiation of a project to deliver a Group supplier code of conduct and responsible sourcing policy with
a view to launching a supplier engagement programme during 2023
» Supporting the Future of Work employee listening exercise
» The implementation of initiatives across the Group’s locations as outlined in the Sustainability and Governance Report
» Supporting the expansion of the shareholder engagement programme in line with the requirements of the UK Code
Total Annual Bonus Payable
Following a review of the actual performance for both the financial and non-financial measures against targets,
the Committee recommended, and the Board approved, a total bonus outcome of 75% of maximum bonus opportunity,
being 97.5% of base salary. 100% of the gross bonus achievement will be deferred for a period of five years in the form
of in-market share purchases. Shares purchased in-market will be held by an Irish registered employee benefit trust
established by the Company and the beneficial interest will be held by the Executive Directors subject to restrictions on
dealing for the five-year period. The restrictions in respect of the 2022 deferred bonus amount will cease in 2028.
The Committee considers that the level of achievement is appropriate and reflective of the overall performance of the
Group and the value created for shareholders during the year.
Clawback Policy
Bonus payments made to Executive Directors are subject to clawback for three years from payment in certain
circumstances including:
» A material misstatement of the Company’s audited financial statements
» A material breach of applicable health and safety regulations
» Business or reputational damage to the Company or a subsidiary arising from a criminal offence, serious misconduct
or gross negligence by the individual Executive
Pension
All pension benefits for Executive Directors are determined in relation to base salary. Fees payable to Non-Executive
Directors are not pensionable. Under the current Remuneration Policy, pension benefits for Executive Directors are a
maximum of 7.5% of base salary, in line with average pension contributions available to the Group’s wider workforce.
Other Benefits
Employment-related benefits for Executive Directors provide a level of benefits or specified monetary allowances
including healthcare and car allowances.
LTIP
The 2018 LTIP represents 4.8% of issued share capital of the Company, with Executive Directors and key employees
participating in the arrangement. All shares in the 2018 LTIP were allotted prior to the Group’s IPO in 2019 and,
therefore, have had no dilutive impact since IPO. There were no LTIP share awards granted to Executive Directors in
2022 under the 2018 LTIP, which is now fully allotted. All share price performance conditions attributable to these LTIP
share awards were satisfied during 2021. These shares remain subject to the satisfaction of the service condition and,
as a result, will not vest until 31 December 2024.
The table below sets out details of share awards made under the 2018 LTIP currently held by Executive Directors:
Executive
Director
Grant Date Exercise
Price
No. of share
awards at
1 Jan 2022
Granted
Vested/
Exercised
Lapsed No. of share
awards at
31 Dec 2022
End of
Performance
Period
G. Rabbette
T. Dolphin
28 Apr 2018
28 Apr 2018
n/a
n/a
3,685,427
2,284,965
–
–
–
–
–
–
3,685,427
2,284,965
31 Dec 2024
31 Dec 2024
2022 Share Option Plan
On 21 November 2022, on the recommendation of the Committee, the Board approved the closure of the 2021 Share
Option Plan (the ‘2021 Plan’) to new entrants and the adoption of the 2022 Plan, a new share option plan for the period
2022 – 2026 for eligible employees, including the Executive Directors. The Executive Directors had not received any
awards under the 2021 Plan. Awards under the 2022 Plan take the form of options to subscribe for new ordinary shares
in the Company. Under the 2022 Plan, there is a reserve of an additional 5% of the issued share capital of the Company,
plus the unallocated reserve from the 2021 Plan (which had an initial reserve of 2.5% of the issued share capital of the
Company and, at the time of closure of that Plan, awards in respect of 0.4% of the issued share capital of the Company
had been granted).
The Committee and the Board believe that the introduction of the 2022 Plan was necessary, in order to ensure
alignment of incentives for Executive Directors and senior management with the long-term interests of shareholders.
The Executive Directors’ existing share-based incentives under the 2018 LTIP were awarded prior to the Company’s
IPO in 2019 and took the form of issued ordinary shares. As the awards under the 2018 LTIP were issued prior to
IPO in 2019, there has been no dilutive impact on the Company’s issued share capital from the Executive Directors’
share-based incentivisation since IPO.
99
100
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS In particular, in relation to the Executive Directors, it is noted that the performance conditions applicable to their awards
under the 2018 LTIP were fully satisfied in July 2021 (achieving a share price of €3.30, following an IPO price of €1.15)
and the service condition applicable to their awards is due to be satisfied on 31 December 2024. The Committee and
the Board believe that, as the performance condition under the 2018 LTIP has been satisfied, it is necessary and in the
best interests of shareholders to ensure that a robust incentivisation plan is in place for Executive Directors and senior
management beyond the vesting date of 31 December 2024, under the 2018 LTIP.
The share options granted to the Executive Directors, as outlined below, have been granted as conditional awards and
will vest on 31 December 2026, subject to the grantee’s continued service and the Committee’s assessment of the
extent to which the applicable performance condition has been satisfied. The performance condition is linked to Total
Shareholder Return (‘TSR’) (based on the average closing trading price per ordinary share in the 30-day period prior
to 31 December 2026 against the exercise price of €3.48, and inclusive of any dividends in the period) on a sliding
scale basis, where TSR of ≥70% will see 100% of the awards vest and TSR of <50% would see no awards vest.
The Committee and the Board believe that a TSR condition directly aligns Executive Director incentivisation with the
long-term interests of shareholders.
The Committee completed a market benchmarking analysis of 13 peer companies to establish practices in relation to
(1) the annual value of the CEO and CFO LTIP earning opportunity as a % of base salary provided by each company,
and (2) the LTIP performance conditions utilised by these companies. The findings showed that for the CEO position,
companies provided between 150% (median) and 200% (75th Percentile) of annual salary in the form of an annual
LTIP earning opportunity. For the CFO position, companies provided 150% (both median & 75th Percentile) of annual
salary in the form of an annual LTIP earning opportunity. The analysis showed that the most common LTIP performance
condition was TSR, used by nine of the companies benchmarked.
A valuation of the share options granted to the Executive Directors was conducted to determine the annual fair value of
the grant. A fair value of €0.87 per share option was reached which results in an annualised fair value of the grants to
the CEO and CFO of 138% and 140% of base salary per annum respectively which is in line with benchmarking.
Benchmarked Companies
Datalex plc
C&C Group plc
Dalata Hotel Group plc
Diploma plc
FBD Insurance plc
Ergomed Limited
DCC plc
Dechra Pharmaceuticals plc
Glenveagh Properties plc
Glanbia plc
Irish Residential Properties plc
Origin Enterprises plc
CVS Group plc
Executive
Director
Grant Date Exercise
Price
No. of share
awards at
1 Jan 2022
Granted
Vested/
Exercised
Lapsed No. of share
awards at
31 Dec 2022
End of
Performance
Period
G. Rabbette
T. Dolphin
30 Nov 2022
30 Nov 2022
€3.48
€3.48
– 4,000,000
– 2,700,000
–
–
–
–
4,000,000
2,700,000
31 Dec 2026
31 Dec 2026
The awards granted to Executive Directors under the 2022 Plan expire on 30 November 2032, being ten years from the
date of grant (30 November 2022), have an exercise price of €3.48 per ordinary share, and vest on 31 December 2026,
subject to satisfaction of the vesting conditions outlined above. Given the TSR condition, the earliest date on which the
share options awarded to the Executive Directors can be dilutive is 31 December 2026.
The Board has no current intention to make any further awards to the Executive Directors under the 2022 Plan.
Minimum Shareholding Requirements
The Committee has sought to promote long-term shareholdings by Executive Directors, to support alignment with
shareholder interests, and has adopted minimum shareholding requirements for Executive Directors. These guidelines
specify that Executive Directors should, over a period of five years from the date of appointment, build up and then
retain a shareholding in the Company with a valuation of at least equal to twice their annual base salary.
Additionally, the Committee has adopted guidelines relating to post-employment shareholding guidelines.
These guidelines require that Executive Directors maintain their full minimum shareholding requirement of twice
base salary for a period of two years post-employment.
Current Executive Director shareholdings at 31 December 2022, as a multiple of their base salary:
G. Rabbette
T. Dolphin
* Based on closing share price of €3.10 on 31 December 2022.
101
Minimum
2.0x
2.0x
Actual*
40x
42x
Performance related Remuneration Outcomes
CEO – Scenario Pay Structure €’000
CFO – Scenario Pay Structure €’000
1,600
1,400
1,200
1,000
800
600
400
200
0
Minimum
At budget
Maximum
Fixed Pay
Bonus
1,600
1,400
1,200
1,000
800
600
400
200
0
Minimum
At budget
Maximum
Fixed Pay
Bonus
Remuneration consists of fixed pay (base salary, pension, and benefits) and variable pay (annual bonus and LTIP).
A significant portion of Executive Directors’ remuneration is linked to the delivery of key business goals over the
short and long-term and the creation of shareholder value. The charts above present scenarios of the remuneration
outcomes of:
Minimum
At Budget
Maximum
Pay-out levels
» Fixed Pay
» No bonus pay-out
» Fixed Pay
» 75% of maximum bonus opportunity, in line with budgeted performance targets
» Fixed Pay
» 100% of maximum bonus opportunity, in line with budgeted performance targets
Percentage Change in Executive Directors’ Remuneration
The following table sets out the relative change from 2021 to 2022 in the remuneration earned by the Executive
Directors, compared with the average percentage change for the Group’s employees:
€’000
G. Rabbette
T. Dolphin
Total Executive Directors
Average Employee Remuneration
2022
1,316
889
2,205
55.7
2021
1,280
865
2,145
57.1
% Change
2.8%
2.8%
2.8%
-2.5%*
* The change in Average Employee Remuneration is impacted by the acquisition of new entities by the Group combined with an
increasing footprint in retail pharmacy.
Relative Importance of Spend on Pay
The table below sets out the amount paid in remuneration to all employees of the Group, compared to gross profit,
EBITDA and dividends declared in respect of the financial year:
€’000
Total Employee Remuneration*
Gross Profit
EBITDA
Dividend**
2022
164,595
306,744
98,040
4,750
2021
166,861
274,497
86,481
4,532
% Increase
-1.4%
11.7%
13.4%
4.8%
* Total employee remuneration includes €1,063,000 (2021: €190,000) of payroll costs which have been capitalised during the year.
** Reflecting progressive dividend commitment made at the time of IPO.
102
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Advisers to the Committee
During 2022, the Group engaged the services of external remuneration consultants Gurren Compensation Limited.
Their advice related to the structuring of the 2022 Plan and remuneration packages for executives and key senior
management. The total fees paid to Gurren Compensation Limited in respect of these services during the year were
€24,750. These were charged on a time and materials basis.
The Group also engaged the services of William Fry in relation to the implementation of the decisions of the Board on
remuneration during the year. No other external advisers were engaged in respect of remuneration consulting services
during the year.
Payments to Former Directors
There were no payments to former Directors in accordance with Section 305 of the Companies Act 2014 during the year.
Payments for Loss of Office
There were no payments to Directors for loss of office during the year.
Non-Executive Directors’ Remuneration
The Board aims to recruit high-calibre Non-Executive Directors, with broad commercial, international or other relevant
experience. Fees paid to the Non-Executive Directors for the 2022 and 2021 financial years are outlined in the
Remuneration table on page 96.
Non-Executive Directors do not participate in any Group share incentive or award schemes.
Service Contracts/Letters of Appointment
Details of the service contracts for the Executive Directors are outlined below:
Name
Ger Rabbette
Tim Dolphin
Title
Chief Executive Officer
Chief Financial Officer
Date of Contract
Notice Period
27 June 2019
27 June 2019
12 months
12 months
The Company can terminate Executive Director employment by making a lump sum payment, in lieu of notice,
consisting of the basic salary for the notice period. Standard ‘cause’ provisions are included which allow the Company
to terminate without notice or the obligation to make a payment in lieu of notice. There are also standard ‘garden
leave’ provisions for all Executive Directors, together with post-termination restrictions on competing activity and
non-solicitation of customers or key employees. These are effective for a period of 12 months after termination.
Each of the Non-Executive Directors has been appointed under the terms of a letter of appointment. Appointment is
terminable by either party giving one month’s written notice or otherwise, in accordance with the Articles. Continuation
of appointment is contingent on satisfactory performance, re-election (where applicable), in accordance with the
Articles and any relevant statutory provisions for the removal of Directors. Standard ‘cause’ provisions are included that
entitle the Company to terminate a Non-Executive Director’s appointment without notice or payment of compensation.
The appointment letter includes membership of any Board Committees, the fees to be paid and the time commitment
expected. The letter also covers matters such as confidentiality, data protection and the Company’s share dealing
policy. Dates of appointment and retirement for the current Non-Executive Directors are set out below:
Appointment
July 2003
June 2019
September 2020
June 2019
January 2021
January 2021
Date of Retirement
-
-
-
-
-
-
Name
M. Pratt
P. Hogan
J. Berkowitz
S. Webb
J. Gaul
L. Hoctor
103
The Directors present their Director’s
report and audited Group financial
statements for the year ended
31 December 2022.
Principal Activities and Review of
the Development of the Business
The Group is a leading service
provider within the pharmaceutical
and healthcare sector, headquartered
in Ireland, with offices in the UK,
Europe, the US and the Asia
Pacific region.
By promoting a strong service-
based culture and working with our
partners, we provide an innovative
range of services, including product
distribution and the provision
of specialist services for the
pharmaceutical and healthcare sector.
The business is divided into three
trading divisions: Commercial
& Clinical, Product Access and
Supply Chain & Retail.
» Commercial & Clinical provides
outsourced sales, marketing,
distribution and consultancy
solutions to multinational
pharmaceutical and medical device
manufacturers. Active in Ireland,
the UK, the Benelux, the Nordics,
Germany and the US, the Group
is growing with its clients to
provide pan-European solutions
and a targeted service offering
in the US. Uniphar has built fully
integrated, digitally enabled
customer centric solutions that
are supported by our highly
experienced and clinically
trained teams, leveraging our
digital technology and insights,
which allows us to deliver
consistently exceptional outcomes
for our clients.
DIRECTORS’ REPORT
» Product Access consists of two
service offerings: On Demand and
Exclusive Access. On Demand
offers pharmacy led solutions
for sourcing and supplying
unlicensed medicines to meet the
needs of both retail and hospital
pharmacists; and Exclusive Access
offers manufacturer-led solutions
for controlling the release of
speciality medicines for specifically
approved patient populations
in agreed markets. The Group
currently delivers Product Access
solutions on a global basis.
» Supply Chain & Retail provides
both pre-wholesale distribution
and wholesale distribution of
pharmaceutical, healthcare
and animal health products
to pharmacies, hospitals and
veterinary surgeons in Ireland.
The division is an established
market leader in Ireland with c.53%
market share in the wholesale/
hospital market, supported by a
network of 386 owned, franchised
and symbol group pharmacies
(excluding the acquisition of the
McCauley Pharmacy Group).
The business supports the diverse
customer base, through the
provision of strong service
levels, coupled with innovative
commercial initiatives. Supply
Chain & Retail is an Irish only
business for the Group, although
the manufacturer relationships
and infrastructure are utilised for
the benefit of the growth divisions,
Commercial & Clinical and
Product Access.
The three trading divisions work
in synergy, to allow us to support
healthcare professionals and
manufacturer customers to provide
their patients and communities
with the medicines and care that
they need.
Business Review
Our business performed strongly in
2022, demonstrating the diversity
of the Group’s service offering,
the strength of our teams and
the continued focus on providing
technology driven solutions.
This strong result was against
the backdrop of a challenging
macroeconomic environment.
Gross profit increased to €306.7m
from €274.5m, which was a rise of
11.7%. The increase was achieved
through our acquisitions, completed
in 2021 and 2022, together with
organic gross profit growth of 5.7%.
During 2022, the Group continued its
strategy of expanding its geographic
footprint and market share and
completed three acquisitions,
with a fourth, the acquisition of the
McCauley Pharmacy Group receiving
CCPC approval in January 2023.
These acquisitions led to an increase
in the Group’s goodwill of €59.3m
to €483.0m. The acquisitions were
spread over our three divisions.
The Commercial & Clinical Division
acquired Inspired Health in the
Pharma business unit. Product
Access continued its expansion with
the addition of BModesto Group
and Orspec Pharma to the division.
Supply Chain & Retail announced
the acquisition of the McCauley
Pharmacy Group, which was subject
to CCPC approval at December
2022 and was subsequently
approved and acquired in January
2023. Acquisitions completed in
2021, including CoRRect Medical,
BESTMSLs Group, E4H and
Devonshire Healthcare Services
have all been successfully integrated
into the business and are adding
significant value to the Group,
with previously identified synergies
coming through.
104
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS Strong cash generation continues
across the Group, and this is reflected
in the cash generated from operating
activities of €82.8m. Free cash flow
conversion for the period was 82.5%,
exceeding the medium-term free cash
flow conversion target of 60-70%.
The Group renewed its banking
facility in August 2022 and more than
doubled the revolving credit facility
(RCF) to €400m, with an additional
uncommitted accordion facility of
€150m. As part of the renewal, three
new international banking partners,
Barclays Bank, ING Bank and Citizens
Bank, have joined the banking
syndicate. This new enlarged facility
further strengthens the banking
platform to support the Group’s future
growth and investment. Net bank
debt was €91.2m (2021: €48.3m)
and leverage remained low at 1.0x,
providing a solid platform to support
future growth and investment as
opportunities arise.
The Group has a number of key
performance indicators (KPIs) which
are used to monitor its performance.
These KPIs are outlined further in our
key performance indicators section
on pages 23 to 24.
Acquisitions
We continue to leverage M&A to
support our objectives and, in 2022,
we completed three acquisitions,
with the fourth, the McCauley
Pharmacy Group, receiving CCPC
approval in January 2023 and closing
then. Acquisitions completed in
2021, including CoRRect Medical,
BESTMSLs Group, E4H and
Devonshire Healthcare Services
have all been successfully integrated
into the business and are adding
significant value.
BModesto Group will play an
important role in further scaling
our European presence and the
acquisition gives the Group a well-
located facility in the Netherlands
from which to supply mainland
Europe. The BModesto Group
provides a wide range of services,
including the distribution of medicines
on both an exclusive and on-demand
basis, clinical trial services, market
authorisation holder and medical
device distribution.
Orspec Pharma, headquartered in
Australia, provides the Group with
its first physical presence in Asia
Pacific. Orspec Pharma specialises
in the supply of unlicensed medicines
and the delivery of EAPs across the
Asia Pacific region from its locations
in Australia, New Zealand and
Singapore. Orspec Pharma expands
our global reach and our capability to
offer Expanded Access Programmes
on a global basis.
Commercial & Clinical acquired
Inspired Health, a US based
healthcare insights consultancy
business enabling the Pharma
business unit to evolve its
commercialisation offering to enhance
its clients’ competitiveness and
improve healthcare delivery.
These acquisitions represent further
development in the delivery of
Uniphar’s growth strategy.
The pre-tax exceptional loss in
2022 of €3.2m was driven largely
by non-recurring administrative
expenses offset by the release of
deferred contingent consideration.
See Note 4 for further details of
exceptional items incurred during
the year.
Results for the Year
The Group Income Statement for
the year ended 31 December 2022
and the Group Balance Sheet at
that date are set out on pages 122
and 124 respectively. The Group’s
gross profit was €306,744,000
(2021: €274,497,000) and earnings
before interest, tax, depreciation,
amortisation and exceptional
items (EBITDA) was €98,040,000
(2021: €86,481,000).
The Group’s profit on ordinary
activities before tax was €54,676,000
in 2022 (2021: €55,801,000).
After including a tax expense of
€8,970,000 (2021: €7,679,000) and
profit attributable to non-controlling
interests of €119,000 (2021: €45,000),
the profit for the financial year
attributable to owners is €45,587,000
(2021: €48,077,000).
There was a strong cash performance
in 2022, and even with the Group’s
significant investment in infrastructure
and strategic acquisitions during
the year, the strong free cash flow
performance places the Group in
a position of strength with a low
leverage of 1.0x and net bank debt of
€91.2m at year end.
Total equity of the Group at
31 December 2022 was €289,783,000
(2021: €251,564,000).
Research and Development
The Group performs research
and development activities to
ensure that it continues to be a
recognised innovator in the industry
in which it operates. These activities
support the introduction of new
services, improved online customer
experience and the development
of better processes and systems.
Continued research and development
contributes to the Group’s future
growth and profitability. Expenditure
on research and development
applications and technical support
amounted to €324,000 in 2022
(2021: €284,000).
Future Developments
Uniphar remains confident in
delivering on expectations set at our
IPO and the Group’s medium-term
organic gross profit growth targets at
a divisional level remain unchanged.
We have a robust plan in place
across the three divisions and we
remain committed to building a pan-
European offering in our Commercial
& Clinical Division, in addition to
providing bespoke services in the US.
In Product Access, we will continue
to develop our On Demand and
Expanded Access Program services,
investing in digital technology and
scalable infrastructure, expanding
into new regions beyond Europe and
the US. In Supply Chain & Retail, we
continue to leverage our key assets
and grow our market share.
M&A will continue to play an
important part in Uniphar’s growth
strategy, and we will continue to have
a disciplined approach and manage
an active pipeline of acquisition
opportunities to add further
scale and breadth to the existing
platform. The management team
are committed to maximising the full
potential of our recent acquisitions
and delivering long-term value for all
our stakeholders.
Statement of
Directors’ Responsibilities
The Directors are responsible for
preparing the Directors’ Report and
the financial statements of the Group
and Company, in accordance with
Irish law.
Irish law requires the Directors to
prepare financial statements for
each financial year. Under that
law, the Directors have elected to
prepare Group financial statements
in accordance with International
Financial Reporting Standards
(IFRSs), as adopted by the European
Union and Article 4 of the IAS
Regulation and have also chosen to
prepare the parent company financial
statements under IFRSs, as adopted
by the European Union.
Under Irish law, the Directors shall
not approve the financial statements
unless they are satisfied that they give
a true and fair view of the Group’s
and Company’s assets, liabilities, and
financial position as at the end of the
financial year and the profit or loss
of the Group and Company for the
financial year.
In preparing these financial
statements, the Directors are
required to:
» Select suitable accounting policies
and then apply them consistently
» Make judgements and estimates
that are reasonable and prudent
» State whether the financial
statements have been prepared in
accordance with IFRS and ensure
that the financial statements
contain the additional information
required by the Companies
Act 2014
» Prepare the financial statements on
the going concern basis unless it is
inappropriate to presume that the
Group and Company will continue
in business
The Directors are responsible for
keeping adequate accounting records
that are sufficient to:
» Correctly record and explain
the transactions of the Group
and Company
» Enable, at any time, the assets,
liabilities, financial position and
profit or loss of the Group and
Company to be determined with
reasonable accuracy
» Enable the Directors to ensure that
the financial statements comply
with the Companies Act 2014 and
enable those financial statements
to be audited
The Directors are also responsible
for safeguarding the assets of the
Group and the Company and, hence,
for taking reasonable steps for the
prevention and detection of fraud and
other irregularities.
Directors’ Compliance Statement
The Directors acknowledge that
they are responsible for securing
the Company’s compliance with its
relevant obligations, as defined in the
Companies Act 2014 (the ‘Relevant
Obligations’)
The Directors confirm that:
1) A compliance policy statement
setting out the Company’s policies
in respect of compliance by
the Company with its relevant
obligations has been drawn up
2) Appropriate arrangements or
structures that are designed to
secure material compliance with
the Company’s relevant obligations
have been put in place
3) A review of the arrangements and
structures, referred to in point (2)
above has been conducted during
the year ended 31 December 2022
Each of the Directors confirm that
they consider the Annual Report and
Consolidated Financial Statements,
taken as a whole, is fair, balanced
and understandable and provides
the information necessary for
shareholders to assess the Group
and Company position, performance,
business model and strategy.
Audit, Risk and
Compliance Committee
In accordance with Section 167
of the Companies Act 2014,
the Group has established an Audit,
Risk and Compliance Committee.
Full particulars are provided in
the Audit, Risk and Compliance
Committee Report at pages 81 to 86.
The Directors are responsible for
the maintenance and integrity of the
corporate and financial information
included on the Company’s website.
Legislation in Ireland governing the
preparation and dissemination of
financial statements may differ from
legislation in other jurisdictions.
Corporate Governance
Statements by the Directors in
relation to the Group and Company’s
application of corporate governance
principles and the Group’s system
of internal controls are set out in the
Corporate Governance Report at
pages 72 to 80.
Disclosure of Information to Auditors
The Directors in office at the date of
this report have each confirmed that:
» Insofar as they are aware, there
is no relevant audit information of
which the Company’s statutory
auditor is unaware
» They have taken all the steps
that they ought to have taken
as a Director, in order to make
themselves aware of any relevant
audit information and to establish
that the Company’s statutory
auditor is aware of that information
Going Concern
The Directors have made appropriate
enquiries and carried out a thorough
review of the Group’s forecasts,
projections, and available banking
facilities, taking account of possible
changes in trading performance and
considering business risk.
Uniphar plays a significant role in the
healthcare sector, ensuring continuity
in the supply and distribution of much
needed medicines, medical devices
and related services.
105
106
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
The Group has a robust capital
structure with strong liquidity,
supported into the future by the
banking facility, with a remaining term
until August 2027 (with two options
to extend by a further one year).
Having regard to the factors outlined
above and noting the financial
impact of the recently announced
acquisitions, the Directors have a
reasonable expectation that the
Group has adequate resources to
continue in operational existence
for the foreseeable future, being a
period of 12 months from the
date of approval of these financial
statements. As a result, the Directors
consider that it is appropriate to
continue to adopt the going concern
basis in preparing the financial
statements.
Viability Statement
In accordance with Provision 31 of
the 2018 UK Corporate Governance
Code, the directors are required to
assess the prospects of the Group,
explain the period over which we
have done so and state whether we
have a reasonable expectation that
the Group will be able to continue
in operation and meet liabilities
as they fall due over this period
of assessment.
The Directors have carried out a
rigorous review of the prospects of
the Group over the medium term. In
assessing the prospects of the Group
and its ability to meet its liabilities as
they fall due, the Board has taken
account of the Group’s medium
term strategic planning cycle, capital
investment plans, the business
model, and its diverse portfolio.
The Directors have also considered
the Group’s strong cash generation,
capital structure and debt facilities
in addition to the principal risks and
uncertainties detailed on pages 30
to 34. This included a consideration
of the impact of the current global
macroeconomic climate, including
cost inflation and interest rates. The
financial position of the Group, its
cash flows, liquidity position and
borrowing facilities are outlined in the
Financial Review on pages 57 to 60.
Period of Viability Assessment
The directors concluded that three
years was an appropriate period for
the assessment. Given the potential
impact of macroeconomic events and
political uncertainty, it is recognised
that future assessments are subject
to a level of uncertainty that increases
with time, and therefore future
outcomes cannot be guaranteed or
predicted with certainty, financial
projections are considered to be more
reliable and robust over this period.
Accounting Records
The measures taken by the Directors
to secure compliance with the
Group’s obligation to keep adequate
accounting records are the use of
appropriate systems and procedures
and employment of competent
persons as outlined in Sections
281 to 285 of the Irish Companies
Act 2014. The accounting records
are kept at 4045 Kingswood Road,
Citywest Business Park, Co. Dublin,
D24 V06K.
Principal Risks and Uncertainties
The principal risks and uncertainties
facing the Group and its subsidiaries
are outlined on pages 30 to 34.
Financial Risk Management
The Group’s operations expose it to
various financial risks. The Group
has a risk management programme
in place which seeks to limit the
impact of these risks on the financial
performance of the Group and it is
the policy of the Group to manage
these risks in a non-speculative
manner.
The Group’s financial risk
management is carried out by a
central finance department under
policies approved by the Board.
The Group Finance function identifies,
evaluates and manages financial
risks in close co-operation with
the Group’s operating units. The
Board approves written principles
for overall risk management, as well
as policies covering specific areas,
such as foreign exchange risk,
interest rate risk, credit risk, use of
derivative financial instruments and
non-derivative financial instruments,
and the investment of excess liquidity.
The Group uses financial instruments
throughout its business. Borrowings,
cash, and liquid resources are used
to finance the Group’s operations.
Trade receivables and payables arise
directly from operations.
Forward foreign exchange contracts
are used to manage currency risks
arising from the Group’s operations.
Assessment of Viability
The viability of the Group has been
assessed, using the Group Strategic
Plan as approved by the Board,
building upon the several divisional
management plans as well as the
Group’s strategic goals. It is based on
a number of assumptions concerning
macro growth, stability in our key
markets, and continued access
to capital to support the Group’s
ongoing investments. The strategic
plan is subject to stress testing which
involves flexing a number of the main
assumptions underlying the forecast
in severe but reasonable scenarios.
Such assumptions are tested by
management and the directors.
In making this assessment, the
directors have considered the
resilience of the Group, taking
account of its current position and
the principal risks facing the business
as outlined in the Risk Management
Report contained in this Annual
Report, and the Group’s ability to
manage those risks. The risks have
been identified using a top-down
and bottom-up approach, and their
potential impact was assessed having
regard to the effectiveness of controls
in place to manage each risk. In
assessing the prospects of the Group
such potential impacts have been
considered as have the mitigating
factors in place.
Based on this assessment and
the diverse nature of the Group’s
geographies, markets, customer
base, and product portfolio the
Directors have concluded that they
have a reasonable expectation that
the Group will be able to continue
in operation and meet its liabilities
as they fall due over the three-year
period of the assessment.
Finance Interest and Currency Risk
The Group’s procedure is to
finance operating subsidiaries by a
combination of retained profits and,
to a lesser extent, non-recourse
financing arrangements, invoice
discounting and overdrafts, and
to finance investments with a
combination of Group funds and
borrowings. The majority of the
Group’s activities are conducted in
Euro. Foreign exchange exposure
arises from transactional currency
exposures arising from the sale and
purchase of goods in currencies
other than the Group’s functional
currency (the Euro). The Group takes
appropriate measures to manage
its exposure to fluctuating foreign
exchange rates associated with both
transaction activity and the translation
into Euro of its net investment
in its non-Euro subsidiaries.
Forward foreign exchange contracts
and the holding of foreign currency
cash balances are used to hedge
these currency exposures, where
material.
Non-Financial Reporting Statement
Pursuant to the European Union
(Disclosure of Non-Financial and
Diversity Information by certain large
undertakings and groups) Regulations
2017 (‘Regulations’), the Group
is required to report on certain
non-financial information to provide
an understanding of its development,
performance, position and the impact
of its activities, relating to, at least,
environmental matters, social matters,
employee matters, respect for human
rights, and bribery and corruption.
The table below provides additional
detail on the information required
to be provided by the Regulations
and highlights where the information
has been provided in this Annual
Report and Consolidated Financial
Statements, where applicable.
Reporting Requirements Our Policies
Commentary
Environmental matters
» Sustainability Policy
Social and
employee matters
» Sustainability Policy
» Code of Conduct
» Equity, Diversity & Inclusion Policy
» Whistleblower Policy
Human rights
» Code of Business Conduct
» Equity, Diversity & Inclusion Policy
» Modern Slavery Policy
Anti-bribery
and corruption
» Anti-Bribery and Corruption Policy
» Code of Conduct
» Whistleblower Policy
» Conflicts of Interest Policy
For further information on the Group’s approach
to Environmental matters, see the Environment
& Sustainability section of our Sustainability and
Governance report.
For further information on the Group’s approach
to Social and Employee matters, see the People
& Culture section of this Report and the People
& Workplace section and the Community
Involvement section of our Sustainability and
Governance report.
The Group is committed to conducting all our
activities in accordance with high standards of
business conduct, respecting the fundamental
freedoms and rights of our people. The Group
is also committed to ensuring that our supply
chain is free from human rights abuses, including
forced labour, slavery and trafficking.
The Group does not tolerate any form of bribery,
prohibits facilitation payments, and does not
make political contributions.
Description of the
business model
Details are set out in the principal activities and review of the development of the business
section of this report.
Non-financial key
performance indicators
The Group’s planning and financial reporting procedures include financial and non-
financial Key Performance Indicators (KPIs) which benchmark progress towards our
strategic priorities. KPIs are reviewed and monitored on a regular basis by the Board,
the Audit, Risk and Compliance Committee, or the applicable business manager and
are amended to better reflect the Group’s key performance measures when required.
Our KPIs in connection with the above matters relate to the level of reported breaches of
applicable legislation or incidents reported, of which there were none in the current year.
In addition to the KPIs which are reviewed and monitored at a business level, the Group
has a number of KPIs which are used to monitor the Group’s performance. These KPIs are
outlined further in our key performance indictors section on pages 23 to 24.
Principal risks
Details are set out in the Risk Management section of this report on pages 27 to 34 and
each of the above areas are discussed where relevant.
107
108
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Key Performance Indicators
In the 2022 reporting period, Uniphar had no turnover
associated with eligible activities. The proportion of
eligible operating expenditure was deemed to be 5.5%
and eligible capital expenditure was deemed to be 7.1%.
Turnover
With no eligible turnover (numerator) and using a base
of our total turnover (denominator), as reported in our
Income Statement, we established the proportion of
eligible turnover to be zero.
Operational Expenditure
Having identified certain eligible expenditure within
this category (numerator) and using the total operating
expenditure (denominator), we established the proportion
of eligible operational expenditure to be 5.5%.
Capital expenditure
Comparing these eligible capital additions (numerator) to
our additions of intangible assets and property plant and
equipment, right of use assets as reported in Notes 10
and 11 in our financial statements (denominator), the level
of eligible additions is approximately 7.1%. This does not
include business combinations in the year.
Taxonomy Alignment
Having identified certain taxonomy eligible economic
activities, we did not identify any activities which met all of
the alignment criteria of the EU Taxonomy Regulations.
Category
Taxonomy
Eligible
Taxonomy
Aligned
Turnover
Operational Expenditure
Capital Expenditure
0%
5.5%
7.1%
0%
0%
0%
EU Taxonomy – Our Taxonomy Eligible Activities
Background
The EU Taxonomy Regulation provides a classification
system for sustainable activities, to help direct
investments towards sustainable projects and activities.
It establishes a list of sustainable economic activities
which contribute meaningfully towards several
environmental objectives. In the following section,
the Group has outlined information on the extent to which
the Group’s activities are eligible under this taxonomy.
Uniphar acknowledges the emergence of this new
regulation and has therefore adopted a conservative
approach in calculating the KPIs below.
Economic Activity
In assessing eligibility, we looked at the activities of
the Group and whether these fall within the scope of
the economic activities outlined under the taxonomy
regulation. Uniphar’s core business includes the supply
of pharmaceutical and medical device products, which are
not currently listed as eligible activities.
To support our core business activities, we carry out some
ancillary services and we have looked at our investment
in these areas to understand if these qualify as eligible.
Accounting Policies
Turnover
While the supply of pharmaceutical and medical device
products was deemed non-eligible we reviewed the
Group’s divisions against those economic activities
currently within the scope of the taxonomy regulation and,
through this assessment, we determined that Uniphar had
no eligible turnover in 2022.
Operational Expenditure
While the majority of our Operating Expenditure relates
to non-eligible turnover, we have identified certain
categories of operating expenditure which fall within the
taxonomy eligible categories, in particular 6.5 Transport by
motorbikes, passenger cars and light commercial vehicles
and 6.6 Freight transport services by road.
Capital expenditure
Our assessment was on investment in eligible economic
activities listed within the regulation. This included
projects involving building renovations to improve existing
distribution facilities and the installation, maintenance
and repair of energy efficiency equipment. Projects were
allocated to distinct categories to avoid double counting
and, going forward, capital projects and associated
purchases will include more detailed assessment of
taxonomy alignment.
Substantial Holdings
The table below shows all notified shareholdings in excess of 3% of the issued ordinary share capital of the Company
as at 31 December 2022 and 22 February 2023, being the closest possible date to the date of signing of this report:
22 February 2023
31 December 2022
Number of shares
% Holding
Number of shares
% Holding
Mackenzie Investment
Polar Capital
Sisk Family
Allianz Global Investors
17,374,939
19,052,574
16,152,373
24,628,036
6.4%
7.0%
5.9%
9.0%
17,374,939
19,052,574
16,152,373
19,304,961
6.4%
7.0%
5.9%
7.1%
Directors, Secretary and their Interests in Shares
The names of the persons who, at any time in the twelve months to 31 December 2022, were Directors are
set out below:
M. Pratt
G. Rabbette
T. Dolphin
P. Hogan
S. Webb
J. Berkowitz
J. Gaul
L. Hoctor
The beneficial interests, including family interests, of the Directors and Company Secretary of Uniphar plc in office
at 31 December 2022 in the share capital of Uniphar plc and subsidiary undertakings were:
Ordinary shares
G. Rabbette
T. Dolphin
31 December
2022
Number
31 December
2021
Number
8,003,310
5,586,322
8,203,310
5,586,322
The Directors and secretary who hold less than 1% of the Company’s issued share capital are not disclosed, as the
Company is exempt under Section 260, Companies Act 2014. For further details on Director’s share awards under LTIP
schemes, see the Remuneration Committee Report.
Political Donations
The Electoral Act 1997, (as amended
by the Electoral Political Funding Act
2012) requires companies to disclose
all political donations to any individual
party over €200 in value made during
the financial year. The Directors, on
enquiry, have satisfied themselves
that no such donations in excess of
this amount have been made by the
Group or any of its subsidiaries.
Events after the Balance Sheet Date
The Group completed the acquisition
of McCauley’s Pharmacy Group in
January 2023. This acquisition was
announced in 2022, but was subject
to CCPC review at the Balance
Sheet date.
There have been no other material
events subsequent to 31 December
2022 that would require adjustment
to or disclosure in this report.
Dividends
Following another set of positive
results for the Group, the Directors
are proposing a final dividend of
€3.1m. Together with the interim
dividend of €1.7m, paid in October
2022, this brings the total dividend
for the year to €4.8m, which is an
increase of 4.8% on 2021. Subject to
approval at the AGM, the proposed
dividend will be paid to ordinary
shareholders on the Company’s
register at 5pm on 21 April 2023.
The Board intends to adopt a
progressive dividend policy, to
reflect the expectation of future cash
flow generation and the long-term
earnings potential of the Group.
Auditors
The independent auditors, PwC, have
indicated their willingness to continue
in office.
On behalf of the Board
Maurice Pratt
Gerard Rabbette
109
110
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
Commercial & Clinical
Product Access
Supply Chain & Retail
FINANCIAL STATEMENTS
Enabling
Consistent
Growth
113
122
Independent Auditors’ Report
Group Income Statement
Group Statement of
123
Comprehensive Income
124
Group Balance Sheet
125
Company Balance Sheet
126
Group Cash Flow Statement
127
Company Cash Flow Statement
Group Statement of Changes in Equity
128
Company Statement of Changes in Equity 129
130
Accounting Policies
142
Notes to the Financial Statements
207
Alternative Performance Measures
212
Glossary of Terms
111
112
UNIPHAR PLC ANNUAL REPORT 2022 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
Report on the audit of the financial statements
Opinion
In our opinion, Uniphar plc’s group financial statements and company financial statements (the ‘financial statements’):
» give a true and fair view of the group’s and the company’s assets, liabilities and financial position as at
31 December 2022 and of the group’s profit and the group’s and the company’s cash flows for the year then ended;
» have been properly prepared in accordance with International Financial Reporting Standards (‘IFRSs’) as adopted
by the European Union and, as regards the company’s financial statements, as applied in accordance with the
provisions of the Companies Act 2014; and
» have been properly prepared in accordance with the requirements of the Companies Act 2014.
We have audited the financial statements, included within the Annual Report, which comprise:
» the Group and Company Balance Sheets as at 31 December 2022;
» the Group Income Statement for the year then ended;
» the Group Statement of Comprehensive Income for the year then ended;
» the Group and Company Cash Flow Statements for the year then ended;
» the Group and Company Statements of Changes in Equity for the year then ended;
» the Accounting Policies; and
» the notes to the financial statements.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (Ireland) (‘ISAs (Ireland)’) and applicable
law. Our responsibilities under ISAs (Ireland) are further described in the Auditors’ responsibilities for the audit of
the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We remained independent of the group in accordance with the ethical requirements that are relevant to our audit of the
financial statements in Ireland, which includes IAASA’s Ethical Standard as applicable to listed entities, and we have
fulfilled our other ethical responsibilities in accordance with these requirements.
Our audit approach
Overview
Materiality
Overall materiality
» €2.75 million (2021: €2.5 million) – Group financial statements.
» Based on c. 5% of profit before tax, before exceptional items.
» €2.5 million (2021: €2.8 million) – Company financial statements.
» Based on c. 1% of net assets.
Audit
scope
Performance materiality
» €2.1 million (2021: €1.9 million) – Group financial statements.
» €1.8 million (2021: €2.1 million) – Company financial statements.
Key audit
matters
Audit scope
» The Group has three operating segments: Commercial & Clinical, Product
Access and Supply Chain & Retail. Each of these consists of a number of
reporting components.
» We performed full scope audits of the complete financial information of six
reporting components, which in our view required an audit of their complete
financial information due to their size and financial significance or risk factors to
the group.
» These components account for in excess of 80% of Revenues, in excess of 70%
of Profit before tax before exceptional items and in excess of 80% of Total assets
of the group.
» In addition, specified audit procedures on selected account balances, classes of
transactions or disclosures were performed at sixteen other reporting components
within the group.
Key audit matters
» Goodwill impairment assessment.
» Accounting for material acquisitions.
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements. In particular, we looked at where the directors made subjective judgements, for example in respect
of significant accounting estimates that involved making assumptions and considering future events that are inherently
uncertain. As in all of our audits we also addressed the risk of management override of internal controls, including
evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due
to fraud.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the
audit of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) identified by the auditors, including those which had the greatest effect on:
the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of
our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. This is not a complete list of all risks identified by our audit.
113
114
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
Key audit matter
How our audit addressed the key audit matter
Key audit matter
How our audit addressed the key audit matter
Goodwill impairment assessment
Refer to ‘Intangible assets’ and ‘Impairment of assets’
on pages 132 and 133 (Accounting policies), ‘Impairment
assessment of goodwill and other non-current assets’
in Note 1 (‘Significant estimates and judgements’) and
note 10 (‘Intangible Assets’).
The carrying value of goodwill at 31 December 2022 is c.
€483m, representing approximately 43% of the group’s
total assets.
The carrying amount of goodwill attributed to each Cash
Generating Unit (‘CGU’) is tested for impairment annually,
or more frequently if events or changes in circumstances
indicate that it might be impaired.
As set out in Note 10 management concluded there were
no impairments in the year.
We determined this to be a key audit matter due to
the level of judgement required by management in
determining the recoverable amount of goodwill, and the
assumptions used in the calculation of its value-in-use.
Key assumptions used to develop the estimation of
value-in-use at 31 December 2022 include the growth
rates for revenue, cost inflation, terminal growth values
and the discount rates.
We considered management’s impairment model for each
CGU and evaluated the methodology used and the key
assumptions therein. We also tested the mathematical
accuracy of the impairment models.
We agreed the cash flow forecasts for 2023 to 2027 to
Board approved plans.
We assessed the reasonableness of estimates of future
revenue and costs included in the cash flow forecasts
by evaluating relevant assumptions with reference to
historical performance and current market conditions.
We evaluated the discount rates and terminal growth
rates used by management, with the assistance of PwC
valuation experts.
We also performed a sensitivity analysis using alternative
reasonably possible assumptions for estimating the
value-in-use.
Based on the results of our procedures we were satisfied
that no impairment charge was required.
We also assessed the appropriateness of the disclosures
in Note 10 regarding the impairment assessment
of goodwill.
Accounting for material acquisitions
Refer to ‘Business combinations’ on pages 135 and
136 (Accounting policies), ‘Business combinations’ and
‘Provisions’ under note 1 (‘Significant estimates and
judgements’), Note 19 (‘Provisions’), note 10 (‘Intangible
Assets’) and Note 35 (‘Acquisitions of subsidiary
undertakings and business assets’).
The group completed ten acquisitions during the year.
Management determined that all acquisitions met the
definition of a business combination under IFRS 3
‘Business Combinations’. For three of the acquisitions the
total consideration includes an estimate for consideration
that is contingent on future trading performance.
Management also considered the appropriateness of
the recognition of intangible assets, other than goodwill,
on acquisitions made during the year and in the
finalisation of the provisional fair value of intangibles on
prior year acquisitions. As set out in Note 10, goodwill
of €61m was recognised in the year of which €48.1m
relates to the three acquisitions referred to in the previous
paragraph. No intangible assets have been recognised
other than a technology platform asset recognised of
€2.1m on finalisation of provisional fair value of assets
on acquisitions in 2021.
We determined the accounting for the significant
acquisitions to be a key audit matter due to their
significance to the financial statements and the judgement
involved in determining the fair value of the deferred
contingent consideration payable which is based on
achievement of specified future profitability targets.
Management’s assessment in relation to these targets is
a significant assumption.
We read the legal agreements for each acquisition to
obtain an understanding of the structure and key terms of
each acquisition.
We challenged the reasonableness of the significant
assumptions used in the measurement of the fair value
of the deferred contingent consideration, pertaining
to the three acquisitions. This included considering
management’s assessment of the likelihood of the
specified future profitability targets being achieved,
including considering the growth rates used against OECD
published economic forecasts for the region in which each
acquired entity operates and other relevant factors.
We also assessed, with the assistance of a PwC
valuations expert, the discount rate applied.
We challenged management regarding the existence of
intangible assets, other than goodwill, in respect of the
acquisitions made during the year and the finalisation
of provisional fair values on prior year acquisitions. This
included considering management’s assessment of the
nature of the acquisitions made.
We found that the assumptions used in the measurement
of both the deferred consideration and the recognition of
intangible assets fell within a reasonable range.
We also assessed the appropriateness of the disclosures
in the financial statements.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the
financial statements as a whole, taking into account the structure of the group, the accounting processes and controls,
and the industry in which the group operates.
The group is structured along three operating segments being Commercial & Clinical, Product Access and Supply Chain
& Retail. Each operating segment comprises a number of reporting components. The group financial statements are a
consolidation of 61 reporting components across the three operating segments. In establishing the overall approach to
the Group audit, we identified six reporting components, which in our view required an audit of their complete financial
information due to their size and financial significance or risk factors to the group. These components account for in
excess of 80% of Revenues, in excess of 70% of Profit before tax before exceptional items and in excess of 80% of
Total assets of the group. In addition, specified audit procedures on selected account balances, classes of transactions
or disclosures were performed at sixteen other reporting components within the group.
This together with the work we performed at group over central functions, IT systems and areas of judgement including
the key audit matters noted above, taxation and business combinations gave us the comfort we required in respect of
our audit of the financial statements. All audit procedures were performed directly by the group team.
115
116
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and
in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Group financial statements
Company financial statements
Overall materiality
€2.75 million (2021: €2.5 million).
€2.5 million (2021: €2.8 million).
How we determined it
c. 5% of profit before tax, before
exceptional items.
c. 1% of net assets.
Rationale for
benchmark applied
The group is profit-oriented and
profit before tax before exceptional
items is one of the key metrics
used by shareholders in reviewing
the performance of the group.
Consequently, we consider this to
be the most appropriate relevant
performance metric.
We consider net assets to be the
appropriate benchmark given the
company is a holding company with its
main activity being the management of
investments in subsidiaries.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected
and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining
the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and
disclosures, for example in determining sample sizes. Our performance materiality was 75% of overall materiality,
amounting to €2.1 million (group audit) and €1.8 million (company audit).
In determining the performance materiality, we considered a number of factors – the history of misstatements,
risk assessment and aggregation risk and the effectiveness of controls – and concluded that an amount at the upper
end of our normal range was appropriate.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit
above €0.1 million (group audit) (2021: €0.1 million) and €0.1 million (company audit) (2021: €0.1 million) as well as
misstatements below that amount that, in our view, warranted reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment of the group and company’s ability to continue to adopt the going concern
basis of accounting included:
» Obtaining management’s going concern assessment and evaluating the budgets and forecasts for the going concern
assessment period and challenging the key assumptions. In evaluating these forecasts we considered the group’s
historic performance, current market conditions and the Board approved future expected capital expenditure;
» Testing the mathematical integrity of the budgets and forecasts and the models and reconciling these to Board
approved budgets;
» Considering whether the assumptions underlying the budgets and forecasts were consistent with related
assumptions used in testing for goodwill impairment;
» Evaluating the sensitivity analysis prepared by management to assess appropriate downside scenarios; and
» Considering the group’s available financing facilities and maturity profile of the group’s debt to assess liquidity
through the going concern assessment period.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on the group’s or the company’s ability to continue as a going
concern for a period of at least twelve months from the date on which the financial statements are authorised for issue.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the
group’s or the company’s ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant
sections of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our
auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial statements
does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent
otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency
or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement
of the financial statements or a material misstatement of the other information. If, based on the work we have
performed, we conclude that there is a material misstatement of this other information, we are required to report that
fact. We have nothing to report based on these responsibilities.
With respect to the Directors’ Report, we also considered whether the disclosures required by the Companies Act 2014
(excluding the information included in the ‘Non Financial Statement’ as defined by that Act on which we are not required
to report) have been included.
Based on the responsibilities described above and our work undertaken in the course of the audit, ISAs (Ireland) and the
Companies Act 2014 require us to also report certain opinions and matters as described below:
» In our opinion, based on the work undertaken in the course of the audit, the information given in the Directors’ Report
(excluding the information included in the ‘Non Financial Statement’ on which we are not required to report) for the
year ended 31 December 2022 is consistent with the financial statements and has been prepared in accordance with
the applicable legal requirements.
» Based on our knowledge and understanding of the group and company and their environment obtained in the course
of the audit, we have not identified any material misstatements in the Directors’ Report (excluding the information
included in the ‘Non Financial Statement’ on which we are not required to report).
Corporate Governance Statement
As a result of the directors’ voluntary reporting on how they have applied the UK Corporate Governance Code, we are
required by ISAs (Ireland) to review the directors’ statements in relation to going concern, longer-term viability and
that part of the Corporate Governance Statement relating to the company’s compliance with the provisions of the UK
Corporate Governance Code (the ‘Code’) specified for our review. Our additional responsibilities with respect to the
Corporate Governance Statement as other information are described in the Reporting on other information section
of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
Corporate Governance Statement is materially consistent with the financial statements and our knowledge obtained
during the audit and we have nothing material to add or draw attention to in relation to:
» The directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks;
» The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify
emerging risks and an explanation of how these are being managed or mitigated;
» The directors’ statement in the financial statements about whether they considered it appropriate to adopt the going
concern basis of accounting in preparing them, and their identification of any material uncertainties to the group’s
and company’s ability to continue to do so over a period of at least twelve months from the date of approval of the
financial statements;
» The directors’ explanation as to their assessment of the group’s and company’s prospects, the period this
assessment covers and why the period is appropriate; and
» The directors’ statement as to whether they have a reasonable expectation that the company will be able to
continue in operation and meet its liabilities as they fall due over the period of its assessment, including any related
disclosures drawing attention to any necessary qualifications or assumptions.
117
118
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
Our review of the directors’ statement regarding the longer-term viability of the group was substantially less in
scope than an audit and only consisted of making inquiries and considering the directors’ process supporting their
statement; checking that the statement is in alignment with the relevant provisions of the UK Corporate Governance
Code; and considering whether the statement is consistent with the financial statements and our knowledge and
understanding of the group and company and their environment obtained in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements
of the Corporate Governance Statement is materially consistent with the financial statements and our knowledge
obtained during the audit:
» The directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and
understandable, and provides the information necessary for the members to assess the group’s and company’s
position, performance, business model and strategy;
» The section of the Annual Report that describes the review of effectiveness of risk management and internal
control systems; and
» The section of the Annual Report describing the work of the Audit Committee.
We have nothing to report in respect of our responsibility to report when the directors’ statement relating to the
company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code
specified under the Listing Rules for review by the auditors.
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors’ Responsibilities set out on page 106, the directors are responsible
for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that
they give a true and fair view.
The directors are also responsible for such internal control as they determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group’s and the company’s ability
to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the group or the company or to cease operations,
or have no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the group and industry, we identified that the principal risks of non-compliance with
laws and regulations related to applicable healthcare regulations and competition law, and we considered the extent
to which non-compliance might have a material effect on the financial statements. We also considered those laws and
regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2014
and relevant tax legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation of
the financial statements (including the risk of override of controls), and determined that the principal risks were related
to posting manual journal entries to manipulate financial performance, management bias through judgements and
assumptions in significant accounting estimates and management bias in judgements applied in significant one-off
or unusual transactions. Audit procedures performed by the engagement team included:
» Discussions with the Audit Risk & Compliance Committee, the Company Secretary, members of the Quality team,
other senior members of management and internal audit, including consideration of known or suspected instances
of non-compliance with laws and regulations and fraud;
» Inspection of meeting minutes of the Board and the Audit Risk & Compliance Committee;
» Consideration of legal expense accounts to identify significant legal spend that may be indicative of non-compliance
with laws and regulations arising from irregularities, including fraud;
» Identifying and testing journal entries, including non standard revenue entries based on our risk assessment;
» Challenging assumptions and judgements made by management in determining significant accounting estimates
(because of the risk of management bias) in particular in relation to the key audit matters noted above; and
» Incorporating elements of unpredictability into the audit procedures performed.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the
financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data
auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing
complete populations. We will often seek to target particular items for testing based on their size or risk characteristics.
In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the
sample is selected.
A further description of our responsibilities for the audit of the financial statements is located on the IAASA website at:
https://www.iaasa.ie/getmedia/b2389013-1cf6-458b-9b8f-a98202dc9c3a/Description_of_auditors_responsibilities_
for_audit.pdf
This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body in
accordance with section 391 of the Companies Act 2014 and for no other purpose. We do not, in giving these opinions,
accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in writing.
119
120
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF UNIPHAR PLC continued
GROUP INCOME STATEMENT
Year Ended 31 December 2022
Other required reporting
Companies Act 2014 opinions on other matters
» We have obtained all the information and explanations which we consider necessary for the purposes of our audit.
» In our opinion the accounting records of the company were sufficient to permit the company financial statements to
be readily and properly audited.
» The Company Balance Sheet is in agreement with the accounting records.
Other exception reporting
Directors’ remuneration and transactions
Under the Companies Act 2014 we are required to report to you if, in our opinion, the disclosures of directors’
remuneration and transactions specified by sections 305 to 312 of that Act have not been made. We have no
exceptions to report arising from this responsibility.
Prior financial year Non Financial Statement
We are required to report if the company has not provided the information required by Regulation 5(2) to 5(7) of the
European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups)
Regulations 2017 in respect of the prior financial year. We have nothing to report arising from this responsibility.
Damian Byrne
for and on behalf of PricewaterhouseCoopers
Chartered Accountants and Statutory Audit Firm
Dublin
27 February 2023
» The maintenance and integrity of the Uniphar plc website is the responsibility of the directors; the work carried
out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the financial statements since they were initially presented
on the website.
» Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
121
2022
Pre-
exceptional
€’000
2022
Exceptional
(Note 4)
€’000
Notes
2022
Total
€’000
2021
Pre-
exceptional
€’000
2021
Exceptional
(Note 4)
€’000
2021
Total
€’000
2
2,070,669
–
2,070,669
1,943,149
(1,763,925)
– (1,763,925)
(1,668,652)
306,744
(70,055)
–
–
306,744
(70,055)
274,497
(60,712)
–
1,943,149
– (1,668,652)
–
–
274,497
(60,712)
(167,275)
(16,415)
(183,690)
(154,471)
(14,404)
(168,875)
156
–
156
237
–
237
69,570
(16,415)
53,155
59,551
(14,404)
45,147
(11,670)
13,191
1,521
(9,107)
19,761
10,654
57,900
(10,076)
(3,224)
1,106
54,676
(8,970)
50,444
(8,456)
5,357
777
55,801
(7,679)
3
6
7
Revenue
Cost of sales
Gross profit
Selling and distribution costs
Administrative expenses
Other operating income
Operating profit
Finance (cost)/income
Profit before tax
Income tax expense
Profit for the financial year
47,824
(2,118)
45,706
41,988
6,134
48,122
Attributable to:
Owners of the parent
Non-controlling interests
27
Profit for the financial year
Attributable to:
Continuing operations
Profit for the financial year
Earnings per ordinary share (in cent):
Continuing operations
Basic and diluted earnings per share
(in cent)
8
45,587
119
45,706
45,706
45,706
16.7
16.7
48,077
45
48,122
48,122
48,122
17.8
17.8
122
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS GROUP STATEMENT OF COMPREHENSIVE INCOME
Year Ended 31 December 2022
GROUP BALANCE SHEET
As at 31 December 2022
Notes
2022
€’000
2021
€’000
Notes
2022
€’000
2021
€’000
(3,356)
6,464
Property, plant and equipment, and right-of-use assets
Financial assets – Investments in equity instruments
Profit for the financial year
45,706
48,122
Other comprehensive income
Items that may be reclassified to the Income Statement:
Unrealised foreign currency translation adjustments
Items that will not be reclassified to the Income Statement:
Actuarial loss in respect of defined benefit pension schemes
20
–
(9)
Total comprehensive income for the financial year
42,350
54,577
Attributable to:
Owners of the parent
Non-controlling interests
27
42,231
119
54,532
45
Total comprehensive income for the financial year
42,350
54,577
Attributable to:
Continuing operations
Total comprehensive income for the financial year
42,350
54,577
42,350
54,577
ASSETS
Non-current assets
Intangible assets – goodwill
Intangible assets – other assets
Deferred tax asset
Other receivables
Total non-current assets
Current assets
Inventory
Trade and other receivables
Cash and cash equivalents
Assets held for sale
Total current assets
Total assets
EQUITY
Capital and reserves
Called up share capital presented as equity
Share premium
Share based payment reserve
Other reserves
Retained earnings
Attributable to owners
Attributable to non-controlling interests
Total equity
LIABILITIES
Non-current liabilities
Borrowings
Provisions
Lease obligations
Total non-current liabilities
Current liabilities
Borrowings
Lease obligations
Trade and other payables
Corporation tax
Total current liabilities
Total liabilities
Total equity and liabilities
10
10
11
12
13
16
15
16
17
14
23
24
28
25
26
27
18
19
21
18
21
22
482,981
24,459
166,628
25
9,020
509
423,643
22,968
152,491
25
1,734
388
683,622
601,249
157,656
164,212
103,704
1,600
427,172
1,110,794
21,841
176,501
718
2,008
88,476
112,407
151,778
78,025
1,600
343,810
945,059
21,841
176,501
183
5,364
47,555
289,544
251,444
239
120
289,783
251,564
187,431
94,060
105,919
387,410
7,490
14,315
407,206
4,590
433,601
821,011
1,110,794
124,601
90,401
104,720
319,722
1,721
14,358
357,694
–
373,773
693,495
945,059
124
123
On behalf of the Board
M. Pratt
G. Rabbette
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
COMPANY BALANCE SHEET
As at 31 December 2022
GROUP CASH FLOW STATEMENT
Year Ended 31 December 2022
Notes
2022
€’000
2021
€’000
Notes
2022
€’000
2021
€’000
ASSETS
Non-current assets
Intangible assets
Property, plant and equipment, and right-of-use assets
Financial assets – Investments in subsidiaries
Financial assets – Investments in equity instruments
Deferred tax asset
Other receivables
Total non-current assets
Current assets
Trade and other receivables
Amounts due from subsidiaries
Cash and cash equivalents
Total current assets
Total assets
EQUITY
Capital and reserves
Called up share capital presented as equity
Share premium
Share based payment reserve
Other reserves
Retained earnings
Total equity
LIABILITIES
Non-current liabilities
Borrowings
Provisions
Lease obligations
Total non-current liabilities
Current liabilities
Lease obligations
Amounts owed to subsidiaries
Trade and other payables
Total current liabilities
Total liabilities
Total equity and liabilities
10
11
12
12
13
16
16
16
17
23
24
28
25
26
18
19
21
21
22
22
3,115
37,959
1,519
41,228
335,489
291,500
25
2,092
244
25
1,871
202
378,924
336,345
1,485
284,306
2,761
288,552
667,476
1,223
266,428
2,105
269,756
606,101
21,841
176,501
718
60
21,841
176,501
183
60
66,468
76,367
265,588
274,952
187,431
124,601
2,462
38,283
2,428
41,230
228,176
168,259
3,836
147,060
22,816
173,712
401,888
667,476
3,804
143,015
16,071
162,890
331,149
606,101
The loss recorded in the financial statements of the Company for the year ended 31 December 2022 was €5,233,000
(profit in 2021: €21,332,000). As permitted by Section 304 of the Companies Act 2014, the Income Statement of the
Company has not been separately presented in the financial statements.
On behalf of the Board
M. Pratt
G. Rabbette
125
Operating activities
Cash inflow from operating activities
Proceeds from non-recourse financing
Payment of deferred contingent consideration
Interest paid
Interest paid on lease liabilities
Corporation tax payments
Net cash inflow from operating activities
Investing activities
Payments to acquire property, plant and equipment – Maintenance
Payments to acquire property, plant and equipment – Strategic projects
Receipts from disposal of property, plant and equipment
Payments to acquire intangible assets – Maintenance
Payments to acquire intangible assets – Strategic projects
Receipts from disposal of assets held for sale
Payments to acquire subsidiary undertakings (net of cash acquired)
Repayment of debt acquired on acquisition of subsidiary undertakings
(Payments)/receipts on prior year acquisitions
Payment of deferred and deferred contingent consideration
Receipt of deferred consideration receivable
Net cash outflow from investing activities
Financing activities
Proceeds from borrowings
Repayments of borrowings
Decrease in invoice discounting facilities
Movement in restricted cash
Payment of dividends
Principal element of lease payments
Acquisition of further equity in subsidiaries
Net cash inflow from financing activities
Increase in cash and cash equivalents in the year
Foreign currency translation on cash and cash equivalents
Opening balance cash and cash equivalents
Closing balance cash and cash equivalents
29
32
21
14
30
30
17
17
82,704
15,000
–
(5,197)
(3,644)
(6,032)
82,831
(8,299)
(5,657)
128
(3,448)
(2,517)
–
(67,248)
(9,420)
(937)
(9,282)
348
68,376
–
(1,250)
(3,118)
(3,772)
(8,059)
52,177
(8,795)
(1,730)
35
(3,904)
–
350
(26,567)
(352)
3,428
(12,323)
200
(106,332)
(49,658)
98,174
(19,769)
(9,806)
–
(4,666)
(13,192)
(336)
50,405
26,904
(1,225)
78,025
42,692
(13,946)
–
3,097
(5,731)
(12,853)
–
13,259
15,778
1,837
60,410
103,704
78,025
126
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
COMPANY CASH FLOW STATEMENT
Year Ended 31 December 2022
Operating activities
Cash outflow from operating activities
Interest paid
Interest paid on lease liabilities
Net cash outflow from operating activities
Investing activities
Payments to invest in subsidiary undertakings
Receipts on prior year acquisitions
Payments to acquire intangible assets – Maintenance
Payments to acquire intangible assets – Strategic projects
Payments of deferred and deferred contingent consideration
Receipt of deferred consideration receivable
Net cash outflow from investing activities
Financing activities
Proceeds from borrowings
Repayments of borrowings
Movement in restricted cash
Payment of dividends
Principal element of lease payments
Net cash inflow from financing activities
Increase/(decrease) in cash and cash equivalents in the year
Opening balance cash and cash equivalents
Closing balance cash and cash equivalents
Notes
2022
€’000
2021
€’000
29
21
30
30
17
17
(3,303)
(3,705)
(1,316)
(8,324)
(44,152)
–
(993)
(1,144)
–
21
(46,268)
82,478
(19,648)
–
(4,666)
(2,916)
55,248
656
2,105
2,761
(16,283)
(1,881)
(1,403)
(19,567)
–
3,585
–
–
(8,147)
200
(4,362)
42,340
(13,075)
2,100
(5,731)
(2,834)
22,800
(1,129)
3,234
2,105
l
a
t
o
T
l
e
b
a
t
u
b
i
r
t
t
A
i
d
e
n
a
t
e
R
l
a
t
i
p
a
C
n
o
i
t
a
u
a
v
e
R
l
i
n
g
e
r
o
F
l
’
s
r
e
d
o
h
e
r
a
h
s
-
n
o
n
o
t
i
s
g
n
n
r
a
e
n
o
i
t
p
m
e
d
e
r
e
v
r
e
s
e
r
y
c
n
e
r
r
u
c
e
r
a
h
S
d
e
s
a
b
e
r
a
h
S
i
m
u
m
e
r
p
e
r
a
h
S
l
a
t
i
p
a
c
I
Y
T
U
Q
E
N
I
S
E
G
N
A
H
C
F
O
T
N
E
M
E
T
A
T
S
P
U
O
R
G
2
2
0
2
r
e
b
m
e
c
e
D
1
3
d
e
d
n
E
r
a
e
Y
0
0
0
’
€
s
t
s
e
r
e
t
n
i
g
n
i
l
l
o
r
t
n
o
c
e
v
r
e
s
e
r
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
e
v
r
e
s
e
r
0
0
0
’
€
e
v
r
e
s
e
r
l
n
o
i
t
a
s
n
a
r
t
t
n
e
m
y
a
p
3
8
7
,
9
8
2
9
3
2
6
7
4
,
8
8
0
6
0
0
7
8
4
2
,
1
y
t
i
u
q
e
0
0
0
’
€
2
2
1
,
8
4
5
3
5
,
2
0
2
)
9
(
4
6
4
,
6
3
8
1
)
1
3
7
,
5
(
5
7
5
4
–
–
–
–
4
6
5
,
1
5
2
0
2
1
6
0
7
,
5
4
4
6
5
,
1
5
2
0
2
1
9
1
1
)
6
5
3
,
3
(
5
3
5
)
6
6
6
,
4
(
–
–
–
8
1
2
,
5
7
7
0
,
8
4
–
–
)
9
(
)
1
3
7
,
5
(
5
5
5
,
7
4
5
5
5
,
7
4
7
8
5
,
5
4
–
–
)
6
6
6
,
4
(
0
6
0
0
7
)
0
6
8
,
1
(
–
–
–
–
–
0
6
0
6
–
–
–
–
–
–
–
–
–
0
0
7
0
0
7
–
–
–
–
–
–
4
6
4
,
6
–
–
4
0
6
,
4
–
4
0
6
,
4
–
–
)
6
5
3
,
3
(
–
–
–
–
–
3
8
1
3
8
1
3
8
1
–
–
–
5
3
5
8
1
7
1
0
5
,
6
7
1
1
4
8
,
1
2
0
0
0
’
€
0
0
0
’
€
e
t
o
N
–
–
–
–
–
–
–
–
–
–
0
2
)
x
a
t
f
o
t
e
n
(
i
s
n
o
s
n
e
p
n
o
s
s
o
l
t
n
e
m
e
r
u
s
a
e
m
-
e
R
8
2
e
v
r
e
s
e
r
t
n
e
m
y
a
p
d
e
s
a
b
e
r
a
h
s
n
i
t
n
e
m
e
v
o
M
e
v
r
e
s
e
r
l
n
o
i
t
a
s
n
a
r
t
y
c
n
e
r
r
u
c
i
n
g
e
r
o
f
n
i
t
n
e
m
e
v
o
M
:
y
t
i
u
q
e
n
i
y
l
t
c
e
r
i
d
d
e
s
n
g
o
c
e
r
i
s
n
o
i
t
c
a
s
n
a
r
T
i
d
a
p
s
d
n
e
d
v
D
i
i
:
e
m
o
c
n
i
/
)
e
s
n
e
p
x
e
(
i
e
v
s
n
e
h
e
r
p
m
o
c
r
e
h
t
O
r
a
e
y
l
i
a
c
n
a
n
fi
e
h
t
r
o
f
t
fi
o
r
P
1
2
0
2
y
r
a
u
n
a
J
1
t
A
1
0
5
,
6
7
1
1
4
8
,
1
2
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
–
–
–
–
–
–
–
–
1
0
5
,
6
7
1
1
4
8
,
1
2
8
2
e
v
r
e
s
e
r
t
n
e
m
y
a
p
d
e
s
a
b
e
r
a
h
s
n
i
t
n
e
m
e
v
o
M
e
v
r
e
s
e
r
l
n
o
i
t
a
s
n
a
r
t
y
c
n
e
r
r
u
c
i
n
g
e
r
o
f
n
i
t
n
e
m
e
v
o
M
:
y
t
i
u
q
e
n
i
y
l
t
c
e
r
i
d
d
e
s
n
g
o
c
e
r
i
s
n
o
i
t
c
a
s
n
a
r
T
:
e
s
n
e
p
x
e
i
e
v
s
n
e
h
e
r
p
m
o
c
r
e
h
t
O
r
a
e
y
l
i
a
c
n
a
n
fi
e
h
t
r
o
f
t
fi
o
r
P
2
2
0
2
y
r
a
u
n
a
J
1
t
A
i
d
a
p
s
d
n
e
d
v
D
i
i
1
0
5
,
6
7
1
1
4
8
,
1
2
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
127
128
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
y
t
i
u
q
e
0
0
0
’
€
2
3
3
,
1
2
8
6
1
,
9
5
2
3
8
1
)
1
3
7
,
5
(
6
6
7
,
0
6
2
3
3
,
1
2
–
)
1
3
7
,
5
(
l
a
t
o
T
i
d
e
n
a
t
e
R
l
a
t
i
p
a
C
l
’
s
r
e
d
o
h
e
r
a
h
s
i
s
g
n
n
r
a
e
n
o
i
t
p
m
e
d
e
r
0
0
0
’
€
0
0
0
’
€
e
v
r
e
s
e
r
2
5
9
,
4
7
2
7
6
3
,
6
7
)
3
3
2
,
5
(
2
5
9
,
4
7
2
5
3
5
)
6
6
6
,
4
(
7
6
3
,
6
7
)
3
3
2
,
5
(
–
)
6
6
6
,
4
(
8
8
5
,
5
6
2
8
6
4
,
6
6
0
6
–
–
–
0
6
0
6
0
6
–
–
–
e
r
a
h
S
d
e
s
a
b
0
0
0
’
€
e
v
r
e
s
e
r
t
n
e
m
y
a
p
e
r
a
h
S
i
m
u
m
e
r
p
e
r
a
h
S
l
a
t
i
p
a
c
0
0
0
’
€
0
0
0
’
€
–
–
–
3
8
1
3
8
1
–
3
8
1
–
5
3
5
8
1
7
–
–
–
–
–
–
1
0
5
,
6
7
1
1
4
8
,
1
2
–
–
–
–
–
–
1
0
5
,
6
7
1
1
4
8
,
1
2
1
0
5
,
6
7
1
1
4
8
,
1
2
1
0
5
,
6
7
1
1
4
8
,
1
2
e
v
r
e
s
e
r
t
n
e
m
y
a
p
d
e
s
a
b
e
r
a
h
s
n
i
t
n
e
m
e
v
o
M
:
y
t
i
u
q
e
n
i
y
l
t
c
e
r
i
d
d
e
s
n
g
o
c
e
r
i
s
n
o
i
t
c
a
s
n
a
r
T
r
a
e
y
l
i
a
c
n
a
n
fi
e
h
t
r
o
f
t
fi
o
r
P
1
2
0
2
y
r
a
u
n
a
J
1
t
A
i
d
a
p
s
d
n
e
d
v
D
i
i
e
v
r
e
s
e
r
t
n
e
m
y
a
p
d
e
s
a
b
e
r
a
h
s
n
i
t
n
e
m
e
v
o
M
:
y
t
i
u
q
e
n
i
y
l
t
c
e
r
i
d
d
e
s
n
g
o
c
e
r
i
s
n
o
i
t
c
a
s
n
a
r
T
r
a
e
y
l
i
a
c
n
a
n
fi
e
h
t
r
o
f
s
s
o
L
2
2
0
2
y
r
a
u
n
a
J
1
t
A
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
i
d
a
p
s
d
n
e
d
v
D
i
i
I
Y
T
U
Q
E
N
I
S
E
G
N
A
H
C
F
O
T
N
E
M
E
T
A
T
S
Y
N
A
P
M
O
C
2
2
0
2
r
e
b
m
e
c
e
D
1
3
d
e
d
n
E
r
a
e
Y
129
ACCOUNTING POLICIES
Basis of preparation
In accordance with the AIM and Euronext Growth Rules, the consolidated financial statements of Uniphar plc and its
subsidiaries (the ‘Group’) have been prepared in accordance with International Financial Reporting Standards (IFRS)
and interpretations issued by the IFRS Interpretations Committee (IFRS IC) applicable to companies reporting under
IFRS, as adopted by the EU. The financial statements comply with IFRS as issued by the International Accounting
Standards Board (IASB), as adopted by the EU and as applied in accordance with the Companies Acts 2014.
Uniphar plc is incorporated in the Republic of Ireland under registration number 224324 with a registered office at
4045 Kingswood Road, Citywest Business Park, Co. Dublin, D24 V06K.
The parent company’s financial statements are prepared using accounting policies which are consistent with the
accounting policies applied to the consolidated financial statements by the Group. The accounting policies are set out
below and they have also been applied consistently by all of the Group’s subsidiaries and joint ventures to all years
presented in these financial statements.
The financial statements include the information that is described as being an integral part of the audited financial
statements contained in the Remuneration Committee Report.
Going concern
The Directors have made appropriate enquiries and carried out a thorough review of the Group’s forecasts, projections,
and available banking facilities, taking account of possible changes in trading performance and considering
business risk.
The Group has a robust capital structure with strong liquidity, supported into the future by the banking facility with
a remaining term extending to August 2027 (with two options to extend by a further one year). The Group renewed and
expanded its banking facility during 2022, to provide it with the platform to fund continued growth.
Having regard to the factors outlined above and noting the financial impact of the recently announced acquisitions,
the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence
for the foreseeable future, being a period of 12 months from the date of approval of these financial statements. As a
result, the Directors consider that it is appropriate to continue to adopt the going concern basis, in preparing the
financial statements.
Basis of consolidation
The Group’s financial statements are prepared for the year ended 31 December 2022. The annual financial statements
incorporate the Company and all of its subsidiary undertakings. A subsidiary undertaking is consolidated by reference
to whether the Group has control over the subsidiary undertaking. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power to direct the activities of the entity.
The results of all Group undertakings are prepared to the Group’s financial year end. The principal subsidiaries of
the Group are listed in Note 37. The attributable results of acquisitions are included in the financial statements from
the date of acquisition. The results of the subsidiary undertakings disposed of are included in the consolidated
Income Statement and Cash Flow Statement up to the date control ceases. Intergroup transactions are eliminated
on consolidation in the preparation of the Group’s financial statements.
New standards, amendments and interpretations
The Group has applied the following standards and amendments for the first time for their annual reporting period
commencing 1 January 2022:
» Amendments to IFRS 3, ‘Business combinations’ reference to the conceptual framework
» Amendments to IAS 16, ‘Property, plant and equipment’ proceeds before intended use
» Amendments to IAS 37, ‘Provisions, contingent liabilities and contingent assets’ cost of fulfilling a contract
» Annual improvements to IFRS standards 2018-2020
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not
expected to significantly affect the current or future periods.
130
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
ACCOUNTING POLICIES continued
ACCOUNTING POLICIES continued
New standards and interpretations not yet adopted
The following accounting standards and interpretations have been published that are not mandatory for 31 December 2022
reporting periods and have not been early adopted by the Group:
Foreign currency translation continued
(iv) Net investment hedge
» Amendments to IAS 1, ‘Presentation of financial statements’, on classification of liabilities
» Amendments to IAS 1 and IFRS Practice Statement 2, Disclosure of Accounting Policies
» Amendments to IAS 8, Definition of Accounting Estimate
» Amendment to IAS 12, Deferred tax related to assets and liabilities arising from a single transaction
» IFRS 17 Insurance Contracts
» Amendments to IFRS 16, Lease Liability in a Sale and Leaseback
» Amendments to IAS 1, Non-current Liabilities with Covenants
These standards are not expected to have a material impact in the current or future reporting periods or on foreseeable
future transactions.
Historical cost convention
The financial statements have been prepared on a historical cost basis, except for the following:
» Investments in equity, financial assets and liabilities, certain classes of property, plant and equipment –
measured at fair value
» Defined benefit pension plans – plan assets measured at fair value
The preparation of financial statements in conformity with IFRS requires management to make estimates and
assumptions, that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenue and expenses, during the reporting
period. Actual results could differ from those estimates. The areas involving a high degree of judgement or complexity,
or areas where assumptions and estimates are significant in relation to the consolidated financial statements are
set out in Note 1.
Foreign currency translation
(i)
(ii)
Functional currency and presentational currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (the functional currency). The functional currency of
the parent company is Euro. The consolidated financial statements and parent company financial statements are
presented in Euro.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of
the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from
the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates
are generally recognised in the Income Statement.
Foreign exchange gains and losses are presented in the Income Statement on a net basis within administrative
expenses.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates
at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value
are reported as part of the fair value gain or loss. For example, translation differences on non-monetary assets and
liabilities such as equities held at fair value through the Income Statement are recognised in the Income Statement
as part of the fair value gain or loss and translation differences on non-monetary assets such as equities classified
as investments in equity instruments are recognised in Other Comprehensive Income (OCI).
(iii) Foreign currency translation
The results of each of the Group’s entities with non-Euro functional currencies are translated into Euro at average
exchange rates for the year when they are a reasonable approximation of the cumulative effect of the rates on
transaction dates and the related Balance Sheets have been translated at the closing rate. Goodwill and fair value
adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign
operation and translated at the closing rate. All resulting exchange differences are recognised in other comprehensive
income and taken to a separate reserve within equity. When a foreign entity is disposed of outside the Group, such
exchange differences are recognised in the Income Statement as part of the gain or loss on disposal.
Net investment hedges are foreign currency borrowings used to finance or provide a hedge against Group equity
investments in non-Euro denominated operations to the extent that they are neither planned nor expected to be
repaid in the foreseeable future or are expected to provide an effective hedge of the net investment. When the
hedge is deemed to be effective, foreign exchange differences are taken directly to the foreign currency translation
reserve. The ineffective portion of any gain or loss on the hedging instrument is recognised immediately in the
Income Statement. Cumulative gains and losses remain in equity until disposal of the net investment in the foreign
operation at which point the related differences are transferred to the Income Statement as part of the overall gain
or loss on sale.
Intangible assets
(i) Goodwill
Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is not amortised, but it is tested
for impairment annually, or more frequently if events or changes in circumstances indicate that it might be
impaired and is carried at cost less accumulated impairment losses. Goodwill is allocated to cash-generating
units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups
of cash-generating units that are expected to benefit from the business combination in which the goodwill
arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal
management purposes.
(ii) Computer software
Computer software, including computer software which is not an integrated part of an item of computer hardware
and cloud computing arrangements, is stated at cost less any accumulated amortisation and any accumulated
impairment losses. Cost comprises purchase price and any other directly attributable costs.
Computer software is recognised if it meets the following criteria:
» An asset can be separately identified
» It is probable that the asset created will generate future economic benefits
» The development cost of the asset can be measured reliably
» It is probable that the expected future economic benefits that are attributable to the asset will flow to the entity
» The cost of the asset can be measured reliably
Costs relating to the development of computer software for internal use are capitalised once the recognition
criteria outlined above are met. Computer software is amortised over its expected useful lives of between three
and ten years, by charging equal instalments to the Income Statement from the date the assets are ready for use.
(iii) Trademarks and licenses
Trademarks and licenses are shown at historical cost. Trademarks and licenses have a finite useful life and are
carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate
the cost of trademarks and licenses over their estimated useful lives of five years.
(iv)
Intangible assets – acquired
Intangible assets that are acquired by the Group in a business combination are stated at cost less accumulated
amortisation and impairment losses, when separable or arising from contractual or other legal rights and when
they can be measured reliably.
Intangible assets are amortised on a straight-line basis. The Brand Name is amortised over its expected useful
life of ten years, the Technology asset is amortised over its expected useful life of three years and the Customer
Relationships are amortised over five years.
Amortisation periods, useful lives, expected patterns of consumption and residual values are reviewed at each
financial year end. Changes in the expected useful life or the expected pattern of consumption of future economic
benefits are embodied in the asset and are accounted for by changing the amortisation period or method
as appropriate on a prospective basis.
131
132
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS ACCOUNTING POLICIES continued
ACCOUNTING POLICIES continued
Impairment of assets
Goodwill has an indefinite useful life, is not subject to amortisation and is tested annually for impairment, or more
frequently if events or changes in circumstances indicate that it might be impaired. Other assets are tested for
impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units).
Goodwill impairment testing is performed for groups of cash generating units that are expected to benefit from the
synergies of a business combination. Non-financial assets other than goodwill that suffered an impairment are reviewed
for possible reversal of the impairment at the end of each reporting period.
Property, plant and equipment
Property, plant and equipment are stated at cost or deemed cost, as appropriate, less accumulated depreciation.
Freehold property in Ireland is revalued to fair value and is measured on the basis of deemed cost being the revalued
amount at the date of that revaluation less accumulated depreciation.
Depreciation is calculated, in order to write off the cost of property, plant and equipment, other than land and assets
under construction, over their estimated useful lives by equal annual instalments.
The estimated useful lives of property, plant and equipment by reference to which depreciation has been calculated
are as follows:
Freehold buildings
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computer equipment
Motor vehicles
Instruments
Land is not being depreciated.
50 years
10 years
3 – 10 years
10 years
3 – 5 years
5 years
3 years
Property, plant and equipment and intangible assets recognised as a right-of-use asset in accordance with IFRS 16,
are depreciated over the right-of-use asset’s useful life on a straight-line basis. The average useful life of each of the
right-of-use asset classes are as follows:
Leasehold buildings
Plant and equipment
Motor vehicles
Computer software
12 years
4 years
3 years
5 years
Assets held for sale
Non-current assets that are expected to be recovered principally through sale, rather than continuing use and meet the
IFRS 5 criteria are classified as held for sale. These assets are shown in the Balance Sheet at the lower of their carrying
amount and fair value less any costs to sell. Impairment losses on initial classification as non-current assets held for
sale and subsequent gains or losses on re-measurement are recognised in the Income Statement.
Borrowing costs
Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalised as
part of the cost of that asset for the period of time that is necessary to complete and prepare the asset for its intended
use. All other borrowing costs are recognised as an expense in the Income Statement in the period in which they are
incurred.
Financial assets – investments in subsidiaries
Investments in subsidiaries are stated at cost less any accumulated impairment and are reviewed for impairment if there
are indications that the carrying amount may not be recoverable. They are assessed for impairment annually, as part of
the Group’s overall impairment assessment.
Investments and other financial assets and liabilities
(i) Classification
The Group classifies its financial assets in the following measurement categories:
» Those to be measured subsequently at fair value (either through OCI or through profit or loss)
» Those to be measured at amortised cost
The classification depends on the entity’s business model for managing the financial assets and the contractual
terms of the cash flows.
(ii) Recognition and derecognition
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired
or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.
(iii) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset
not at fair value through the profit or loss, transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets carried at fair value through the profit or loss are expensed
in the Income Statement.
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group
classifies its debt instruments:
» Amortised cost: assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. Interest income from these financial
assets is included in finance income using the effective interest rate method. Any gain or loss arising on
derecognition is recognised directly in the Income Statement and presented in other gains/(losses) together
with foreign exchange gains and losses. Impairment losses are presented as a separate line item in the
Income Statement;
» Fair value through Other Comprehensive Income (FVOCI): assets that are held for collection of contractual
cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of
principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI,
except for the recognition of impairment gains or losses, interest income and foreign exchange gains and
losses which are recognised in the Group Income Statement. When the financial asset is derecognised, the
cumulative gain or loss previously recognised in OCI is reclassified from equity to the Group Income Statement;
and
» Fair value through profit or loss (FVPL): assets that do not meet the criteria for amortised cost or FVOCI are
measured at FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised
in the Group Income Statement in the period in which it arises.
Loans and receivables
Loans and receivables are subsequently carried at amortised cost using the effective interest method.
Financial guarantee contracts
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability
is initially measured at fair value and subsequently at the higher of:
» the amount determined in accordance with the expected credit loss model under IFRS 9 Financial Instruments;
and
» the amount initially recognised less, where appropriate, the cumulative amount of income recognised in
accordance with the principles of IFRS 15 Revenue from Contracts with Customers.
The fair value of financial guarantees is determined based on the present value of the difference in cash
flows between the contractual payments required under the debt instrument and the payments that would
be required without the guarantee, or the estimated amount that would be payable to a third party for
assuming the obligations. Where guarantees in relation to loans or other payables of associates are provided
for no compensation, the fair values are accounted for as contributions and recognised as part of the cost
of the investment.
133
134
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
ACCOUNTING POLICIES continued
ACCOUNTING POLICIES continued
Investments and other financial assets continued
(iii) Measurement – continued
Equity instruments
Investments in equity instruments are subsequently carried at fair value through OCI. Gains or losses arising from
changes, due to both translation differences and other changes, in the fair value are recognised in OCI.
Details on how the fair value of financial instruments is determined are disclosed in Note 32.
(iv)
Impairment
The Group assesses, on a forward-looking basis, the expected credit losses associated with its debt instruments
carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been
a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by IFRS 9, which requires expected
lifetime losses to be recognised from initial recognition of the receivables.
(v)
Income recognition
Interest income
Interest income is recognised in the Income Statement, as it accrues, using the effective interest method.
Dividends
Dividends are recognised as revenue when the right to receive payment is established. This applies even if they are
paid out of pre-acquisition profits. However, the investment may need to be tested for impairment, as a consequence.
Business combinations
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date
on which control is transferred to the Group. Under the acquisition method, the assets, liabilities and contingent
liabilities of an acquired business are initially recognised at their fair value at the date of acquisition.
The Group measures goodwill at the acquisition date as:
» the fair value of the consideration transferred; plus
» the recognised amount of any non-controlling interests in the acquiree; plus
» if the business combination is achieved in stages, the fair value of the pre-existing equity interest in the acquiree;
less the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately in the Income Statement.
The cost of a business combination is measured as the aggregate of the fair values of any assets transferred, liabilities
incurred or assumed, and equity instruments issued in exchange for control. The consideration transferred does not
include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in the
Income Statement.
The fair value attributable to any non-controlling interest arising on an acquisition is calculated based on the
non-controlling interest share of the identifiable net assets at the date of acquisition. When less than 100% of the
issued share capital of a subsidiary is acquired and the acquisition includes an option to purchase the remaining
share capital of the subsidiary, the terms of the option contract are analysed to assess whether they provide the
Group or the non-controlling interest with access to the risks and rewards associated with the actual ownership of the
shares. The non-controlling interest is recognised if risks and rewards associated with ownership have been retained
by the non-controlling interest. The non-controlling interest is not recognised if the risks and rewards associated
with ownership have transferred to the Group, the transaction is accounted for as if the Group had acquired the
non-controlling interests at the date of entering into the option (‘the anticipated acquisition method’). In both scenarios,
a liability is recognised equal to the fair value of the option and this is revised to fair value at each reporting date with
differences being recorded in the Income Statement.
Where a business combination agreement provides for an adjustment to the cost of the combination, which is
contingent on future events, the deferred contingent consideration payable is measured at fair value at the acquisition
date. If the deferred contingent consideration is classified as equity, then it is not remeasured, and settlement is
accounted for within equity. Otherwise, subsequent changes in the fair value of the deferred contingent consideration
are recognised in the Income Statement.
Business combinations continued
When share-based payment awards (replacement awards) are required to be exchanged for awards held by the
acquiree’s employees (acquiree’s awards) and relate to past services, then all or a portion of the amount of the
acquirer’s replacement awards is included in measuring the consideration transferred in the business combination.
This determination is based on the market-based value of the replacement awards compared with the market-based
value of the acquiree’s awards and the extent to which the replacement awards relate to past and/or future service.
When the initial accounting for a business combination is determined provisionally, any adjustments to the provisional
values allocated to the identifiable assets and liabilities are made within twelve months of the acquisition date.
Transaction costs, other than those associated with the issue of debt or equity securities that the Group incurs in
connection with completed business combinations are expensed as incurred.
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption
amount is recognised in the Income Statement over the period of the borrowings using the effective interest method.
Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it
is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down
occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee
is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Borrowings are removed from the Balance Sheet when the obligation specified in the contract is discharged, cancelled,
or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred
to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognised in the Income Statement as other income or finance costs.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting period.
Cash and cash equivalents
For the purpose of presentation in the Cash Flow Statement, cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other short-term highly liquid investments with original maturities of three
months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value, and bank overdrafts.
Share capital
Ordinary shares are classified as equity. Proceeds from the issue of ordinary shares are classified as equity. Incremental
costs directly attributable to the issue of new shares or options are recognised directly in retained earnings within
equity, net of any tax effects.
Leases
The Group leases various properties, plant and equipment, software and motor vehicles. Rental contracts are typically
made for fixed periods of one to thirty years but may have extension options as described below. Lease terms are
negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements
do not impose any covenants, but leased assets may not be used as security for borrowing purposes.
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance
cost is charged to the Income Statement over the lease period to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. The right-of-use asset is depreciated over the right-of-use assets
useful life on a straight-line basis.
135
136
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
ACCOUNTING POLICIES continued
ACCOUNTING POLICIES continued
Leases continued
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net
present value of the following lease payments:
» Fixed payments (including in-substance fixed payments), less any lease incentives receivable
» Variable lease payments that are based on an index or a rate
» Amounts expected to be payable by the lessee under residual value guarantees
» The exercise price of a purchase option if the lessee is reasonably certain to exercise that option
» Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined; or the
Group’s incremental borrowing rate which is calculated using a portfolio approach, based on the nature of the lease.
The discount rate per lease asset class is:
» Buildings – 3%
» Plant and equipment – 4%
» Motor vehicles – 5%
» Computer equipment – 4%
Right-of-use assets are measured at cost comprising the following:
» The amount of the initial measurement of lease liability
» Any lease payments made at or before the commencement date less any lease incentives received
» Any initial direct costs
» Restoration costs
Extension and termination options are included in a number of property and equipment leases across the Group.
These terms are used to maximise operational flexibility in terms of managing contracts. The majority of extension
and termination options held are exercisable only by the Group and not by the respective lessor.
Payments associated with leases of low-value assets are recognised on a straight-line basis as an expense in the
Income Statement.
Low-value assets comprise of computer equipment, small items of office furniture, and in-store equipment in our
retail pharmacies.
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective
interest method, less provision for impairment. Provision is made using the expected credit loss model, which uses
a lifetime expected loss allowance for all trade receivables.
Inventory
Inventories are stated at the lower of cost and net realisable value. Cost is based on the moving average cost method
(and first in first out principle where appropriate). Moving average is a costing method used under a perpetual inventory
system whereby, after each purchase, average unit cost is recomputed by adding the cost of purchased units to
the cost of units in inventory and dividing by the new total number of units. The first in, first out principle includes all
expenditure which has been incurred in the normal course of business in bringing the products to their present location
and condition. Net realisable value comprises selling price net of trade but before settlement discounts, less all costs
to be incurred in marketing, selling and distribution.
Trade and other payables
Trade and other payables are initially recorded at fair value, which is usually the original invoiced amount,
and subsequently carried at amortised cost using the effective interest rate method. Liabilities are derecognised
when the obligation under the liability is discharged, cancelled or expires.
Earnings per share
Basic earnings per share are calculated based on the profit/loss for the year attributable to owners of the Company
and the basic weighted average number of shares outstanding. Diluted earnings per share are calculated based on the
profit/loss for the year attributable to owners of the Company and the diluted weighted average number of shares and
potential shares outstanding. Shares are only treated as dilutive if their dilution results in a decreased earnings per share
or increased loss per share. Dilutive effects arise from share-based payments that are settled in shares. Conditional
share awards to employees have a dilutive effect when the average share price during the period exceeds the exercise
price of the awards and the market or non-market conditions of the awards are met, as if the current period end were
the end of the vesting period. When calculating the dilutive effect, the exercise price is adjusted by the value of future
services that have yet to be received related to the awards.
Dividends
Dividends on ordinary shares are recognised as a liability in the financial statements only after they have been approved
at the Annual General Meeting of the Company.
Employee benefits
Share-based payments
The grant-date fair value of equity-settled share-based payment arrangements granted to employees is recognised
as an expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognised
as an expense is adjusted to reflect the number of awards for which the related service and non-market performance
conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards that
meet the related service and non-market performance conditions at the vesting date.
The fair value of the amount payable to employees in respect of cash LTIP awards, which are settled in cash,
is recognised as an expense with a corresponding increase in liabilities, over the period during which the employees
become unconditionally entitled to payment. The liability is remeasured at each reporting date and at settlement date
based on the fair value of the cash LTIP awards. Any changes in the liability are recognised in the Income Statement.
Certain Directors and employees may acquire shares in the Company under long-term incentive plans. The Company
accounts for the proceeds of these share issues as and when payment of the nominal value of the share is called.
Post-employment obligations
The liability or asset recognised in the Balance Sheet in respect of defined benefit pension plans is the present value
of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit
obligation is calculated annually by independent actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows,
using market yields of high-quality corporate bonds that are denominated in the currency in which the benefits will be
paid, and that have terms approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and
the fair value of plan assets. This cost is included in finance costs in the Income Statement.
Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in OCI. They are included in retained earnings in the Statement
of Changes in Equity and in the Balance Sheet. Changes in the present value of the defined benefit obligation resulting
from plan amendments or curtailments are recognised immediately in the Income Statement as past service costs.
The defined contribution pension charge to operating profit comprises the contribution payable to the scheme
for the year.
137
138
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS ACCOUNTING POLICIES continued
ACCOUNTING POLICIES continued
Revenue
Revenue is measured at the fair value of the consideration received or receivable and represents the amount
receivable for goods supplied or services rendered, net of returns, discounts and rebates allowed by the Group and
value-added tax.
The Group bases its estimate of returns, discounts, and rebates on historical results, taking into consideration the type
of customer, the type of transaction and the specifics of each arrangement.
Where the consideration receivable in cash or cash equivalents is deferred, and the arrangement constitutes a financing
transaction, the fair value of the consideration is measured as the present value of all future receipts using the imputed
rate of interest.
The Group recognises revenue in the amount of the price expected to be received for goods and services supplied at a
point in time or over time, as contractual performance obligations are fulfilled, and control of goods and services passes
to the customer.
In certain of the Group’s contracts where another party is involved in providing goods or services to its customer,
the Group determines whether it is a principal or an agent in these transactions by evaluating the nature of its promise
to the customer. The Group is a principal and records revenue on a gross basis if it controls the promised goods or
services before transferring them to the customer. In circumstances where the Group’s role is only to arrange for
another entity to provide the goods or services, then the Group is an agent and revenue is recognised at the net amount
that it retains for its agency services. The Group has concluded that it is the principal in its revenue arrangements,
except for certain agreements in Product Access where the Group’s role is only to arrange for another entity to provide
the goods or services.
An analysis of the revenue recognition principles applied in each of the Group’s operating segments is provided below:
Commercial & Clinical
Revenue is derived from the provision of goods and services falling within the Group’s ordinary activities after deduction
of trade discounts and value-added tax.
Sales of goods are recognised on despatch to the customer, and there is no unfulfilled performance obligation that
could affect the customer’s acceptance of the product. Despatch occurs when the goods have been shipped to
the location specified by the customer, the risks of obsolescence or loss have been transferred to the customer,
the customer has accepted the products in accordance with the sales contract, the acceptance provisions have
lapsed, or the Company has objective evidence that all criteria for acceptance have been satisfied. Where sales are
on a consignment basis, revenue is not recognised until a sale has been made to a third party. In some circumstances,
goods are sold with volume rebates. Sales are measured at the prices specified in the sale contract, net of estimated
volume rebates. Volume rebates are assessed based on anticipated annual purchases and historical experience.
Revenue arises from the provision of resourcing, outsourcing and consultancy services and the provision of patient
solution services. Revenue from service contracts is recognised in the financial year in which the services are rendered
and when the outcome of the contract can be estimated reliably.
Product Access
Revenue is measured at the fair value of the consideration received or receivable and represents the amount receivable
for goods supplied or services rendered, net of value-added tax and trade discounts. Revenue arises from the sale of
goods to wholesalers, retailers and hospitals.
The Group bases its estimate of returns, discounts, and rebates on historical results, taking into consideration the
type of customer, the type of transaction and the specifics of each arrangement. The Group recognises revenue in
the amount of the price expected to be received for goods supplied at a point in time as contractual performance
obligations are fulfilled, and control of goods passes to the customer.
Service revenue arises on the provision of product development solutions and the delivery of Expanded Access
Programs. Revenue from service contracts is recognised in the financial year in which the services are rendered and
when the outcome of the contract can be estimated reliably.
Revenue continued
Supply Chain & Retail – pre-wholesale and wholesale
Revenue is derived from the provision of goods and services falling within the Group’s ordinary activities after deduction
of trade discounts and value-added tax. Revenue arises from the sale of goods to wholesalers, retailers, hospitals,
the operation of retail pharmacies, and the provision of services to retail pharmacies.
Sales of pharmaceutical and healthcare related products are recognised on delivery to the purchaser, hospital or
retail pharmacy, when the purchaser has full discretion over the channel and price to sell the product and there is no
unfulfilled obligation that could affect the purchaser’s acceptance of the product. Delivery occurs when the products
have been shipped to the location specified by the purchaser, the risks of obsolescence or loss have been transferred
to the purchaser, the purchaser has accepted the products in accordance with the sales contract, the acceptance
provisions have lapsed, or the Group has objective evidence that all criteria for acceptance have been satisfied.
Products sold to customers are often sold with volume rebates and also with the provision for the customer to return
faulty goods. Sales are measured at the prices specified in the sale contract, net of estimated volume rebates and
returns. Volume rebates are assessed based on anticipated annual purchases and historical experience.
Sales are normally made with credit terms of between 30-90 days. This element of financing is deemed immaterial and
is disregarded in the measurement of revenue.
Supply Chain & Retail – retail pharmacies
The Group operates retail shops for the sale of pharmacy and certain related products. Sales of products are
recognised on sale to the customer, which is considered the point of delivery. Retail sales are usually by cash, credit or
debit card and government reimbursement.
Cost of sales
Commercial & Clinical
The cost of sales attributable to the supply of goods includes all costs of purchase of inventory and other costs incurred
net of value-added tax in bringing inventories for resale to their present location and condition. When inventories are
sold, the carrying amount of those inventories is recognised as an expense in the period in which the related revenue
is recognised.
The cost of sales attributable to the supply of services includes all direct costs attributable to the provision of
resourcing, outsourcing and consultancy services net of value-added tax. The cost of service is recognised as an
expense in the period in which the related revenue is recognised.
Product Access
The cost of sales includes all direct costs attributable to the provision of services and cost of purchase of inventory for
resale net of value-added tax. When a service is provided or inventory is sold, the cost of service or carrying amount of
inventory is recognised as an expense in the period in which the related revenue is recognised.
The cost of sales attributable to the supply of services includes all direct costs attributable to the provision of resourcing
and outsourcing services net of value-added tax. The cost of service is recognised as an expense in the period in which
the related revenue is recognised.
Supply Chain & Retail
The cost of sales includes all costs of purchase of inventory and other costs incurred net of value-added tax in bringing
inventories for resale to their present location and condition. When inventories are sold, the carrying amount of those
inventories is recognised as an expense in the period in which the related revenue is recognised. In addition to all direct
costs attributable to the provision of services, the cost of service is recognised as an expense in the period in which the
related revenue is recognised.
139
140
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS ACCOUNTING POLICIES continued
NOTES TO THE FINANCIAL STATEMENTS
Income tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Company, and the Company’s subsidiaries and associates operate and
generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in
which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of
amounts expected to be paid to the tax authorities.
Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not
recognised if they arise from the initial recognition of goodwill. Deferred tax is also not accounted for if it arises from
initial recognition of an asset or liability in a transaction other than a business combination that at the time of the
transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates (and laws)
that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when
the related deferred tax asset is realised or the deferred tax liability is settled. Deferred tax assets and liabilities are not
recognised for temporary differences between the carrying amount and tax bases of investments in foreign operations
where the Company and its subsidiaries are able to control the timing of the reversal of the temporary differences and
it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities
are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise
the asset and settle the liability simultaneously.
Current and deferred tax is recognised in the Income Statement, except to the extent that it relates to items recognised
in OCI or directly in equity. In this case, the tax is also recognised in OCI or directly in equity, respectively.
Exceptional items
With respect to exceptional items, the Group has applied an Income Statement format which seeks to highlight
significant items within Group results for the year. Such items may include restructuring costs, professional fees
including directly attributable acquisition costs, cessation of supplier contracts, acquisition integration costs,
impairment of non-current assets, profit and loss on disposal of tangible assets and investments, and movements in
deferred contingent consideration. The Group exercises judgement in assessing the particular items which, by virtue
of their scale and nature, should be disclosed in the Income Statement and related notes as exceptional items.
1
Significant estimates and judgements
The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal
the actual results. Management also needs to exercise judgement in applying the Group’s accounting policies.
Management estimates and judgements
Information about critical estimates and judgements in applying accounting policies that have the most significant effect
on the amounts recognised in the financial statements are included in the following notes:
Impairment assessment of goodwill and other non-current assets
The Group tests annually whether goodwill has suffered any impairment. Determining whether goodwill is impaired
requires comparison of the value in use for the relevant CGUs to the net assets attributable to these CGUs. The value
in use calculation is based on an estimate of future cash flows expected to arise from the CGUs and these are
discounted to net present value using an appropriate discount rate. In calculating value in use, management judgement
is required in forecasting cash flows of CGUs, in determining terminal growth values and in calculating an appropriate
discount rate. The goodwill impairment test is sensitive to these estimates. The Group has performed sensitivity
analysis over the value in use calculation with respect to the key estimates. Management have performed detailed
sensitivity analysis on each of the CGUs by applying sensitivities to each of the key assumptions. This analysis
resulted in an excess in the recoverable amount over their carrying amount for all CGUs. Management believe that
any reasonable change in any of the key assumptions would not cause the carrying value of goodwill to exceed the
recoverable amount. Further information is detailed in the intangible assets Note 10.
Business combinations
In accounting for business combinations, the identifiable assets, liabilities, and contingent liabilities acquired have
to be measured at their fair values. Judgement is required in; estimating the fair value of inventory with reference
to current selling prices and an assessment of obsolescence and demand for inventory; the fair value of trade
debtors with reference to the ageing and recoverability of these, onerous contracts, the fair value of leased assets
and estimating, if applicable, the deferred contingent consideration. Management judgement is also required in the
identification and valuation of any potential intangible assets arising on acquisitions. Additionally, judgement is required
in assessing the risks and rewards of ownership associated with any non-controlling interest in a business combination.
Details concerning acquisitions and business combinations are outlined in Note 35 and provisions relating to deferred
contingent consideration are included in Note 19.
IFRS 16 ‘Leases’
IFRS 16 ‘Leases’ required management judgement in the selection of the appropriate discount rates to be used in the
discounting of the expected future payments to present value. The discount rate applied is the interest rate implicit in
the lease, if that rate can be determined, or by using the Group’s incremental borrowing rate which is calculated using
a portfolio approach, based on the nature of the lease. The discount rate per lease asset class is:
Buildings – 3%
Plant and equipment – 4%
Motor vehicles – 5%
Computer Software – 4%
Impairment of inventory
The Group sells pharmaceutical, health and beauty products and medical devices. Pharmaceutical includes ethical
medicines, OTC, hospital, and veterinary products. As a result, it is necessary to consider the recoverability of the
carrying amount of inventory at the end of each financial year. When calculating any inventory impairment, management
applies judgement in considering the nature and condition of the inventories, current estimated selling prices, as well
as applying assumptions around anticipated saleability of goods held for resale. See Note 15 for the carrying amount of
the inventories and the provision recognised.
Revenue recognition
Management judgement is required in the assessment of whether the Group acts as an agent or a principal in
transactions and accordingly whether revenue should be recorded on a gross or net basis. As part of this assessment,
the Group has considered its responsibilities for fulfilling contracts, inventory risk, and establishing selling prices.
141
142
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS 1
Significant estimates and judgements continued
Income taxes
The Group is subject to income taxes in numerous jurisdictions and judgement is therefore required in determining
the provision for income taxes. Provisions for taxes require judgement and estimation in interpreting tax legislation,
current case law and the uncertain outcomes of tax audits and appeals. Where the final outcome of these matters
differs from the amounts recognised, differences will impact the tax provisions once the outcome is known. In addition,
the Group recognised deferred tax assets, mainly relating to unused tax losses, when it is probable that the assets
will be recovered through future profitability and tax planning. The assessment of recoverability involves judgement.
Further information is contained in Note 7, income tax expense.
Provisions
The amount recognised for a provision is management’s best estimate of the expenditure to be incurred. Provisions are
measured at each Balance Sheet date based on the best estimate of the expected settlement amount. Changes to the
best estimate of the settlement amount may result from changes in the amount of timing of the outflows or changes
in discount rates.
Deferred contingent consideration is recognised in the Group Balance Sheet as provisions. The expected payment
is determined in respect of each individual agreement taking into account the expected level of profitability of each
acquisition. Deferred contingent consideration is recognised at fair value at the acquisition date and included in the
cost of the business combination. Deferred contingent consideration arrangements are based on earn-out agreements
providing for future payment if certain pre-defined profit targets are achieved. The fair value of deferred contingent
consideration is estimated using an income-based approach, by estimating the expected payment based on the
forecasted performance of the acquired business and discounting the expected future payment to present value using
an appropriate discount rate. The movement in deferred contingent consideration in the period is outlined in Note 19.
Further details on measurement, sensitivities applied, and maturity profile are outlined in Note 32.
Useful economic lives of property, plant and equipment (including lease assets) and intangible assets
Determining the useful life of property, plant and equipment and intangible assets require judgement. Management
regularly reviews the useful economic lives and residual values. They are amended when necessary to reflect current
estimates, based on technological advancement, economic utilisation and the physical condition of the assets.
See Note 10 and 11 for the carrying amount of the intangible assets and property, plant and equipment, and the
amortisation and depreciation charge for each class of asset, and the accounting policies for the useful economic
lives for each class of asset.
Exceptional items
The Group Income Statement separately identifies results before exceptional items. Exceptional items are those
that in our judgement need to be disclosed by virtue of their size, nature or incidence. The Group believes that this
presentation provides additional analysis as it highlights one-off items and non-trading items. The determination of
‘significant’ as included in our definition uses qualitative and quantitative factors which remain consistent from period
to period. Management uses judgement in assessing the particular items, which by virtue of their scale and nature,
are disclosed in the Group Income Statement and related notes as exceptional items. Management considers the
Group Income Statement presentation of exceptional items to be appropriate as it provides useful additional information
and is consistent with the way that financial information is measured by management and presented to the Board. In
that regard, management believes it to be consistent with paragraph 85 of IAS 1 ‘Presentation of financial statements’
(IAS 1), which permits the inclusion of line items and subtotals that improve the understanding of performance.
2
Revenue
Revenue
Commercial & Clinical
Product Access
Supply Chain & Retail
Total Revenue
2022
€’000
2021
€’000
2,070,669
1,943,149
2022
€’000
2021
€’000
306,766
206,868
299,908
157,152
1,557,035
1,486,089
2,070,669
1,943,149
The Commercial & Clinical revenue of €306,766,000 (2021: €299,908,000) consists of revenue derived from MedTech
of €233,203,000 (2021: €208,137,000) and Pharma of €73,563,000 (2021: €91,771,000).
Segmental information
Segmental information is presented in respect of the Group’s geographical regions and operating segments.
The operating segments are based on the Group’s management and internal reporting structures.
Geographical analysis
The Group operates in two principal geographical regions being the Republic of Ireland and the UK. The Group
also operates in several European countries, the US and the Asia Pacific region which are not material for
separate identification.
The following is a geographical analysis presented in accordance with IFRS 8 ‘Operating Segments’ which requires
disclosure of information about the country of domicile (Ireland) and countries with material revenue.
Ireland
UK
Rest of the World (ROW)
2022
€’000
2021
€’000
1,765,064
1,672,158
142,157
163,448
161,714
109,277
2,070,669
1,943,149
143
144
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
2
Revenue continued
2
Revenue continued
At 31 December 2022
Intangible assets (excluding goodwill)
Property, plant and equipment
Deferred tax asset
Other receivables
Financial assets – Investment in equity instruments
Ireland
€’000
20,026
149,006
2,277
494
25
UK
€’000
494
5,483
1,118
–
–
ROW
€’000
Total
€’000
3,939
12,139
5,625
15
–
24,459
166,628
9,020
509
25
Non-current assets (excluding goodwill)
171,828
7,095
21,718
200,641
Goodwill
Non-current assets
At 31 December 2021
Intangible assets (excluding goodwill)
Property, plant and equipment
Deferred tax asset/(liability)
Other receivables
Financial assets – Investment in equity instruments
482,981
683,622
ROW
€’000
Total
€’000
4,588
3,237
(1,481)
75
–
22,968
152,491
1,734
388
25
Ireland
€’000
17,951
141,576
2,227
313
25
UK
€’000
429
7,678
988
–
–
Non-current assets (excluding goodwill)
162,092
9,095
6,419
177,606
Goodwill
Non-current assets
423,643
601,249
Operating segments
IFRS 8 ‘Operating Segments’ requires the reporting information for operating segments to reflect the Group’s
management structure and the way the financial information is regularly reviewed by the Group’s Chief Operating
Decision Maker (CODM), which the Group has defined as the Board of Directors.
The Group operates with three divisions: Commercial & Clinical, Product Access, and Supply Chain & Retail.
These divisions align to the Group’s operational and financial management structures:
» Commercial & Clinical provide outsourced services, specifically sales, marketing and multichannel account
management to pharmaco-medical manufacturers, and distribution and support services to medical device
manufacturers. Uniphar offers a fully integrated digitally enabled customer centric solution that is supported through
market data, insights and digital programmes. We integrate these programmes with our supply chain and distribution
capability to provide a full end-to-end service to manufacturers;
» Product Access consists of two service offerings: On Demand and Exclusive Access. On Demand provides access
to pharmaco-medical products and treatments, by developing valuable relationships and interactions between
manufacturers and other healthcare stakeholders. This business operates in both the retail and hospital markets in
the Irish, UK, European, APAC and MENA markets. Exclusive Access provides bespoke distribution partnerships to
pharmaceutical partners around key brands, with new programmes focused on speciality pharmaceutical products.
It delivers a unique patient support programme that allows healthcare professionals to connect with patients,
on a global basis; and
» Supply Chain & Retail provides both pre-wholesale and wholesale distribution of pharmaceutical, healthcare and
animal health products to pharmacies, hospitals and veterinary surgeons in Ireland. Uniphar operates a network
of pharmacies under the Life, Allcare and Hickey’s brands. Additionally, through the extended Uniphar symbol
group, the business provides services and supports that help independent community pharmacies to compete
more effectively.
Operating segments results
The Group evaluates performance of the operational segments on the basis of gross profit from operations.
Revenue
Gross profit
Revenue
Gross profit
2022
Commercial
& Clinical
€’000
2022
Product
Access
€’000
2022
Supply Chain
& Retail
€’000
2022
Total
€’000
306,766
117,554
206,868
1,557,035
2,070,669
50,178
139,012
306,744
2021
Commercial
& Clinical
€’000
2021
Product
Access
€’000
2021
Supply Chain
& Retail
€’000
2021
Total
€’000
299,908
104,398
157,152
1,486,089
1,943,149
41,318
128,781
274,497
Assets and liabilities are reported to the Board at a Group level and are not reported on a segmental basis.
145
146
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 3
Other operating income
4
Exceptional (charge)/income continued
Other income and commission
(Loss)/profit on disposal of property, plant & equipment
4
Exceptional (charge)/income
Professional fees including acquisition costs
Redundancy and restructuring costs
Acquisition integration costs
Settlement loss on closure of defined benefit pension scheme
Foreign exchange revaluation of deferred contingent consideration
Cessation of supplier contracts – recovery/(inventory write off)
Other exceptional costs
2022
€’000
185
(29)
156
2022
€’000
(6,607)
(6,165)
(3,337)
–
–
115
(421)
2021
€’000
217
20
237
2021
€’000
(3,339)
(4,610)
(2,295)
(211)
(1,373)
(1,754)
(822)
Exceptional charge recognised in operating profit
(16,415)
(14,404)
Decrease in deferred contingent consideration
Decrease in deferred acquisition consideration
Change in discount rates on deferred contingent consideration
Refinancing costs impairment
Exceptional credit recognised in finance cost
Exceptional credit recognised in income tax
Total exceptional (charge)/income
12,030
19,761
109
1,405
(353)
–
–
–
13,191
19,761
1,106
(2,118)
777
6,134
Professional fees including acquisition costs
Professional fees including acquisition costs relate to costs incurred in relation to acquisitions and include third
party fees.
Redundancy and restructuring costs
Redundancy and restructuring costs are primarily redundancy and ex gratia termination costs arising on reorganisations
and recent acquisitions.
Acquisition integration costs
Acquisition integration costs relate to professional fees incurred on the integration of recent acquisitions into the
expanded Group and payments made to staff agreed as part of the RRD International acquisition which are not classified
as consideration.
Cessation of supplier contracts
Cessation of specific MedTech supplier contracts in 2021 relating to the supply of PPE and decontamination
equipment giving rise to inventory write offs. A portion of this write off was recovered in 2022 resulting in a credit to the
Income Statement.
Deferred contingent consideration
Deferred contingent consideration relates to a release of €12,030,000 following a review of expected performance
against earn out contractual targets in relation to Diligent Health Solutions (€6,530,000) and EPS Group (€5,500,000).
In the prior year, deferred contingent consideration relates to a release of €21,739,000 following a review of expected
performance against earn out contractual targets in relation to the Durbin Group, and a release of €2,853,000 due to the
completion of the earnout period and contractual terms in relation to the Sisk Healthcare Group. In addition, a provision
of €4,831,000 has been recognised in respect of increased deferred contingent consideration payable in relation to the
EPS Group.
Deferred acquisition consideration
An amount of €109,000 was released from deferred acquisition consideration for one independent community
pharmacy (2021: €nil).
Change in discount rates on deferred contingent consideration
The deferred contingent consideration liability at 31 December 2022 has been revised using updated discount rates
reflecting an increase in the discount rate applied to compute the present value of the liability resulting in a credit of
€1,405,000 to the Income Statement.
Refinancing costs
The Group entered a new and enlarged borrowing facility in August 2022 ahead of the expiration of the previous facility.
As the previous facility has been superseded, the remaining fees capitalised in respect of it have been charged to the
Income Statement in the year.
147
148
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 5
Operating profit
5
Operating profit continued
Operating profit is stated after charging/(crediting):
Directors’ remuneration:
» Emoluments
» Defined contribution pension*
» Fees
Depreciation (Note 11)
Amortisation (Note 10)
Foreign exchange net loss
(Loss)/profit on disposal of property, plant and equipment
2022
€’000
2021
€’000
2,205
–
601
23,356
5,114
790
(29)
2,980
30
688
22,225
4,705
748
20
Subsidiary company auditors – Non PwC
» Audit of subsidiary accounts
Wages and salaries
Staff costs (including Directors):
»
»
»
Pension costs (Note 20)
Social welfare costs
2022
€’000
2021
€’000
48
–
144,538
147,466
14,936
4,058
14,892
4,313
163,532
166,671
* There were no defined contribution pension costs included in Directors’ remuneration. The 2021 costs which were
charged to the Group Income Statement relate to pension contributions relating to one Director.
Auditors’ remuneration (including expenses) is for the statutory audit of the Group’s financial statements, subsidiary
financial statements and other services carried out for the Group by the Company’s auditors and subsidiary auditors.
Included in fees payable for the audit of the Group accounts are total fees of €84,000 (2021: €80,000) which are due to
the Group’s auditor in respect of the Parent Company. The non-audit services performed by PwC during the year largely
related to due diligence and tax advice on acquisitions completed during the year.
Payroll costs amounting to €1,063,000 (2021: €190,000) were capitalised to property, plant & equipment and software
related projects as these costs are directly related to development and construction work completed in the year to
31 December 2022.
Employees
The average number of persons employed by the Group (including Directors) during the year was as follows:
Company
Group
2022
Number
2021
Number
2022
Number
2021
Number
Group auditors – PwC
Audit of group accounts
Tax compliance services
Tax advisory services – M&A
Tax advisory services – Other
Other non-audit services – M&A
PwC
Ireland
€’000
2022
PwC
Overseas
€’000
1,125
181
536
31
230
2,103
–
81
426
10
–
517
Total
€’000
1,125
262
962
41
230
PwC
Ireland
€’000
2021
PwC
Overseas
€’000
961
110
133
113
274
–
43
283
6
–
332
2,620
1,591
Total
€’000
961
153
416
119
274
1,923
Administration
Selling, distribution and warehouse
6
Finance cost/(income)
107
–
107
96
–
96
Interest on lease obligations (Note 21)
Interest payable on borrowings and non-recourse financing
Fair value adjustment to deferred and deferred contingent consideration
Amortisation of refinancing transaction fees
Interest receivable
Finance cost before exceptional credit
Decrease in fair value of deferred contingent consideration (Note 4)
Release of refinancing transaction fees (Note 4)
Exceptional credit recognised in finance cost
Total finance income
674
2,280
2,954
2022
€’000
3,644
5,646
2,137
339
(96)
11,670
621
2,299
2,920
2021
€’000
3,772
3,154
1,915
303
(37)
9,107
(13,544)
(19,761)
353
–
(13,191)
(19,761)
(1,521)
(10,654)
Finance costs do not include capitalised borrowing costs of €66,000 (2021: €nil) on qualifying assets (Note 10 and 11).
Interest is capitalised at the Group’s weighted average interest rate for the period 2.1% (2021: nil).
149
150
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 7
Income tax expense
7
Income tax expense continued
Recognised in the Income Statement:
Current income tax:
Republic of Ireland
Overseas
Total current income tax expense
Deferred income tax:
Origination and reversal of temporary differences:
Property, plant and equipment
Employee benefits
Tax losses
Other timing differences
Total deferred income tax (credit)/expense
2022
€’000
2021
€’000
5,289
5,836
11,125
220
(917)
(995)
(463)
(2,155)
3,129
4,522
7,651
148
(38)
(47)
(35)
28
Total income tax expense
8,970
7,679
Attributable to:
Continuing operations
Total income tax expense
8,970
8,970
7,679
7,679
Other timing differences relate to the amortisation of the Hickey’s Pharmacy brand name of €70,000 (2021: €70,000),
the amortisation of acquired customer relationships and technology assets of €325,000 (2021: €138,000),
credits associated with finance costs of €68,000 (2021: €nil) offset by the deferral of taxes on Swedish profits of €nil
(2021: €173,000).
Factors affecting the tax expense in future years
In addition to the Republic of Ireland, the Group has operations in the overseas tax jurisdictions of the UK, Germany,
the Netherlands, the Nordics, USA and the Asia Pacific region.
From 2024, Ireland will adopt a global minimum corporation tax rate of 15% under the OECD International Tax
Agreement with regard to applying the Global Anti-Base Erosion rules.
The UK tax authority has announced that its statutory corporate tax rate of 19% will increase to 25% for profits over
£250,000 from 1 April 2023.
There are no expected material corporate income tax changes in the other jurisdictions from current 2022 rates which
range from 20% to 26%, inclusive of Federal and State charges.
Reconciliation of effective tax rate
Profit on ordinary activities before tax
2022
€’000
2021
€’000
54,676
55,801
Profit on ordinary activities multiplied by standard rate of corporation tax in the
Republic of Ireland of 12.5% (2021: 12.5%)
6,835
6,975
Effects of:
Disallowable expenses
Research & Development tax credits
Exceptional gains not taxable
Higher overseas income tax rates
Charge/(credit) on previously recognised/(unrecognised) tax losses
Tax base asset adjustments in respect of prior years
Over provision of corporation tax in prior year
Total income tax expense for the year
8
Earnings per share
Basic and diluted earnings per share have been calculated by reference to the following:
1,833
(152)
(1,693)
2,140
352
317
(662)
8,970
2,582
(68)
(2,470)
1,893
(993)
205
(445)
7,679
2022
2021
Profit for the financial year attributable to owners (€’000)
45,587
48,077
Weighted average number of shares (‘000)
272,557
269,752
Earnings per ordinary share (in cent):
» Basic
» Diluted
16.7
16.7
17.8
17.8
151
152
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 8
Earnings per share continued
10
Intangible assets
2022
€’000
2021
€’000
Computer
software
€’000
Trademarks
& licenses
€’000
Goodwill Technology
asset
€’000
€’000
Brand name
€’000
Customer
relationships
€’000
Total
€’000
Adjusted earnings per share has been calculated by reference to the following:
Profit for the financial year attributable to owners
45,587
48,077
Exceptional charge recognised in operating profit (Note 4)
Exceptional credit recognised in finance costs (Note 4)
Exceptional credit recognised in income tax
Tax credit on acquisition related intangibles
Amortisation of acquisition related intangibles
16,415
(13,191)
(1,106)
(329)
2,708
14,404
(19,761)
(777)
(207)
2,063
Profit after tax excluding exceptional items
50,084
43,799
Weighted average number of shares in issue in the year (000’s)
Adjusted basic and diluted earnings per ordinary share (in cent)
272,557
269,752
18.4
16.2
The weighted average number of ordinary shares includes the effect of 6,543,620 shares (2022: 2,822,264 on a
weighted basis) (2021: 6,218,620 shares (2021: 3,663,023 on a weighted basis)) granted under the LTIP that have
met the share price performance conditions, but will not vest until 31 December 2024. There is no impact on the
weighted average number of ordinary shares granted under new senior management share option schemes in the
year (2021: 16,964 shares).
9
Dividends
The Directors have proposed a final dividend of €3.1m (€0.0113 per ordinary share), subject to approval at the AGM.
This results in a total shareholders dividend of €4.8m (€0.0174 per ordinary share) in respect of the year ended
31 December 2022 as the Board declared and paid a 2022 interim dividend of €1.7m (€0.0061 per ordinary share).
If approved, the proposed dividend will be paid on 16 May 2023 to ordinary shareholders on the Company’s register
on 21 April 2023. This dividend has not been provided for in the Balance Sheet at 31 December 2022, as there was
no present obligation to pay the dividend at year end.
A final dividend of €3.0m (€0.011 per ordinary share) relating to 2021 was paid in May 2022.
Cost
At 1 January 2021
FX movement
Acquisitions (Note 35)
Additions
Disposals/retirements
Reclassifications
30,168
153
379,454
31
25
5,803
(160)
313
–
–
–
–
–
9,039
53,859
–
–
–
723
103
2,088
–
–
–
11,238
–
–
–
–
–
2,996
130
–
–
–
–
424,732
9,303
55,972
5,803
(160)
313
At 31 December 2021
36,180
153
442,352
2,914
11,238
3,126
495,963
At 1 January 2022
FX movement
Acquisitions (Note 35)
Additions
Disposals/retirements
36,180
153
442,352
(36)
328
5,965
(490)
–
36
–
–
(1,509)
60,847
–
–
2,914
133
–
–
–
11,238
–
–
–
–
3,126
196
–
–
–
495,963
(1,216)
61,211
5,965
(490)
At 31 December 2022
41,947
189
501,690
3,047
11,238
3,322
561,433
Amortisation
At 1 January 2021
FX movement
Amortisation
Disposals/retirements
Reclassifications
25,666
122
18,709
4
2,610
(156)
3
–
31
–
–
–
–
–
–
At 31 December 2021
28,127
153
18,709
At 1 January 2022
FX movement
Amortisation
Disposals/retirements
At 31 December 2022
Net book amounts
At 31 December 2021
At 31 December 2022
Intangible assets
Right-of-use assets
At 31 December 2022
28,127
(9)
2,405
(490)
30,033
8,053
11,914
10,775
1,139
11,914
188
–
241
–
(10)
419
419
(10)
910
–
91
–
1,124
–
–
–
30
699
–
–
44,776
34
4,705
(156)
(7)
1,215
729
49,352
1,215
–
1,124
–
2,339
729
36
674
–
49,352
17
5,114
(490)
1,439
53,993
153
18,709
–
1
–
–
–
–
154
18,709
1,319
–
35
35
–
35
423,643
2,495
10,023
2,397
446,611
482,981
1,728
8,899
1,883
507,440
482,981
–
482,981
1,728
–
1,728
8,899
–
8,899
1,883
506,301
–
1,139
1,883
507,440
153
154
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 10
Intangible assets continued
10
Intangible assets continued
Acquisitions of €60,847,000 comprise of the following transactions (Note 35):
» Goodwill of €23,400,000 arising on the acquisition of 85% of the ordinary share capital of BModesto Vastgoed B.V.
» Goodwill of €18,195,000 arising on the acquisition of 100% of the membership interests of Inspired Insight, LLC
» Goodwill of €6,548,000 arising on the acquisition of 100% of the ordinary share capital of Orspec Pharma Pty Limited
» Goodwill of €4,261,000 arising on the acquisition of 100% of the ordinary share capital of Chansey Holdings and
Edenmore Pharmacy Limited
» Goodwill of €3,824,000 arising on the acquisition of 100% of the ordinary share capital of Lanesra Pharmacy Limited
» Goodwill of €1,700,000 arising on the acquisition of 100% of the ordinary share capital of Mainarch Limited
» Goodwill of €1,259,000 arising on the purchase of the assets and trade of Young’s Pharmacy
» Goodwill of €845,000 arising on the acquisition of 100% of the ordinary share capital of Boxted Limited
» Goodwill of €479,000 arising on the acquisition of 100% of the ordinary share capital of Dr Hauschka Limited
» Goodwill of €336,000 arising on the acquisition of the remaining shareholding of IPOS Holding 97 Limited
The Group continues to have a registered trademark known as Life Pharmacy. This trademark is used by customers
of Uniphar who operate under the common symbol of Life Pharmacy and this trademark symbol is a central part of
developing the Life brand. The trademark is now fully amortised.
The Group recognised a customer relationship asset on the acquisitions of Diligent Health Solutions, LLC and RRD
International, LLC in 2020. Amortisation of these assets commenced at the date of acquisition, and they are being
amortised over the remaining useful life of five years.
The Group recognised a technology asset on the acquisition of Innerstrength Limited and BESTMSLs Group in 2020
and 2021 respectively. The brand name intangible asset was recognised on the acquisition of the Hickey’s Pharmacy
Group in 2020. Amortisation of these assets commenced at the date of acquisition, and they are being amortised over
the remaining useful life ranging from three to ten years.
Included in the cost of additions for 2022 is €9,000 (2021: €nil) incurred in respect of borrowing costs capitalised
into Computer Software.
Cash-generating units
Goodwill acquired in business combinations is allocated, at acquisition, to the cash-generating units (CGUs) that are
expected to benefit from that business combination, based on the Group’s existing CGUs or where more appropriate
the recognition of a new CGU. The CGUs represent the lowest level at which the associated goodwill is assessed for
internal management purposes and are not larger than the operating segments determined in accordance with IFRS 8
Operating Segments.
As disclosed in Note 35, the initial accounting for the business combinations completed during the year has been
determined provisionally. For 31 December 2022, the goodwill arising on business combinations completed during 2022
has been tested for impairment by reference to the CGUs, determined in accordance with the businesses acquired.
During 2022, the goodwill arising on acquisitions has been allocated to the CGUs that are expected to benefit from
that business combination. The goodwill arising on the acquisition of BModesto Group and Orspec Pharma has
been allocated to the Product Access CGU, whilst the goodwill arising on the acquisition of Inspired Health has been
allocated to the Commercial & Clinical Pharma CGU. The goodwill arising on the independent community pharmacy
(ICP) and Dr Hauschka Limited acquisitions has been allocated to the Supply Chain and Retail Pharmacies CGUs,
based on where the benefits of the acquisition are expected to arise.
Commercial & Clinical MedTech
Product Access
Commercial & Clinical Pharma
Retail Pharmacies
Supply Chain Services
Net book value of goodwill at 31 December
2022
€’000
2021
€’000
171,243
100,770
87,656
77,287
46,025
171,625
71,949
69,459
67,041
43,569
482,981
423,643
Impairment testing of goodwill
Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in
circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
An impairment loss is recognised for the amount by which the carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from other assets or groups of assets (CGUs).
The recoverable amount of each CGU is determined based on value-in-use calculations. The carrying value of each
CGU is initially compared to its estimated value-in-use. There were no impairments during the year (2021: €nil).
Value-in-use calculations
The value-in-use is calculated on the basis of estimated future cash flows discounted to present value. Estimated future
cash flows were determined by reference to the budget for the period 2023 to 2024 and management forecasts for each
of the following years from 2025 to 2027 inclusive. The terminal value was calculated using a long-term growth rate in
respect of the years after 2027. The estimates of future cash flows were based on consideration of past experience,
together with an assessment of the future prospects for each of the businesses within the CGUs. The assumptions used
are also referenced against external industry data.
The key assumptions used in the value-in-use calculations are the discount rate, the long-term growth rate, and the
cash flow forecasts. The pre-tax discount rates used were based on the Group’s estimated weighted average cost of
capital, adjusted to reflect risks associated with each CGU. The discount rates determined for each CGU are outlined
in the table below. In determining the terminal value of the value-in-use, it was assumed that cash flows after the first
five years will increase at a long-term growth rate ranging from 1.3% to 1.8% (2021: 2.0% to 2.5%). The rate assumed
was based on an assessment of the likely long-term growth prospects of the individual CGUs based on the weighted
average growth rate by geographies in which the CGU operates.
Commercial & Clinical MedTech
Supply Chain Services
Commercial & Clinical Pharma
Retail Pharmacies
Product Access
Discount
Rates
2022
Discount
Rates
2021
11.4%
8.7%
11.9%
9.1%
11.3%
10.0%
10.0%
10.0%
10.0%
10.0%
The value-in-use calculations assume that the markets in which each CGU operates will grow in accordance with
publicly available data, the Group will maintain its current market share, gross margin percentage will be maintained
at current levels and overheads will increase in line with expected levels of inflation. The cash flow forecasts assume
appropriate levels of capital expenditure and investment in working capital to support the growth in individual CGUs.
155
156
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 10
Intangible assets continued
Fair value less cost of disposal calculations
The fair value less cost of disposal calculations are only prepared when the value-in-use calculations indicate a potential
impairment. At the Balance Sheet date the value-in-use calculations did not indicate any potential impairment so no fair
value less cost of disposal calculations were required.
The fair value less cost of disposal is calculated as the maintainable EBITDA of each CGU multiplied by the appropriate
EBITDA valuation multiple attributable to that CGU. The fair value measurement is considered a Level 3 fair value based
on certain unobservable pricing inputs.
Sensitivity Analysis
The Group has conducted a sensitivity analysis on each of the CGUs by applying the following sensitivities; decreasing
free cash flows by 10%, increasing discount rates by 1%, and reducing long-term growth rates by 1%.
This analysis resulted in an excess in the recoverable amount over their carrying amount under each approach for all
CGUs. Management believe that any reasonable change in any of the key assumptions would not cause the carrying
value of goodwill to exceed the recoverable amount.
COMPANY
Cost
At 1 January 2022
Additions
At 31 December 2022
Accumulated amortisation
At 1 January 2022
Charge for the year
At 31 December 2022
Net book amounts
At 1 January 2022
At 31 December 2022
Intangible asset
Right-of-use assets
Net book value at 31 December 2022
Computer
Software
€’000
1,899
2,137
4,036
380
541
921
1,519
3,115
1,976
1,139
3,115
Total
€’000
1,899
2,137
4,036
380
541
921
1,519
3,115
1,976
1,139
3,115
l
a
t
o
T
s
t
n
e
m
u
r
t
s
n
I
r
o
t
o
M
l
s
e
c
h
e
v
i
r
e
t
u
p
m
o
C
t
n
e
m
p
u
q
e
i
d
n
a
s
e
r
u
t
x
F
i
d
n
a
t
n
a
P
l
l
d
o
h
e
s
a
e
L
l
d
o
h
e
e
r
F
s
g
n
i
t
t
fi
t
n
e
m
p
u
q
e
i
s
t
n
e
m
e
v
o
r
p
m
i
d
n
a
d
n
a
l
s
t
e
s
s
a
e
s
u
-
f
o
-
t
h
g
i
r
d
n
a
i
,
t
n
e
m
p
u
q
e
d
n
a
t
n
a
p
l
,
y
t
r
e
p
o
r
P
1
1
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
s
g
n
d
i
l
i
u
b
4
6
6
2
,
1
5
7
1
,
9
1
8
7
5
,
1
)
2
4
7
,
6
(
5
8
6
,
7
9
1
6
6
9
,
2
1
2
)
6
9
7
(
9
0
8
,
6
2
5
7
6
,
1
1
)
0
1
8
,
9
(
6
6
9
,
2
1
2
4
4
8
,
0
4
2
–
7
4
8
,
3
7
3
1
,
2
–
)
2
7
9
(
–
2
1
0
,
5
–
2
1
0
,
5
1
2
1
,
2
–
)
5
6
5
(
8
6
5
,
6
0
8
4
,
7
5
5
1
5
6
4
,
2
9
2
1
)
3
9
8
,
1
(
–
6
3
3
,
8
6
3
3
,
8
)
3
0
1
(
9
5
0
,
2
9
8
4
)
6
5
9
,
2
(
5
2
8
,
7
9
4
5
,
5
7
6
8
5
5
,
1
1
)
2
9
2
(
6
1
2
9
9
0
,
7
)
6
(
8
1
6
5
9
9
9
0
,
7
)
5
2
3
,
1
(
2
4
7
,
6
7
7
1
4
5
3
,
1
8
4
1
)
4
8
2
(
4
2
1
6
2
5
,
1
1
5
4
0
,
3
1
5
4
0
,
3
1
)
9
1
1
(
8
7
3
,
2
2
1
3
)
4
2
4
,
1
(
2
9
1
,
4
1
4
6
1
7
0
4
,
6
1
8
2
,
9
2
–
)
7
4
6
,
1
(
)
5
8
5
,
4
(
0
2
6
,
9
2
0
2
6
,
9
2
)
2
2
1
(
0
6
2
,
1
1
1
6
6
)
7
5
7
,
1
(
2
6
6
,
9
3
6
7
7
,
9
6
2
2
,
0
3
1
4
5
6
9
3
–
)
8
1
(
1
4
9
,
3
9
4
1
,
4
1
)
7
3
(
4
8
0
,
2
9
4
1
,
4
1
–
)
3
1
(
9
4
6
8
5
8
,
4
0
0
3
,
1
8
0
3
)
6
3
6
,
1
(
5
0
7
,
5
3
1
)
9
0
4
(
1
5
9
,
5
5
9
1
,
0
1
)
0
7
7
,
1
(
5
0
7
,
5
3
1
t
n
e
m
e
v
o
m
e
g
n
a
h
c
x
e
i
n
g
e
r
o
F
1
2
0
2
y
r
a
u
n
a
J
1
t
A
)
5
3
e
t
o
N
(
s
n
o
i
t
i
s
u
q
c
A
i
s
n
o
i
t
i
d
d
A
P
U
O
R
G
t
s
o
C
s
t
n
e
m
e
r
i
t
e
r
/
s
a
s
o
p
s
D
l
i
t
n
e
m
e
v
o
m
e
g
n
a
h
c
x
e
i
n
g
e
r
o
F
2
2
0
2
y
r
a
u
n
a
J
1
t
A
)
5
3
e
t
o
N
(
s
n
o
i
t
i
s
u
q
c
A
i
s
n
o
i
t
i
d
d
A
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
s
t
n
e
m
e
r
i
t
e
r
/
s
a
s
o
p
s
D
l
i
i
n
o
i
t
a
c
fi
s
s
a
c
e
R
l
3
8
1
,
6
1
2
7
6
,
9
4
1
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
157
158
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
0
4
9
,
3
4
9
9
4
5
2
2
,
2
2
)
3
1
5
,
6
(
4
2
3
5
7
4
,
0
6
5
7
4
,
0
6
)
4
2
4
(
6
5
3
,
3
2
)
1
9
1
,
9
(
6
1
2
,
4
7
1
9
4
,
2
5
1
8
2
6
,
6
6
1
1
4
6
,
5
5
7
8
9
,
0
1
1
8
2
6
,
6
6
1
6
3
7
,
1
–
7
1
6
,
1
)
0
6
9
(
–
3
9
3
,
2
–
3
9
3
,
2
9
1
6
,
1
)
5
6
5
(
7
4
4
,
3
9
1
6
,
2
1
2
1
,
3
–
1
2
1
,
3
1
2
1
,
3
7
7
9
3
1
,
3
9
0
7
,
2
)
3
7
8
,
1
(
–
2
5
0
,
4
)
3
5
(
2
5
0
,
4
7
8
4
,
2
)
5
3
6
,
2
(
1
5
8
,
3
4
8
2
,
4
4
7
9
,
3
3
3
5
1
4
4
,
3
4
7
9
,
3
9
8
4
,
3
1
3
4
2
0
,
1
)
4
8
2
(
1
1
1
7
2
,
4
)
5
1
(
1
7
2
,
4
6
1
1
,
1
)
5
7
2
,
1
(
7
9
0
,
4
8
2
8
,
2
5
4
6
,
2
–
5
4
6
,
2
5
4
6
,
2
8
3
2
,
4
3
9
3
7
7
,
1
)
2
6
2
(
5
7
4
8
,
5
)
2
8
(
7
4
8
,
5
4
8
8
,
1
)
4
0
4
,
1
(
5
4
2
,
6
8
9
1
,
7
7
4
9
,
7
–
7
4
9
,
7
7
4
9
,
7
–
4
0
3
,
4
1
7
8
6
9
0
,
3
)
4
4
6
,
1
(
3
4
8
,
5
1
3
4
8
,
5
1
)
0
0
1
(
6
9
3
,
3
)
2
4
7
,
1
(
7
9
3
,
7
1
7
7
7
,
3
1
5
6
2
,
2
2
8
7
2
7
8
9
,
1
2
5
6
2
,
2
2
1
6
9
,
1
1
3
4
4
1
,
1
)
0
1
(
3
1
9
3
1
,
3
9
3
1
,
3
)
4
2
(
0
2
5
,
1
)
3
1
(
2
2
6
,
4
0
1
0
,
1
1
1
6
5
,
1
1
–
1
6
5
,
1
1
0
0
0
’
€
s
g
n
d
i
l
i
u
b
3
7
0
,
5
1
0
8
1
2
6
8
,
0
1
)
0
8
4
,
1
(
5
9
2
0
3
9
,
4
2
0
3
9
,
4
2
)
0
5
1
(
4
3
3
,
1
1
)
7
5
5
,
1
(
7
5
5
,
4
3
5
7
7
,
0
1
1
5
1
1
,
5
1
1
7
4
8
,
7
8
6
2
,
7
0
1
i
n
o
i
t
a
c
e
r
p
e
d
d
e
t
a
u
m
u
c
c
A
l
t
n
e
m
e
v
o
m
e
g
n
a
h
c
x
e
i
n
g
e
r
o
F
r
a
e
y
e
h
t
r
o
f
e
g
r
a
h
C
1
2
0
2
y
r
a
u
n
a
J
1
t
A
P
U
O
R
G
s
t
n
e
m
e
r
i
t
e
r
/
s
a
s
o
p
s
D
l
i
t
n
e
m
e
v
o
m
e
g
n
a
h
c
x
e
i
n
g
e
r
o
F
r
a
e
y
e
h
t
r
o
f
e
g
r
a
h
C
2
2
0
2
y
r
a
u
n
a
J
1
t
A
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
s
t
n
e
m
e
r
i
t
e
r
/
s
a
s
o
p
s
D
l
i
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
1
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
s
t
n
u
o
m
a
k
o
o
b
t
e
N
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
A
t
n
e
m
p
u
q
e
&
i
t
n
a
p
l
,
y
t
r
e
p
o
r
P
s
t
e
s
s
a
e
s
u
-
f
o
-
t
h
g
R
i
i
n
o
i
t
a
c
fi
s
s
a
c
e
R
l
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
0
0
0
’
€
l
a
t
o
T
s
t
n
e
m
u
r
t
s
n
I
r
o
t
o
M
l
s
e
c
h
e
v
i
r
e
t
u
p
m
o
C
t
n
e
m
p
u
q
e
i
d
n
a
s
e
r
u
t
x
F
i
d
n
a
t
n
a
P
l
l
d
o
h
e
s
a
e
L
l
d
o
h
e
e
r
F
s
g
n
i
t
t
fi
t
n
e
m
p
u
q
e
i
s
t
n
e
m
e
v
o
r
p
m
i
d
n
a
d
n
a
l
d
e
u
n
i
t
n
o
c
s
t
e
s
s
a
e
s
u
-
f
o
-
t
h
g
i
r
d
n
a
i
,
t
n
e
m
p
u
q
e
d
n
a
t
n
a
p
l
,
y
t
r
e
p
o
r
P
1
1
159
n
o
d
e
c
n
e
m
m
o
c
t
o
n
s
a
h
i
n
o
i
t
a
c
e
r
p
e
D
.
)
0
0
0
5
5
5
,
,
1
€
:
1
2
0
2
(
0
0
0
,
8
0
7
,
0
1
€
f
o
e
u
a
v
l
k
o
o
b
t
e
n
a
h
t
i
w
n
o
i
t
c
u
r
t
s
n
o
c
r
e
d
n
u
s
t
e
s
s
a
e
r
a
i
t
n
e
m
p
u
q
e
d
n
a
t
n
a
p
l
,
y
t
r
e
p
o
r
p
n
i
d
e
d
u
c
n
l
I
.
s
t
e
s
s
a
o
t
n
i
d
e
s
i
l
a
t
i
p
a
c
s
t
s
o
c
g
n
w
o
r
r
o
b
i
f
o
t
c
e
p
s
e
r
n
i
d
e
r
r
u
c
n
i
)
l
i
n
€
:
1
2
0
2
(
0
0
0
,
7
5
€
s
i
2
2
0
2
r
o
f
s
n
o
i
t
i
d
d
a
f
o
t
s
o
c
e
h
t
n
i
d
e
d
u
c
n
l
I
.
s
t
e
s
s
a
e
s
e
h
t
11 Property, plant and equipment, and right-of-use assets continued
Freehold
land and
buildings
€’000
Plant and
equipment
Total
€’000
€’000
COMPANY
Cost
At 1 January 2021
Additions
Disposals
At 31 December 2021
At 1 January 2022
At 31 December 2022
Accumulated depreciation
At 1 January 2021
Charge for the year
Disposals
At 31 December 2021
At 1 January 2022
Charge for the year
At 31 December 2022
Net book amounts
At 31 December 2021
At 31 December 2022
Property, plant & equipment
Right-of-use assets
Net book value at 31 December 2022
50,442
–
–
50,442
50,442
50,442
6,324
3,162
–
9,486
9,486
3,161
12,647
40,956
37,795
–
37,795
37,795
296
150
(64)
382
382
382
59
114
(63)
110
110
108
218
272
164
–
164
164
50,738
150
(64)
50,824
50,824
50,824
6,383
3,276
(63)
9,596
9,596
3,269
12,865
41,228
37,959
–
37,959
37,959
160
1
6
5
,
1
1
5
1
1
,
5
1
1
2
2
0
2
r
e
b
m
e
c
e
D
1
3
t
a
e
u
a
v
l
k
o
o
b
t
e
N
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
12 Financial assets
12 Financial assets continued
Long-term receivables
Investments
in equity
instruments
€’000
Loans to
IPOS entities
and other
loans
€’000
Loans to
retail holding
companies
Total
€’000
€’000
353
353
353
(199)
154
328
328
328
(199)
129
25
25
17
17
17
(17)
–
17
17
17
(17)
–
–
–
9,249
9,249
9,249
(9,249)
–
9,249
9,249
9,249
(9,249)
–
–
–
9,266
9,266
9,266
(9,266)
–
9,266
9,266
9,266
(9,266)
–
–
–
Long-term receivables
Shares in
subsidiary
companies
Investments
in equity
instruments
€’000
€’000
Loans to
IPOS entities
and other
loans
€’000
Loans to
retail holding
companies
Total
€’000
€’000
COMPANY
Cost
At 1 January 2021
Additions
At 31 December 2021
At 1 January 2022
Additions
Disposals
At 31 December 2022
Provision for impairment
At 1 January 2021
At 31 December 2021
At 1 January 2022
Disposals
At 31 December 2022
Net book amounts
At 31 December 2021
At 31 December 2022
293,297
93
293,390
293,390
44,342
(532)
337,200
1,890
1,890
1,890
(179)
1,711
291,500
335,489
224
–
224
224
–
(199)
25
199
199
199
(199)
–
25
25
17
–
17
17
–
(17)
–
17
17
17
(17)
–
–
–
9,249
–
9,249
9,249
–
(9,249)
–
9,249
9,249
9,249
(9,249)
–
–
–
9,266
–
9,266
9,266
–
(9,266)
–
9,266
9,266
9,266
(9,266)
–
–
–
162
GROUP
Cost
At 1 January 2021
At 31 December 2021
At 1 January 2022
Disposals
At 31 December 2022
Provision for impairment
At 1 January 2021
At 31 December 2021
At 1 January 2022
Disposals
At 31 December 2022
Net book amounts
At 31 December 2021
At 31 December 2022
161
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
12 Financial assets continued
13 Deferred tax asset
GROUP AND COMPANY
Investments in equity instruments
The fair value of €25,000 (2021: €25,000) is represented by the Group’s investment in Independent Life Pharmacy plc
(Life) comprising of 84 A ordinary shares of €0.01 each and 25,000 C shares of €1.00 each. The C shares are non-voting
and do not confer any dividend entitlement. Independent Life Pharmacy plc represents the Life symbol group and is
owned jointly by pharmacy owners through B shares and Uniphar plc through A shares. The pharmacy owners are
entitled to nominate the majority of the Directors to the Life Board in addition to Uniphar nominees.
Fully impaired equity investments with a cost of €199,000 were dissolved during the year with a corresponding release
of the impairment provision.
Loans to retail holding and management companies
These loans represent amounts advanced to Riverchem DAC and Inischem DAC. As the companies have been
dissolved, the investments have been written off as disposals in the year ended 31 December 2022 with a
corresponding release of the impairment provision.
COMPANY
Shares in subsidiary companies
Financial assets of the parent company, Uniphar plc, include shares in subsidiary companies with a net book value of
€335,489,000 (2021: €291,500,000). The main movements in 2022 and 2021 were:
» Additions of €44,342,000 in 2022 (2021: €93,000) relates to the allotment of one additional share in Uniphar Durbin
Ireland Limited (€44,152,000) and capital contributions to subsidiary companies in relation to share-based payment
expenses incurred on the subsidiaries’ behalf (€190,000) (2021: €93,000).
» Disposals of €353,000 (net of impairment) relate to the sale of the investment in IPOS Holding 97 Limited which was
disposed of to another Group company.
The following is an analysis of the movement in the major categories of deferred tax assets recognised by the Group
for the years ended 31 December 2022 and 2021:
GROUP
At 1 January 2021
Acquisitions
Recognised in Income Statement
Utilisation of loss relief
Reclassification
Translation adjustment
At 31 December 2021
At 1 January 2022
Acquisitions
Recognised in Income Statement
Utilisation of loss relief
Reclassification
Translation adjustment
At 31 December 2022
Deferred tax asset
Deferred tax liability
Employee
benefits
€’000
Property
plant and
equipment
€’000
Tax losses
Other
Total
€’000
€’000
€’000
77
–
38
–
44
10
169
169
–
917
–
–
(62)
1,024
1,024
–
1,024
422
–
(148)
–
–
–
5,119
–
47
(1,566)
(44)
63
(1,685)
(663)
35
–
–
(15)
3,933
(663)
(28)
(1,566)
–
58
274
3,619
(2,328)
1,734
274
–
(220)
–
–
143
197
413
(216)
197
3,619
207
995
(1,108)
29
(255)
(2,328)
6,550
463
–
(29)
(344)
1,734
6,757
2,155
(1,108)
–
(518)
3,487
4,312
9,020
3,487
–
3,487
6,263
(1,951)
11,187
(2,167)
4,312
9,020
The deferred tax asset in relation to losses reflects the Group’s expected utilisation of carried forward tax losses
associated with parent company activities, Irish nursing services, Dutch/UK outsourcing services and Product Access
businesses in Ireland and the UK.
The other deferred tax asset of €4,312,000 relates to:
» the recognition of a goodwill tax asset of €6,162,000 amortisable over 15 years following the qualified stock purchase
of Inspired Insight, LLC in September 2022.
» the recognition of a deferred tax asset associated with parent company interest tax deductibility of €101,000.
» an expected future tax liability of €517,000 associated with the EPS business in Sweden where the taxing authority
allows the deferring of a percentage of current profits for taxing in future years.
» the recognition of a tax liability of €557,000 associated with the tax amortisation benefit attributed to the Hickey’s
brand name.
» the recognition of a tax liability of €356,000 associated with acquired Customer Relationships arising on the
acquisitions of Diligent Health Solutions, LLC and RRD International, LLC.
» the recognition of a tax liability of €329,000 associated with acquired Technology Assets arising on the acquisition
of the BESTMSLs Group.
» the recognition of miscellaneous deferred tax liabilities of €192,000 associated with other Uniphar US and
UK companies.
163
164
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 13 Deferred tax asset continued
14 Assets held for sale
In 2021, the other deferred tax liability of €2,328,000 related to an expected future tax liability of €561,000 associated
with the EPS business in Sweden, a tax liability of €627,000 associated with the tax amortisation benefit attributed to
the Hickey’s brand name, a tax liability of €453,000 associated with acquired Customer Relationships arising on the
acquisitions of Diligent Health Solutions, LLC and RRD International, LLC and the recognition of a deferred tax liability
of €687,000 arising on the acquisitions of BESTMSLs Group and Events 4 Healthcare in 2021.
The Group has potentially a deferred tax asset of €7,705,000 (2021: €6,633,000) arising from losses forward.
The Directors believe sufficient taxable profits to utilise these potential assets will arise in the future, but that there
is currently insufficient evidence to support the recognition of a deferred tax asset. These balances may be carried
forward indefinitely under current tax law and are available for offset against future profits and gains generated by
the companies which hold the losses.
COMPANY
At 1 January 2021
Recognised in Income Statement
Tax losses surrendered to other Irish Group companies
At 31 December 2021
At 1 January 2022
Recognised in Income Statement
Tax losses surrendered to other Irish Group companies
At 31 December 2022
Deferred
tax asset
€’000
2,232
413
(774)
1,871
1,871
574
(353)
2,092
The Company’s deferred tax asset relates to expenses of management associated with its investment activities,
employee benefits and interest charges. The Directors believe that sufficient taxable profits will arise in the future
to utilise these deferred tax assets.
GROUP
At 1 January 2021
Disposals
Impairment
At 31 December 2021
At 1 January 2022
At 31 December 2022
Properties
€’000
2,300
(350)
(350)
1,600
1,600
1,600
Properties held for sale relate to properties acquired on completion of the acquisition of Bradley’s Pharmacy Group
in November 2018. These properties are presented in the Balance Sheet at the lower of their carrying amount and fair
value less any costs to sell. Uniphar plc acquired Bradley’s Pharmacy Group from examinership in November 2018,
and in accordance with the application of the examinership scheme arrangement acquired non-recourse borrowings
of €4,000,000 which are secured by these properties. These borrowings have a carrying value of €1,600,000 at
31 December 2022 (2021: €1,600,000).
During 2022, the Group disposed of €nil (2021: €350,000) of property which were previously held for sale. There was
no impairment on the value of the remaining property (2021: €350,000) nor was there a corresponding write down of
the associated bank borrowings (2021: €350,000). The remaining property held for sale is available for immediate sale
in its present condition subject to terms that are usual and customary for property of this nature. The property is being
actively marketed and the Group is committed to its plan to sell this property in an orderly manner.
15
Inventory
GROUP
Goods for resale
2022
€’000
2021
€’000
157,656
112,407
The replacement cost of inventories did not differ materially from the Balance Sheet amounts at 31 December 2022
and 31 December 2021.
Inventory stated above is net of impairment provision of €7,210,000 (2021: €8,520,000). Reversals of previous write
downs of inventories recognised as a gain during 2022 amounted to €1,310,000 (expense in 2021: €3,543,000)
following a review of the inventory profile at the Balance Sheet date.
In 2022, goods for resale recognised as cost of sales amounted to €1,677,208,000 (2021: €1,567,470,000).
165
166
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 16 Trade and other receivables
16 Trade and other receivables continued
2022
€’000
2021
€’000
Current trade and other receivables
Deferred consideration receivable
GROUP
Trade receivables
Prepayments
Accrued income
Other receivables
Deferred consideration receivable
Corporation tax
COMPANY
Amounts due from subsidiaries
Prepayments
Other receivables
Value added tax
Corporation tax
Deferred consideration receivable
142,050
129,468
4,808
12,999
4,255
100
–
5,250
9,004
7,246
448
362
164,212
151,778
284,306
266,428
732
205
335
113
100
592
167
230
113
121
1,485
1,223
285,791
267,651
Amounts due from subsidiaries are unsecured and are repayable on demand.
Tax is repayable at various dates over the coming months in accordance with the applicable statutory provisions.
Details of the provision for impairment of trade and other receivables are outlined in Note 32.
2022
€’000
2021
€’000
509
509
244
244
388
388
202
202
Non-current trade and other receivables
GROUP
Other receivables
COMPANY
Other receivables
167
2022
€’000
2021
€’000
100
100
100
100
448
448
121
121
GROUP
Within one year
COMPANY
Within one year
The deferred consideration receivable of €100,000 (2021: €448,000) relates to a contractual amount due from the
disposal of IPOS Holding 162 Limited.
17 Cash and cash equivalents
Cash and cash equivalents consist of the following:
GROUP
Cash at bank and in hand
COMPANY
Cash at bank and in hand
2022
€’000
2021
€’000
103,704
78,025
103,704
78,025
2,761
2,761
2,105
2,105
Reconciliation to Cash Flow Statement
The cash and cash equivalents shown in the Cash Flow Statement at the end of the financial year is reconciled
as follows:
GROUP
Cash and cash equivalents
COMPANY
Cash and cash equivalents
2022
€’000
2021
€’000
103,704
78,025
2,761
2,105
168
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 18 Borrowings
19 Provisions
Bank loans are repayable in the following periods after 31 December:
GROUP
» Amounts falling due within one year
» Amounts falling due between one and five years
COMPANY
» Amounts falling due within one year
» Amounts falling due between one and five years
2022
€’000
2021
€’000
7,490
187,431
1,721
124,601
194,921
126,322
–
–
187,431
124,601
187,431
124,601
The Group’s total bank loans at 31 December 2022 were €194,921,000 (2021: €126,322,000). Borrowing under invoice
discounting (recourse) as at the balance sheet date was €5,890,000 (2021: €nil). Bank loans falling due within one
year include €1,600,000 (2021: €1,600,000) of loans arising on the acquisition of Bradley’s Pharmacy Group which are
secured by properties acquired on the acquisition which are classified as held for sale. Following the disposal of these
properties these loans are required to be repaid (Note 14).
The Group entered into a new facility in August 2022. The total loan value of the revolving credit facility available for use
within this agreement is €400,000,000, with an additional uncommitted accordion facility of €150,000,000. This facility
runs for five years to 2027 with two options to extend by a further one year, with repayment of all loans on termination
of the facility currently in August 2027.
At 31 December 2022, the Group’s revolving credit facility loans in use were at an interest margin of +1.5%
(2021: +1.5%) on inter-bank interest rates (EURIBOR, GBP SONIA and USD SOFR).
The Company’s total bank loans at 31 December 2022 were €187,431,000 (2021: €124,601,000). At 31 December 2022,
they were subject to an interest rate margin of +1.5% (2021: +1.5%) on inter-bank interest rates (EURIBOR, GBP SONIA
and USD SOFR).
Bank security
Bank overdrafts (including invoice discounting) and bank loans of €194,921,000 (2021: €126,322,000) are secured
by cross guarantees and fixed and floating charges from the Company and certain subsidiary undertakings.
Deferred
contingent
consideration
2022
€’000
Lease
dilapidation
Warranty
provision
Other
Total
Total
2022
€’000
2022
€’000
2022
€’000
2022
€’000
2021
€’000
GROUP
At 1 January
Recognised during the year
Unwinding of discount
Arising on acquisition
Utilised during the year
Released during the year
Change in discount rate
Foreign currency movement
At 31 December
88,918
–
2,073
17,519
(5,127)
(12,030)
(1,405)
1,850
91,798
523
–
–
–
–
(35)
–
–
488
77
64
–
–
–
–
–
(8)
133
883
1,665
–
–
(952)
–
–
45
90,401
1,729
2,073
17,519
(6,079)
(12,065)
(1,405)
1,887
86,768
5,682
1,863
29,195
(13,283)
(24,592)
–
4,768
1,641
94,060
90,401
Deferred contingent consideration represents the present value of deferred contingent acquisition consideration which
would become payable based on pre-defined profit thresholds being met. During the year payments of €5,127,000
(2021: €13,283,000) were made in respect of prior year acquisitions. Deferred contingent consideration of €12,030,000
(2021: €24,592,000) in respect of prior year acquisitions were released in the year following a review of expected
performance against earn-out targets. The discount rates used to discount the provisions to present value were
updated at 31 December 2022 resulting in a credit of €1,405,000 being recognised as an exceptional item in the 2022
Income Statement (2021: €nil). Further details on the measurement of deferred contingent consideration are provided
in Note 32. The balance at 31 December 2022 relates to the following acquisitions:
» Dialachemist Limited (2015)
» Macromed (UK) Limited (2018)
» EPS Vascular AB, EP Endovascular AB and EPS Vascular OY (EPS Group) (2019)
» M3 Medical Limited (2019)
» Innerstrength Limited (2020)
» Diligent Health Solutions, LLC (2020)
» RRD International, LLC (2020)
» CoRRect Medical GmbH (2021)
» MDea, Inc, The Doctor’s Channel, LLC, and BESTMSLs, Inc (BESTMSLs Group) (2021)
» Events 4 Healthcare Limited (2021)
» Devonshire Healthcare Services Limited (2021)
» Inspired Insight, LLC (2022)
» Orspec Pharma Pty Limited (2022)
» BModesto Vastgoed B.V. (2022)
169
170
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 19 Provisions continued
20 Employee benefit surplus
The deferred contingent consideration at 31 December 2021 related to the acquisition of the following:
» Dialachemist Limited (2015)
» Macromed (UK) Limited (2018)
» EPS Vascular AB, EP Endovascular AB and EPS Vascular OY (EPS Group) (2019)
» M3 Medical Limited (2019)
» Innerstrength Limited (2020)
» Diligent Health Solutions, LLC (2020)
» RRD International, LLC (2020)
» CoRRect Medical GmbH (2021)
» MDea, Inc, The Doctor’s Channel, LLC, and BESTMSLs, Inc (BESTMSLs Group) (2021)
» Events 4 Healthcare Limited (2021)
» Devonshire Healthcare Services Limited (2021)
The maturity profile of the deferred contingent consideration at 31 December 2022 is outlined in Note 32.
Lease dilapidation
The lease dilapidation provision covers the cost of reinstating certain Group properties at the end of the lease term.
This is based on the terms of the individual leases which set out the conditions relating to the return of property.
The timing of the outflows will match the ending of the relevant leases with various dates up to 2049.
Warranty provision
The warranty provision relates to a product warranty provided to customers on certain medical devices. The estimated
cost of the warranty is provided for upon recognition of the sale of the product. The costs are estimated based on
actual historical experience of expenses incurred and on estimated future expenses related to current sales and are
updated periodically. Actual warranty costs are charged against the warranty provision.
Other
Other provisions relate to a management retention bonus payable in relation to the acquisition of RRD International, LLC
in 2020.
The remaining defined benefit plan was wound up in March 2021. The pension entitlements of employees, including
Executive Directors, now arise under a number of defined contribution schemes and are secured by contributions
by the Group to separate trustee administered pension funds. In 2021, a settlement loss of €211,000 was recognised
on the closure of the Cahill May Roberts Group Pension Scheme. The assets of the scheme were distributed in line
with members chosen options and no assets or liabilities remain.
The defined benefit scheme was:
» The Cahill May Roberts Limited Contributory Pension Plan (wound up in March 2021)
The pension charge for the year is €4,058,000 (2021: €4,313,000) which relates to the defined contribution schemes.
The funding requirements in relation to the Group’s defined benefit scheme in the prior year were assessed in
accordance with the advice of independent qualified actuaries and valuations were prepared at triennial intervals.
Annual contributions were based on the advice of professionally qualified actuaries using the projected unit method.
The actuarial valuation reports are available for inspection by members of the scheme at the registered office of the
Company but are not available for public inspection.
The amounts recognised in the Income Statement for the year ended 31 December are as follows:
Credited/(charged) to finance cost
Interest on pension scheme assets
Interest on pension scheme liabilities
Net finance cost
2022
€’000
2021
€’000
–
–
–
7
(7)
–
COMPANY
Deferred contingent consideration:
At 1 January
Arising on acquisition
Unwinding of discount
Utilised during the year
Released during the year
Change in discount rate
Foreign currency movement
At 31 December
2022
€’000
2021
€’000
The actual return on scheme assets is a gain/loss of €nil (2021: loss of €145,000).
The amounts recognised in the Statement of Comprehensive Income for the year ended 31 December are as follows:
2,428
32,440
Analysis of amount recognised in Statement of Comprehensive Income
–
49
–
–
(15)
–
2,462
701
653
(8,147)
(24,592)
–
1,373
2,428
Actual return less amounts included in interest and expense
Experience gains/(losses) arising on the scheme liabilities
Changes in financial assumptions underlying the present value of the scheme
assets and liabilities
Actuarial (loss)/gain in the year
2022
€’000
2021
€’000
–
–
–
–
(152)
45
98
(9)
Deferred contingent consideration represents the present value of deferred contingent acquisition consideration which
would become payable based on pre-defined profit thresholds being met. No payments were made during the year in
respect of prior year acquisitions (2021: €8,147,000). The balance at 31 December 2022 and 31 December 2021 relates
to the acquisition of Innerstrength Limited in 2020.
171
172
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 20 Employee benefit surplus continued
Movement in scheme assets and liabilities
At 1 January 2021
Settlement loss
Employer contributions paid
Interest on scheme liabilities
Interest on scheme assets
Actuarial (loss)/gain in current year
Benefits (paid)/settled
At 31 December 2021
At 31 December 2022
Pension
assets
Pension
liabilities
€’000
€’000
Pension
surplus/
(deficit)
€’000
11,697
(11,685)
–
208
–
7
(152)
(11,760)
–
–
(211)
–
(7)
–
143
11,760
–
–
12
(211)
208
(7)
7
(9)
–
–
–
All of the scheme liabilities arose from schemes that were wholly or partly funded.
Experience gains/(losses) on scheme liabilities:
Amount (€’000)
Percentage of the present value of the scheme liabilities
Difference between the actual and expected return on scheme assets:
Amount (€’000)
Percentage of scheme assets
2022
€’000
2021
€’000
–
0.00%
45
0.00%
–
0.00%
(152)
0.00%
Defined contribution scheme
Included in accruals and other payables is an amount of €516,000 (2021: €424,000) due in relation to the defined
contribution schemes.
21 Leases
(i) Amounts recognised in the Balance Sheet
As at 31 December, the Balance Sheet shows the following amounts relating to leases:
GROUP
Right-of-use assets:
Buildings
Plant and equipment
Motor vehicles
Computer software
Net book value of right-of-use assets
Lease liabilities:
Current
Non-current
Total lease liabilities
2022
€’000
2021
€’000
107,268
105,766
278
3,441
1,139
686
4,196
1,519
112,126
112,167
14,315
105,919
14,358
104,720
120,234
119,078
Right-of-use assets are included in the lines ‘Intangible assets’ and ‘Property, plant and equipment, and right-of-use
assets’ on the Balance Sheet, and are presented in Notes 10 and 11.
Additions to the right-of-use assets during the year ended 31 December 2022 were €7,961,000 (2021: €9,519,000).
Lease liabilities are presented separately on the face of the Balance Sheet. The contractual maturity of the lease
liabilities is presented in Note 32.
COMPANY
Right-of-use assets:
Buildings
Plant and equipment
Computer software
Net book value of right-of-use assets
Lease liabilities:
Current
Non-current
Total lease liabilities
2022
€’000
2021
€’000
37,795
164
1,139
40,956
272
1,519
39,098
42,747
3,836
38,283
3,804
41,230
42,119
45,034
Right-of-use assets are included in the lines ‘Intangible Assets’ and ‘Property, plant and equipment, and right-of-use
assets’ on the Balance Sheet, and are presented in Notes 10 and 11.
Additions to the right-of-use assets during the year ended 31 December 2022 were €nil (2021: €2,049,000).
173
174
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
21 Leases continued
(ii) Amounts recognised in the Income Statement
The Income Statement shows the following amounts relating to leases:
GROUP
Buildings
Plant and equipment
Motor vehicles
Right-of-use assets depreciation charge
Computer software
Right-of-use assets amortisation charge
Interest on lease obligations (Note 6)
Principal repayments
Total cash outflow in respect of leases
COMPANY
Buildings
Plant and equipment
Right-of-use assets depreciation charge
Computer software
Right-of-use assets amortisation charge
Interest on lease obligations
Principal repayments
Total cash outflow in respect of leases
2022
€’000
2021
€’000
11,131
414
2,434
10,657
548
2,660
13,979
13,865
380
380
380
380
3,644
13,192
3,772
12,853
16,836
16,625
2022
€’000
3,161
108
3,269
380
380
1,316
2,916
4,232
2021
€’000
3,162
115
3,277
380
380
1,403
2,834
4,237
22 Trade and other payables
GROUP
Trade payables
Accruals
Other payables
Employment related taxes
Value added tax
Deferred acquisition consideration
2022
€’000
2021
€’000
223,249
155,255
12,989
4,863
10,327
523
186,892
146,892
8,563
4,450
6,602
4,295
407,206
357,694
Trade and other payables are payable at various dates in the next three months in accordance with the suppliers’ usual
and customary credit terms.
Taxes are payable at various dates over the coming months in accordance with the applicable statutory provisions.
COMPANY
Amounts owed to subsidiaries
Trade payables
Accruals
Other payables
Employment related taxes
2022
€’000
2021
€’000
147,060
143,015
2,863
18,543
917
493
698
14,591
389
393
22,816
16,071
169,876
159,086
Amounts owed to subsidiaries are unsecured, interest free and are repayable on demand.
Trade and other payables are payable at various dates in the next three months in accordance with the suppliers’ usual
and customary credit terms.
Taxes are payable at various dates over the coming months in accordance with the applicable statutory provisions.
Deferred acquisition consideration
Total deferred acquisition consideration is payable in the following periods after 31 December in the Group:
GROUP
» Within one year
» Between one and two years
2022
€’000
523
–
523
2021
€’000
4,295
–
4,295
Deferred acquisition consideration reflects the amounts payable relating to the acquisition of Orspec Pharma and an
independent community pharmacy. During 2022, payments were made in relation to deferred consideration on the
acquisition of Hickey’s Pharmacy Group and for an independent community pharmacy.
175
176
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
23 Called up share capital
25 Other reserves continued
GROUP AND COMPANY
Authorised share capital at 31 December:
Ordinary shares of 8c each
“A” ordinary shares of 8c each
Authorised share capital
2022
Number
2021
Number
2022
€’000
2021
€’000
453,205,300
453,205,300
16,000,000
16,000,000
36,256
1,280
36,256
1,280
37,536
37,536
Movement in the year in issued share capital presented as equity
Allotted, called up and fully paid ordinary shares of 8c each
At 1 January
At 31 December
Total allotted share capital:
At 31 December
2022
Number
2021
Number
2022
€’000
2021
€’000
273,015,254
273,015,254
21,841
21,841
273,015,254
273,015,254
21,841
21,841
Property revaluation reserve
The property revaluation reserve arose on the revaluation of freehold land and buildings. When revalued land and
buildings are sold, the portion of the property revaluation reserve that relates to that asset will be transferred directly
to retained earnings.
Foreign currency translation reserve
The foreign currency translation reserve comprises of all foreign exchange differences arising from the translation of the
net assets of the Group’s non-Euro denominated operations, including the translation of the profits of such operations
from the average exchange rate for the year to the exchange rate at the Balance Sheet date. The reserve also includes
all foreign exchange differences arising from the translation of borrowings that hedge the Group’s net investment
in foreign operations.
Capital redemption reserve
The capital redemption reserve is a legal reserve which has arisen from the Company buying back and cancelling
its ordinary shares in 2013.
26 Retained earnings
GROUP
At 1 January 2021
Profit for the financial year
273,015,254
273,015,254
21,841
21,841
Other comprehensive expense relating to the financial year
There have been no changes to the authorised or issued share capital in either 2022 or 2021.
24 Share premium
GROUP AND COMPANY
Premium arising on shares issued
25 Other reserves
GROUP
Property revaluation reserve
Foreign currency translation reserve
Capital redemption reserve
COMPANY
Capital redemption reserve
177
Dividend paid
At 31 December 2021
At 1 January 2022
Profit for the financial year
Dividend paid
At 31 December 2022
COMPANY
At 1 January 2021
Profit for the financial year
Dividend paid
At 31 December 2021
At 1 January 2022
Profit for the financial year
Dividend paid
At 31 December 2022
2022
€’000
2021
€’000
176,501
176,501
2022
€’000
700
1,248
60
2,008
60
60
2021
€’000
700
4,604
60
5,364
60
60
€’000
5,218
48,077
(9)
(5,731)
47,555
47,555
45,587
(4,666)
88,476
60,766
21,332
(5,731)
76,367
76,367
(5,233)
(4,666)
66,468
178
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 27 Non-controlling interests
28 Employee share awards continued
At 1 January
Share of post-acquisition profits
At 31 December
2022
€’000
120
119
239
2021
€’000
75
45
120
Non-controlling interests own the following stakes in the issued ordinary share capital of the entities set out below
at 31 December 2022:
» 25.0% Citywest Healthcare Limited
» 20.0% Dialachemist Limited
» 17.7% Innerstrength Limited
» 5.05% Macromed (UK) Limited
During the year, the Group acquired the remaining 26.6% of the issued ordinary share capital of IPOS Holding 97 Limited.
In November 2022, the Group acquired 85% of BModesto Vastgoed B.V. with the remaining 15% subject to a put and
call option. BModesto Vastgoed B.V. has been consolidated as a subsidiary undertaking using the anticipated acquisition
method, consistent with IFRS 3, with the combined 100% recognised as acquired from November 2022.
28 Employee share awards
Share based payments
Share options (equity-settled)
On 21 November 2022, the Board approved the adoption of a new share option plan (‘2022 Share Option Plan’) and the
closure of the 2021 Share Option Plan to new entrants. The new plan has a reserve of 5% of the issued share capital of
the Company plus the unallocated reserve from the 2021 Plan (which had an initial reserve of 2.5% of the issued share
capital of the Company and, at the time of closure of that Plan, awards in respect of 0.4% of the issued share capital
of the Company had been granted). The 2022 Share Option Plan is intended to incentivise key management and senior
employees and ensure alignment of incentives with the long-term interests of shareholders.
The key terms and conditions related to the grants under the 2022 and 2021 share option plans are as follows:
Grant date
Vesting conditions
Number of
instruments
in thousands
Contractual
life of option
March 2021
500 Service from the grant date to 31 December 2024,
7 years
meeting share thresholds of €3.30 per share, €4.00 per
share, €4.75 per share and €5.50 per share. (25% at
each hurdle vest’s subject to the service condition)
July 2021
250 Service from the grant date to 31 December 2024,
7 years
October 2021
July 2021
August 2021
November 2022
meeting share thresholds of €4.00 per share, €4.75 per
share and €5.50 per share. (33% at each hurdle vest’s
subject to the service condition)
250 Same as July 2021 vesting conditions
635 Same as July 2021 vesting conditions
35 Same as July 2021 vesting conditions
12,500 Service from grant date to 31 December 2026 meeting
Total Shareholder Return (TSR) thresholds achieved in
the vesting period ranging from 50% to 70%
7 years
7 years
7 years
10 years
Total share options granted
14,170
Cash LTIP (cash-settled)
On 10 June and 22 July 2021, the Group granted 200,000 and 120,000 cash LTIP awards to employees that entitled
them to a cash payment at 31 December 2024 based on the service provided up until this date. During the year ended
31 December 2021, all the cash LTIP awards in the grant dated 10 June 2021 were forfeited. The number of outstanding
cash LTIP awards at 31 December 2022 is 120,000 (2021: 320,000).
The amount of the cash payment is determined by the increase in the share price of the Company based on the share
price hurdles of €3.30, €4.00, €4.75 and €5.50 (25% at each hurdle vest’s subject to service conditions) for the cash
LTIP awards issued in June and share price hurdles of €4.00, €4.75 and €5.50 for the cash LTIP awards issued in July
(33% at each hurdle vest’s subject to service conditions). The carrying amount of liabilities for the cash LTIP awards at
31 December 2022 was €34,000 (2021: €28,000).
Measurement of fair values (equity-settled)
The fair value of the employee share option scheme has been measured using a Monte Carlo simulation. Service and
non-market performance conditions attached to the arrangements were not taken into account in measuring fair value.
The inputs used in the measurement of the fair values at grant date of the equity-settled share-based payment plan
were as follows:
Grant date
Fair value at grant date
Share price at grant date
Exercise price
Expected volatility
Expected life
Expected dividends
Risk-free interest rate
August
2021
November
2022
March
2021
0.41
2.38
2.38
31%
July
2021
0.95
3.70
3.33
31%
October
2021
1.37
4.19
3.33
31%
July
2021
1.01
3.77
3.33
31%
0.98
3.70
3.33
31%
5.4 years
5.2 years
5.1 years
5.2 years
5.2 years
0.4%
(0.63%)
0.4%
(0.75%)
0.4%
(0.56%)
0.4%
(0.79%)
0.4%
(0.80%)
0.87
3.57
3.48
31%
6 years
0.5%
1.92%
Expected volatility has been based on an evaluation of the historical volatility of the Company's share price, particularly
over the historical period. The expected term of the instruments has been based on general option holder behaviour.
Measurement of fair values (cash-settled)
The fair value of the cash LTIP awards have been measured using a Monte Carlo simulation. Service and non-market
performance conditions attached to the arrangements were not taken into account in measuring fair value.
The inputs used in the measurement of the fair values of the cash LTIP at 31 December 2022 and at grant date
are as follows:
Grant date
Fair value at grant date
Share price at grant date
Exercise price
Expected volatility
Expected life
Expected dividends
Risk-free interest rate
2022
2021
July 2021
June 2021*
July 2021
0.66
3.35
3.33
31%
3.5 years
0.5%
2.69%
1.54
4.59
3.33
31%
3.2 years
0.4%
(0.57%)
0.66
3.35
3.33
31%
3.5 years
0.4%
(0.68%)
* All the share options awarded in this grant were forfeited during the year ended 31 December 2022.
Expected volatility has been based on an evaluation of the historical volatility of the Company's share price, particularly
over the historical period. The expected term of the instruments has been based on general option holder behaviour.
179
180
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
28 Employee share awards continued
29 Reconciliation of operating profit to cash flow from operating activities
Reconciliation of outstanding share options
The number and weighted-average exercise prices of share options under the 2021 and 2022 share option programme
were as follows:
2022
Weighted Average
Exercise Price €
Number
000’s
2021
Weighted Average
Exercise Price €
Number
000’s
GROUP
Operating profit before operating exceptional items
Cash related exceptional items
As at 1 Jan
Granted during the year
Forfeited during the year
Exercised during the year
As at 31 December
3.05
3.48
(2.54)
–
3.47
1,670
12,500
(600)
–
13,570
–
3.05
–
–
–
1,670
–
–
3.05
1,670
The options outstanding at 31 December 2022 had an exercise price in the range of €3.33 to €3.48 (2021: €2.38 to
€3.33) and a weighted-average contractual life of 9.8 years (2021: 7 years).
Expense recognised in profit and loss
An equity-settled share-based payment charge of €535,000 (2021: €183,000) has been recognised in the year.
A cash-settled share-based payment charge of €6,000 (2021: €28,000) has been recognised in the year in respect of the
cash LTIP awards.
Long–term incentive plan
The Company operates a long-term incentive plan for certain Executive Directors and managerial employees under
which shares have been granted subject to vesting conditions linked to the achievement of demanding Group
performance measures and operational targets as well as continued employment with the Group. The Company
can require compulsory transfer of these shares if certain criteria are not met.
As at 31 December 2022, the Company had allotted 13,162,240 ordinary shares of €0.08 each (2021: 13,162,240
shares) to members of the Uniphar Executive Directors and managerial employees under the long term incentive plan.
All shares issued under the long-term incentive plan at 31 December 2022 and 31 December 2021 were called up and
fully paid. These shares remain subject to ‘non-market’ vesting conditions. No charge to the Income Statement arises
in either 2022 or 2021 in respect of this arrangement.
Depreciation
Amortisation
(Increase)/decrease in inventory
Decrease/(increase) in receivables
Increase in payables
Share based payment expense
Foreign currency translation adjustments
Cash inflow from operating activities
COMPANY
Operating profit before operating exceptional items
Cash related exceptional items
Depreciation
Amortisation
(Increase)/decrease in receivables
Increase/(decrease) in payables
Share based payment expense
Foreign currency translation adjustments
Cash outflow from operating activities
2022
€’000
2021
€’000
69,570
(7,768)
61,802
23,356
5,114
(15,130)
2,934
2,700
535
1,393
59,551
(9,072)
50,479
22,225
4,705
3,726
(26,169)
13,205
183
22
82,704
68,376
7,779
(3,093)
4,686
3,269
541
8,842
(1,741)
7,101
3,276
380
(18,203)
95,970
5,869
(124,565)
535
–
183
1,372
(3,303)
(16,283)
181
182
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 30 Reconciliation of net cash flow to movement in net bank debt
31 Analysis of changes in net debt continued
GROUP
Increase in cash and overdrafts in the year
Movement in restricted cash (Note 31)
Cash flow from movement in borrowings (Note 31)
Decrease in net debt resulting from cash flows
Debt acquired during the year (Note 31)
Non-cash movement in borrowings during the year (Note 31)
Foreign currency translation on cash and cash equivalents
Movement in net bank debt in the year
Net bank debt at beginning of year
Net bank debt at end of year
COMPANY
Increase/(decrease) in cash and overdrafts in the year (Note 31)
Movement in restricted cash (Note 31)
Cash flow from movement in borrowings (Note 31)
Decrease in net bank debt resulting from cash flows
Movement in net bank debt in the year
Net bank debt at beginning of year
Net bank debt at end of year
31 Analysis of changes in net debt
2022
€’000
2021
€’000
26,904
–
(59,179)
(32,275)
(23,843)
14,423
(1,225)
(42,920)
(48,297)
15,778
(3,097)
(28,394)
(15,713)
(352)
350
1,837
(13,878)
(34,419)
(91,217)
(48,297)
656
–
(62,830)
(62,174)
(62,174)
(122,496)
(1,129)
(2,100)
(29,265)
(32,494)
(32,494)
(90,002)
(184,670)
(122,496)
1 January
2022
€’000
Cash
flow
€’000
Acquisitions
(Note 35)
€’000
Non-cash
movement
€’000
31 December
2022
€’000
GROUP
Cash and cash equivalents
78,025
23,609
Total Cash
78,025
23,609
3,295
3,295
(1,225)
103,704
(1,225)
103,704
Bank loans repayable within one year*
Bank loans repayable after one year
Bank loans
Net bank debt
Lease obligations
Net debt
(1,721)
(124,601)
(126,322)
3,651
(62,830)
(59,179)
(23,843)
14,423
(7,490)
–
–
(187,431)
(23,843)
14,423
(194,921)
(48,297)
(35,570)
(20,548)
13,198
(91,217)
(119,078)
16,836
(7,220)
(10,772)
(120,234)
(167,375)
(18,734)
(27,768)
2,426
(211,451)
* The Non-cash movement in 2022 principally relates to an invoice discounting facility associated with the BModesto
Group acquisition which was not repaid at the time of acquisition.
GROUP
Cash and cash equivalents
Restricted cash
Total Cash
Bank loans repayable within one year
Bank loans repayable after one year
Bank loans
1 January
2021
€’000
Cash
flow
€’000
60,410
3,097
63,507
(2,311)
(95,615)
(97,926)
10,060
(3,097)
6,963
240
(28,634)
(28,394)
Acquisitions
€’000
5,718
–
5,718
–
(352)
(352)
Non-cash
movement
€’000
31 December
2021
€’000
1,837
–
1,837
350
–
350
78,025
–
78,025
(1,721)
(124,601)
(126,322)
Net bank cash/(debt)
(34,419)
(21,431)
5,366
2,187
(48,297)
Lease obligations
Net debt
(120,537)
16,625
(1,429)
(13,737)
(119,078)
(154,956)
(4,806)
3,937
(11,550)
(167,375)
COMPANY
Cash and cash equivalents
Total Cash
Bank loans repayable after one year
Bank loans
Net bank debt
Lease obligations
Net debt
1 January
2022
€’000
Cash
flow
€’000
Non-cash
movement
€’000
31 December
2022
€’000
2,105
2,105
656
656
(124,601)
(124,601)
(62,830)
(62,830)
(122,496)
(62,174)
–
–
–
–
–
2,761
2,761
(187,431)
(187,431)
(184,670)
(45,034)
4,232
(1,317)
(42,119)
(167,530)
(57,942)
(1,317)
(226,789)
183
184
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 31 Analysis of changes in net debt continued
32 Financial instruments continued
COMPANY
Cash and cash equivalents
Restricted cash
Total Cash
Bank loans repayable after one year
Bank loans
Net bank debt
Lease obligations
Net debt
32 Financial instruments
1 January
2021
€’000
Cash
flow
€’000
Non-cash
movement
€’000
31 December
2021
€’000
3,234
2,100
5,334
(1,129)
(2,100)
(3,229)
(95,336)
(95,336)
(29,265)
(29,265)
(90,002)
(32,494)
–
–
–
–
–
–
2,105
–
2,105
(124,601)
(124,601)
(122,496)
(45,820)
4,237
(3,451)
(45,034)
(135,822)
(28,257)
(3,451)
(167,530)
Financial instruments by category
The accounting policies for financial instruments have been applied to the line items below:
Financial
assets at
FVOCI*
Notes
€’000
Financial
assets at
amortised
cost
€’000
Total
€’000
12
16
16
17
12
16
16
17
25
–
–
–
25
25
–
–
–
25
–
25
146,814
146,814
100
100
103,704
103,704
250,618
250,643
–
25
137,102
137,102
448
78,025
448
78,025
215,575
215,600
Financial assets
2022
Investments in equity instruments
Trade and other receivables**
Deferred consideration receivable
Cash and cash equivalents
2021
Investments in equity instruments
Trade and other receivables**
Deferred consideration receivable
Cash and cash equivalents
* Fair value through other comprehensive income.
** Excluding prepayments and accrued income.
Financial
liabilities at
FVTPL*
Notes
€’000
Financial
liabilities at
amortised
cost
€’000
Total
€’000
Financial liabilities
2022
Borrowings
Deferred acquisition consideration
Trade and other payables**
Deferred contingent consideration
Lease obligations
2021
Borrowings
Deferred acquisition consideration
Trade and other payables**
Deferred contingent consideration
Lease obligations
* Fair value through profit and loss.
** Excluding non-financial liabilities.
18
22
22
19
21
18
22
22
19
21
194,921
194,921
–
–
–
91,798
523
236,238
–
–
120,234
523
236,238
91,798
120,234
91,798
551,916
643,714
–
–
–
88,918
126,322
4,295
195,455
–
–
119,078
126,322
4,295
195,455
88,918
119,078
88,918
445,150
534,068
Fair value
The following table sets out the fair value of the Group’s principal financial assets and liabilities.
Financial assets
Investments in equity instruments
Trade and other receivables
Deferred consideration receivable
Cash and cash equivalents
Financial liabilities
Borrowings
Deferred acquisition consideration
Trade and other payables
Deferred contingent consideration
Lease obligations
2022
Carrying value
€’000
2022
Fair value
€’000
2021
Carrying value
€’000
2021
Fair value
€’000
Notes
12
16
16
17
18
22
22
19
21
25
25
25
25
146,814
146,823
137,102
137,117
100
100
103,704
103,704
448
78,025
448
78,025
250,643
250,652
215,600
215,615
194,921
194,921
523
236,238
91,798
120,234
523
236,238
91,798
120,234
126,322
4,295
195,455
88,918
119,078
133,974
4,369
195,455
88,918
119,078
643,714
643,714
534,068
541,794
185
186
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
32 Financial instruments continued
32 Financial instruments continued
Measurement of fair values
In the preparation of the financial statements, the Group finance department, which reports directly to the
Chief Financial Officer (CFO), reviews and determines the major methods and assumptions used in estimating
the fair values of the financial assets and liabilities which are set out below:
Investments in equity instruments
Investments in equity instruments are measured at fair value through other comprehensive income (FVOCI).
Trade and other receivables/trade and other payables
For receivables and payables with a remaining life of less than 12 months or demand balances, the carrying value
less impairment provision where appropriate, is deemed to reflect fair value.
Cash and cash equivalents, including short-term bank deposits
For short-term bank deposits and cash and cash equivalents, all of which have a remaining maturity of less than
three months, the carrying amount is deemed to reflect fair value.
Interest-bearing loans and borrowings
For floating rate interest-bearing loans and borrowings with a contractual repricing date of less than 6 months,
the nominal amount is deemed to reflect fair value. For loans with repricing dates of greater than 6 months, the fair
value is calculated based on the present value of the expected future principal and interest cash flows discounted
at appropriate market interest rates (level 2) effective at the Balance Sheet date and adjusted for movements in
credit spreads.
Deferred acquisition consideration
Discounted cash flow method was used to capture the present value of the expected future economic benefits that
will flow out of the Group arising from the deferred acquisition consideration.
Deferred contingent consideration
The fair value of the deferred contingent consideration is calculated by discounting the expected future payment to
the present value. The expected future payment represents the deferred contingent acquisition consideration which
would become payable based on pre-defined profit thresholds being met and is calculated based on management’s
best estimates of the expected future cash outflows using current budget forecasts. The provision for deferred
contingent consideration is principally in respect of acquisitions completed from 2015 to 2022. A maturity analysis
of the deferred contingent consideration on an undiscounted basis is presented on page 192.
The significant unobservable inputs are:
» Expected future profit forecasts which have not been disclosed due to their commercial sensitivities; and
» Risk adjusted discount rate of between 2.5% and 4% (2021: between 2% and 3%).
The estimated fair value would increase/(decrease) if the:
» Expected future profit forecasts were higher/(lower); and
» Risk adjusted discount rate was lower/(higher).
For the fair value of deferred contingent consideration, a 1% increase in the risk adjusted discount rate at
31 December 2022, holding the other inputs constant would reduce the fair value of the deferred contingent
consideration by €1.5m. A 1% decrease in the risk adjusted discount rate would result in an increase of €1.5m
in the fair value of the deferred contingent consideration.
Fair value hierarchy
The following table sets out the fair value hierarchy for financial instruments which are measured at fair value.
Level 1
€’000
Level 2
€’000
Level 3
€’000
Total
€’000
Recurring fair value measurements
At 31 December 2022
Investments in equity instruments
Deferred contingent consideration
At 31 December 2021
Investments in equity instruments
Deferred contingent consideration
–
–
–
–
–
–
–
–
–
–
–
–
25
25
(91,798)
(91,798)
(91,773)
(91,773)
25
25
(88,918)
(88,918)
(88,893)
(88,893)
There were no transfers between the fair value levels for recurring fair value measurements during the year. The Group’s
policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
Level 1: The fair value of financial instruments traded in active markets is based on quoted market prices at the end
of the reporting period. The quoted market price used for financial assets held by the Group is the current bid price.
These instruments are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation
techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates.
If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included
in level 3.
187
188
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 32 Financial instruments continued
32 Financial instruments continued
Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items for the years ended 31 December 2022
and 31 December 2021:
At 1 January 2021
Utilised during the year
Recognised during the year*
Unwinding of discount*
Arising on acquisition
Released during the year*
Foreign currency movement
At 31 December 2021
Utilised during the year
Change in discount rate*
Unwinding of discount*
Arising on acquisition
Released during the year*
Foreign currency movement
At 31 December 2022
Shares in
unlisted
companies
€’000
Deferred
contingent
consideration
€’000
Total
€’000
25
(86,195)
(86,170)
–
–
–
–
–
–
13,283
(4,831)
(1,845)
(29,195)
24,592
(4,727)
13,283
(4,831)
(1,845)
(29,195)
24,592
(4,727)
25
(88,918)
(88,893)
–
–
–
–
–
–
5,127
1,405
(2,073)
(17,519)
12,030
(1,850)
5,127
1,405
(2,073)
(17,519)
12,030
(1,850)
25
(91,798)
(91,773)
* These amounts have been credited/(charged) to the Income Statement in finance income/costs.
Financial risk management
The Group’s operations expose it to various financial risks. The Group has a risk management framework in place
which seeks to limit the impact of these risks on the financial performance of the Group and it is the Group’s policy
to manage these risks in a non-speculative manner.
The Group has exposure to the following risks from its use of financial instruments: credit risk, liquidity risk, currency
risk, interest rate risk and price risk. This note presents information about the Group’s exposure to each of the above
risks and the Group’s objectives, policies, and processes for measuring and managing the risk. Further quantitative
disclosures are included throughout this note.
The Group’s risk management is carried out by a central finance department under policies approved by the Board
of Directors. Group finance identifies, evaluates, and manages financial risks in close co-operation with the Group’s
operating units. The Board approves written principles for overall risk management, as well as policies covering
specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments
and non-derivative financial instruments and the investment of excess liquidity.
Credit risk
Credit risk arises from credit to customers, loans to customers, deferred consideration receivable, restricted cash, as
well as cash and cash equivalents including deposits with banks and financial institutions.
The Group manages credit risk through the use of credit limits for customers, regular review of the ageing of trade and
other receivables, and the review and monitoring of customer and bank credit ratings.
Trade receivables
Credit risk arising in the context of the Group’s operations is not significant with the provision for impairment at the
Balance Sheet date amounting to 3.9% of gross trade receivables (2021: 4.5%). The Group accounts for its credit
risk by appropriately providing for expected credit losses on a timely basis. In calculating the expected credit loss
rates, the Company considers historical loss rates for each category of customers and adjusts for forward looking
macroeconomic data.
Customer credit risk is managed at appropriate Group locations according to established policies, procedures and
controls. Customer credit quality is assessed in line with strict credit rating criteria and credit limits are established
where appropriate. Outstanding customer balances are regularly monitored and a review for indicators of impairment
(evidence of financial difficulty of the customer, payment default, breach of contract etc.) is carried out at each reporting
date. Individual receivables which are known to be uncollectible are written off by reducing the carrying amount directly.
The other receivables are assessed collectively to determine whether there is objective evidence that an impairment has
been incurred but not yet identified. For these receivables the estimated impairment losses are recognised in a separate
provision for impairment.
The Group considers that there is evidence of impairment if any of the following indicators are present:
» Significant financial difficulties of the receivable;
» Probability that the receivable will enter bankruptcy or financial reorganisation; and
» Default or delinquency in payments (more than 30 days overdue).
Receivables for which an impairment provision was recognised are written off against the provision when there
is no expectation of recovering additional cash.
Impairment losses are recognised in the Income Statement within selling and distribution costs. Subsequent
recoveries of amounts previously written off are credited against selling and distribution costs where the initial
impairment was recorded.
Movements in the provision for impairment of trade receivables that are assessed for impairment collectively
are as follows:
At 1 January
Provision for impairment recognised during the year
Receivables written off during the year as uncollectible
Recovery of balances previously provided for
Reclassification
Foreign currency translation
At 31 December
2022
€’000
6,050
159
(285)
(109)
–
(29)
5,786
2021
€’000
4,806
1,521
(8)
(28)
(274)
33
6,050
The trade receivables balances disclosed in Note 16 comprise a large number of customers spread across the Group’s
activities and geographies with balances classified as ‘not past due’ representing 82.4% of the total trade receivables
balance at the Balance Sheet date (2021: 89.4%). Invoice discounting arrangements are employed in certain of the
Group’s operations where they are deemed to be of benefit by management.
189
190
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 32 Financial instruments continued
32 Financial instruments continued
Under the terms of the invoice discounting non-recourse agreement, the Group has transferred substantially all credit
risk and control of certain trade receivables. The balance of the facility as at 31 December 2022 is €111,765,000
(2021: €94,118,000). During the year ended 31 December 2022, the Group increased its non-recourse facility by
€15,000,000 (2021: €nil). The Group has recognised an asset within trade and other receivables of €16,765,000
(2021: €14,118,000), being the fair value of the amount receivable from the financial institutions, representing 15% of
the trade receivables transferred to the financial institutions in accordance with the terms of the receivables purchase
arrangement. The total interest expense associated with this receivables purchase agreement during the year ended
31 December 2022 was €1,866,000 (2021: €1,296,000).
On acquisition of BModesto Group in 2022, the Group acquired an invoice discounting facility that is with recourse to
the Group. The balance of this facility at 31 December 2022 is €5,900,000 (2021: €nil).
The ageing of trade receivables at 31 December 2022 and 2021 was:
Not past due
Past due
0 – 30 days
30 – 60 days
60 days
Total past due
Total trade receivables
2022
€’000
2021
€’000
117,068
115,724
16,371
3,987
4,624
24,982
7,701
2,226
3,817
13,744
142,050
129,468
Cash and cash equivalents
Cash and cash equivalents give rise to credit risk on amounts due from counterparty financial institutions
(stemming from their insolvency or a downgrade in their credit ratings). Credit risk is managed by the regular review of
the credit ratings of these financial institutions and limiting the aggregate amount and duration of exposure to any one
counterparty primarily depending on its credit rating. All the Group’s cash and cash equivalents are currently held with
financial institutions which have investment grade credit ratings ranging from A-1 to A-3 (2021: A-1 to A-3).
Other financial assets
The Group has investments in companies with a strategic interest to the Group which are of a non-speculative nature.
The investments and any impairment provisions are outlined in Note 12.
The carrying amount of financial assets, net of impairment provisions represents the Group’s maximum credit exposure.
The maximum exposure to credit risk at year end was as follows:
Liquidity risk
The Group manages liquidity risk through, maintaining sufficient cash and cash equivalents to meet obligations
when due, credit facilities and overdraft facilities, monitoring and managing the maturity of borrowings, regular review
of the ageing of trade and other receivables, and review and monitoring of customer and bank credit ratings.
Management monitors forecasts of the maturity of the Group’s borrowings and other obligations. Management
forecasts cash flows expected to settle the Group’s obligations and actively monitors the level of cash and facilities
available to settle the Group’s obligations as they fall due. Forecasts of cash flows to settle trade and other payables
are generally carried out at a subsidiary level in the operating companies of the Group in accordance with practice
and limits set up by the Group.
The following table outlines the undiscounted contractual maturities of the Group’s financial liabilities at the
Balance Sheet date. The undiscounted cash flows and maturity profile differ from the amount included in the
Balance Sheet because the Balance Sheet amount is based on the discounted cash flows.
Less than 6
months
6 to 12
months
Between 1
and 2 years
Between 2
and 5 years
Over 5
years
€’000
€’000
€’000
€’000
€’000
Total
contractual
cash flows
€’000
Contractual maturity of financial liabilities
At 31 December 2022
Borrowings
Deferred acquisition consideration
Deferred contingent consideration
Lease obligations
Trade and other payables
At 31 December 2021
Borrowings
Deferred acquisition consideration
Deferred contingent consideration
Lease obligations
Trade and other payables
7,565
523
14,467
7,984
236,238
–
–
21,293
7,704
–
–
–
29,418
14,986
–
229,140
–
32,357
36,868
–
–
–
–
74,941
–
236,705
523
97,535
142,483
236,238
266,777
28,997
44,404
298,365
74,941
713,484
1,676
470
5,594
7,981
195,455
52
3,899
25,224
7,606
–
–
–
21,019
13,911
–
132,246
–
41,074
35,118
–
–
–
–
77,915
–
133,974
4,369
92,911
142,531
195,455
211,176
36,781
34,930
208,438
77,915
569,240
Trade and other receivables*
Deferred consideration receivable
Cash and cash equivalents
Total
* Excluding prepayments and accrued income.
2022
€’000
2021
€’000
146,814
137,102
100
103,704
448
78,025
250,618
215,575
Deferred contingent consideration is provided based on management’s assessment of the fair value of the liability
taking into account the expected profitability of the acquisition. The maximum amount of additional Deferred contingent
consideration not provided for in the financial statements is €60,300,000 assuming the acquisitions satisfy all
performance conditions as set out in their acquisition.
Lender covenants
The Group entered into a new banking facility in August 2022 that expanded both the size and number of participating
banks in the syndicate. Under this facility the Group are subject to two covenants: leverage ratio and interest cover.
Banking covenants are subject to bi-annual review, and during 2022 all covenants have been fully complied with.
191
192
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 32 Financial instruments continued
32 Financial instruments continued
Currency risk
The Group primarily operates in the Republic of Ireland and the majority of the Group’s activities are conducted in
Euro. Elements of the Group’s operations are carried out in the UK, Europe, the US and Asia Pacific. As a result,
the Group is exposed to structural currency fluctuations in respect of Sterling, Swedish Krona, the US Dollar and
the Australian Dollar primarily. To the extent that the non-Euro denominated assets and liabilities of the Group do not
offset, the Group is exposed to structural currency risk. Such movements are reported through the Group Statement
of Comprehensive Income.
The Euro is the principal currency of the Group’s Irish and Benelux businesses, Sterling is the principal currency of the
Group’s UK businesses, the Swedish Krona is the principal currency of our Nordic businesses, the US Dollar is the
principal currency of our US businesses, and the Australian Dollar is the principal currency of our Australian businesses.
The Group seeks to manage the foreign currency translation risk arising from an investment in a foreign operation
through the drawdown of borrowings denominated in the relevant currency and designating as a net investment hedge
against the investment in the foreign operation.
The Group actively monitors the level of foreign exchange exposure and ensures that its net exposure is kept at an
acceptable level. Currency risks are regularly monitored and managed by utilising spot and forward foreign currency
contracts as appropriate for settling liabilities arising from the purchase of goods for resale in non-functional currencies.
The majority of transactions entered into by Group entities are denominated in functional currencies and no significant
level of hedging is required.
A portion of the Group’s USD denominated borrowings with a nominal amount of USD 34.5 million (2021: USD 15.0
million) is designated as a hedge of a portion of the net investment in the Group’s USD net assets amounting to
USD 34.5 million (2021: 15.0 million). A portion of the Group’s GBP denominated borrowings with a nominal amount of
GBP 9.1 million (2021: GBP 9.1 million) is designated as a hedge of a portion of the net investment in the Group’s GBP
net assets amounting to GBP 9.1 million. A portion of the Group’s AUD denominated borrowings with a nominal amount
of AUD 4.2 million (2021: AUD nil) is designated as a hedge of a portion of the net investment in the Group’s AUD net
assets amounting to AUD 4.2 million (2021: nil) The hedge ratio was 1:1 and there was no ineffectiveness recognised in
the Group Income Statement during the year (2021: nil).
Carrying value of net investment hedge
Gain/(Loss) recognised in other comprehensive income
2022
€’000
45,239
2,070
2021
€’000
24,031
(692)
Currency risk sensitivity analysis
The following table demonstrates the sensitivity of profit after tax and total equity to movements in the GBP/USD/SEK/
AUD exchange rate with all other variables held constant:
+/– 5% change in GBP/USD/SEK/AUD Exchange rates
Impact on profit after tax*
Impact on total equity**
2022
€’000
834
1,006
2021
€’000
541
1,562
* The impact on profit after tax is based on changing the GBP/USD/SEK/AUD exchange rate used in calculating profit
after tax for the year.
** The impact on total equity is calculated by changing the GBP/USD/SEK/AUD exchange rate used in measuring the
closing balance sheet plus the impact to profit after tax for the period.
Interest rate risk
The Group has no fixed rate borrowings and its receivables are carried at amortised cost. At 31 December 2022,
the Group revolving credit facility (RCF) is subject to an interest rate charge based on inter-bank interest rates
(EURIBOR, GBP SONIA and USD SOFR) +1.5%. Interest charged on the RCF is subject to change based on the
Group’s leverage ratio.
Invoice discounting and non-recourse facility are subject to interest rate charges based on Prime/EURIBOR +1.75%.
Variable rate borrowings (Note 18)
2022
€’000
2021
€’000
194,921
126,322
A decrease of fifty basis points in the interest rate would have reduced interest payable on borrowings in finance costs
by €955,000 (2021: €636,000) and consequently increased our profit before tax and equity. An increase of fifty basis
points would have increased interest payable on borrowings in finance costs and consequently reduced our profit
before tax and equity by an equal and opposite amount. A similar movement with regard the non-recourse facility would
result in a reduction/increase of €475,000 in interest payable.
Price risk
The Group’s exposure to equity price risk arises from investments held by the Group and classified in the Balance Sheet
as investments in equity instruments. The investments in equity instruments are measured at fair value through OCI.
The Group is exposed to the risk of an illiquid market for unlisted companies as these investments are not traded on
an active market.
Capital management
The Group’s objectives when managing capital are to:
» Safeguard their ability to continue as a going concern and to continue to provide a return for shareholders; and
» Maintain an optimal capital structure and reduce the overall cost of capital.
In managing its capital structure, the Group’s capital consists of total equity and net bank debt. The Board monitors
the return on capital employed and dividend policy in order to optimise shareholder value while allowing the Group to
take advantage of opportunities that might arise to grow the business and to sustain the ongoing development of the
Group. At the year end, the Group was in a net bank debt position of €91,217,000 (2021: net bank debt of €48,297,000).
Total equity of the Group at 31 December 2022 was €289,783,000 (2021: €251,564,000). The Directors periodically
review the capital structure of the Group, considering the cost of capital and the associated risks.
33 Future capital expenditure not provided for
At 31 December 2022, the Group had capital commitments of €45,898,000 (2021: €2,860,000).
Contracted for
Intangible assets
Property, plant and equipment
2022
€’000
695
45,203
45,898
2021
€’000
1,453
1,407
2,860
The majority of the Property, plant and equipment amount that is contracted for relates to the strategic investment
in a new Supply Chain & Retail distribution facility in Dublin.
193
194
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 34 Contingent liabilities
35 Acquisitions of subsidiary undertakings and business assets continued
Subsidiaries
Pursuant to the provisions of Section 357, Companies Act 2014, the Company has put in force in respect of the whole
of the financial year ended 31 December 2022 an irrevocable guarantee of all commitments entered into by a subsidiary
including amounts shown as liabilities in the statutory financial statements of the relevant subsidiary. The list of relevant
subsidiaries is as follows: Uniphar Wholesale Limited, Allphar Services Limited, Unisource Pharma Services Ireland
Limited, Allcare Management Services Limited, Uniphar Durbin Ireland Limited, Point of Care Health Services Limited,
Lindchem Designated Activity Company, Trennamally Limited, Cahill May Roberts Limited, Life Pharmacy Limited,
Uniphar Europe Limited, M3 Medical Limited, Pagni Pharmacies Limited, Sisk Healthcare Limited, Pyramach Limited
and Innerstrength Limited.
Guarantees
The Company and certain subsidiaries have issued guarantees totalling €92,000 (2021: €317,000) in respect of
bank borrowings undertaken by past customers of Cahill May Roberts Limited. The outstanding bank borrowing at
the Balance Sheet date, for which these guarantees have been provided, gives rise to a contingent liability €92,000
(2021: €160,000) for the Group.
From a Company perspective, the contingent liability at year end is €nil (2021: €nil).
The change in the level of contingent liabilities is due to reduced underlying loan balances.
Legal
From time to time, in the normal course of business, the Group can be subject to claims from various parties. Having
considered the status of such matters as at 31 December 2022, the Directors are satisfied that there are no such
matters which require either a provision or contingent liability disclosure in the financial statements.
35 Acquisitions of subsidiary undertakings and business assets
A key strategy of the Group is to expand into higher growth sectors and extend the capabilities the Group can offer
our clients. In line with this strategy, the Group completed the following acquisitions during the financial year:
Chansey Holdings Limited and Edenmore Pharmacy Limited
The Group acquired 100% of the ordinary share capital of Chansey Holdings Limited and Edenmore Pharmacy
Limited in January 2022 for consideration of €4,356,000. Chansey Holdings Limited and Edenmore Pharmacy
Limited currently operates three independent retail pharmacies in Ireland.
Boxted Limited
The Group acquired 100% of the ordinary share capital of Boxted Limited in February 2022 for consideration
of €1,716,000. Boxted Limited currently operates an independent retail pharmacy in Ireland.
Dr Hauschka Limited
The Group acquired 100% of the ordinary share capital of Dr Hauschka Limited in March 2022 for consideration
of €1,541,000. Dr Hauschka Limited is a distributor of skincare products to pharmacies and health stores in Ireland.
Lanesra Pharmacy Limited
The Group acquired 100% of the ordinary share capital of Lanesra Pharmacy Limited in May 2022 for
consideration of €4,339,000. Lanesra Pharmacy Limited currently operates an independent retail pharmacy
in Ireland.
Mainarch Limited
The Group acquired 100% of the ordinary share capital of Mainarch Limited in June 2022 for consideration
of €1,980,000. Mainarch Limited currently operates an independent retail pharmacy in Ireland.
Orspec Pharma Group
The Group acquired 100% of the ordinary share capital of Orspec Pharma Pty Limited in August 2022 for
consideration of €6,664,000 of which €454,000 is deferred and €3,836,000 is deferred and contingent on agreed
targets being met. Orspec Pharma, an Australia headquartered company, supplies pharmaceutical products
across the Asia Pacific region with locations in Australia, New Zealand and Singapore.
Inspired Health
The Group acquired 100% of the membership interests of Inspired Insight, LLC, in September 2022 for a
consideration of €25,504,000 of which €7,087,000 is deferred and contingent on agreed targets being met.
Inspired Health, a United States based company, is an innovation, sales and marketing consultancy business
inspired by insight and data.
BModesto Group
The Group acquired 85% of the ordinary share capital of BModesto Vastgoed B.V. in November 2022 and, on the
same date, entered into a put and call option which would enable the Group to acquire the remaining 15% stake
in exchange for cash consideration. This has been accounted under the anticipated acquisition method with the
combined 100% recognised as acquired from November 2022. Acquisition consideration recognised amounted
to €41,901,000 of which €6,596,000 is payable based on agreed targets being met in respect of the put and call
option on the remaining 15% shareholding. BModesto Group, a Netherlands headquartered company, provides a
range of services to healthcare companies, pharmacies and hospitals including pharmaceutical product supply,
clinical trial services and medical device distribution.
Young’s Pharmacy
The Group acquired the trade and assets of Young’s Pharmacy in December 2022 for consideration of €1,363,000.
Young’s Pharmacy operates as an independent retail pharmacy in Ireland.
Goodwill is attributable to the future economic benefits arising from assets which are not capable of being individually
identified and separately recognised. The significant factors giving rise to the goodwill include the value of the teams
within the businesses acquired, the enhancement of the competitive position of the Group in the marketplace and the
strategic premium paid by Uniphar Group to create the combined Group.
The fair value of the deferred and contingent consideration recognised at the date of acquisition is calculated by
discounting the expected future payment to present value at the acquisition date. In general, for deferred contingent
consideration to become payable, pre-defined profit thresholds must be exceeded. On an undiscounted basis,
the future payments for which the Group may be liable in respect of acquisitions completed in the current year range
from €0.4m to €48.9m.
The initial assignment of fair values to net assets acquired has been performed on a provisional basis in respect of the
acquisitions completed during 2022, due to their recent acquisition dates. The Group has 12 months from the date of
acquisition to finalise the fair value of the assets/liabilities acquired, and any amendments to these fair values within the
twelve-month period from the date of acquisition will be disclosable in the 2023 Annual Report as stipulated by IFRS 3,
Business Combinations.
The acquisitions completed in 2022 have contributed €61.4m to revenue and €11.2m of gross profit for the year since
the date of acquisition. The proforma revenue and operating profit for the Group for the year ended 31 December 2022
would have been €2,360m and €63m respectively had the acquisitions been completed at the start of the current
reporting year.
195
196
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
35 Acquisitions of subsidiary undertakings and business assets continued
35 Acquisitions of subsidiary undertakings and business assets continued
The provisional fair value of the assets and liabilities acquired as part of the acquisitions completed during the financial
year are set out below:
BModesto
€’000
Others
€’000
Total
€’000
ASSETS
Non-current assets
Intangible assets
Property, plant and equipment
Property, plant and equipment – Right of use assets
Deferred tax asset
Current assets
Inventory
Trade and other receivables
Cash and cash equivalents
Total assets
LIABILITIES
Non-current liabilities
Lease liabilities
Current liabilities
Lease liabilities
Trade and other payables
Bank loans
364
4,089
1,118
207
5,778
28,821
27,853
–
56,674
–
366
6,102
6,550
364
4,455
7,220
6,757
13,018
18,796
1,298
3,337
3,295
7,930
30,119
31,190
3,295
64,604
62,452
20,948
83,400
874
874
243
19,264
23,570
43,077
5,447
5,447
656
4,220
273
5,149
6,321
6,321
899
23,484
23,843
48,226
Total liabilities
43,951
10,596
54,547
Identifiable net assets acquired
18,501
10,352
28,853
Non-controlling interest arising on acquisition
–
–
–
Group share of net assets acquired
18,501
10,352
28,853
Goodwill arising on acquisition
Consideration
23,400
37,447
60,847
41,901
47,799
89,700
197
The acquisitions in the 2022 financial year of BModesto Group has been determined to be a substantial transaction
and separate disclosure of the fair values of the identifiable assets and liabilities has therefore been made. None of
the remaining business combinations completed during the period were considered sufficiently material to warrant
separate disclosure of the fair values attributable to those combinations.
The gross contractual value of the trade and other receivables as at the respective dates of acquisition amounted
to €31.8m. The fair value of these receivables is €31.2m, all of which is expected to be recoverable, and is inclusive
of an aggregate impairment provision of €0.6m. In 2022, the Group incurred acquisition costs of €6.6m (2021: €3.3m).
These have been included in administrative expenses in the Group Income Statement.
2021 Acquisitions
The initial assessment of the fair values of the major classes of assets acquired and liabilities assumed in respect of
the acquisitions which were completed in 2021 was performed on a provisional basis. The fair values attributable to the
assets and liabilities of these acquisitions have now been finalised. The amendments to these fair values were made
to the comparative figures during the subsequent reporting window within the measurement period imposed by IFRS 3.
The provisional fair value of these assets and liabilities recorded at 31 December 2021, together with the adjustments
made to those carrying values to arrive at the final fair values were as follows:
CoRRect
BESTMSLs
€’000
€’000
Others Provisional fair
value of 2021
acquisitions
€’000
€’000
Measurement
period
adjustment
€’000
ASSETS
Non-current assets
Intangible assets
Property, plant and equipment
Current assets
Inventory
Trade and other receivables
Cash and cash equivalents
–
133
133
315
510
60
885
Total assets
1,018
–
222
222
–
2,018
1,347
3,365
3,587
25
1,215
1,240
157
2,415
4,311
6,883
8,123
25
1,570
1,595
472
4,943
5,718
11,133
12,728
2,088
8
2,096
95
1,512
–
1,607
3,703
Total
€’000
2,113
1,578
3,691
567
6,455
5,718
12,740
16,431
198
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 35 Acquisitions of subsidiary undertakings and business assets continued
36 Related party transactions
CoRRect
BESTMSLs
Others
€’000
€’000
€’000
Provisional
fair value
of 2021
acquisitions
€’000
Measurement
period
adjustment
Total
€’000
€’000
69
–
–
69
60
–
604
664
733
149
–
–
149
73
–
1,606
1,679
1,828
963
352
162
1,477
115
–
1,299
1,414
2,891
1,181
352
162
1,695
248
–
3,509
3,757
5,452
–
–
–
–
–
663
66
729
729
1,181
352
162
1,695
248
663
3,575
4,486
6,181
LIABILITIES
Non-current liabilities
Lease liabilities
Bank borrowings
Other non-current liabilities
Current liabilities
Lease liabilities
Deferred tax
Trade and other payables
Total liabilities
Identifiable net assets acquired
285
1,759
5,232
7,276
2,974
10,250
Goodwill arising on acquisition
19,486
21,207
14,603
55,296
(1,437)
53,859
Consideration
19,771
22,966
19,835
62,572
1,537
64,109
In the ordinary course of business as pharmacists, certain Non-Executive Directors of Uniphar plc have traded on
standard commercial terms with the Group. The individual and combined value of these transactions are not material
in the context of the Group’s financial results.
lAS 24 Related Party Disclosures requires the disclosure of compensation paid to the Group’s key management
personnel. Key management personnel are those persons having authority and responsibility for planning, directing,
and controlling the activities of the Group. The Group classifies members of its executive team as key management
personnel. The executive team is the body of senior executives that formulates business strategy with the Directors,
follows through on implementation of that strategy and directs and controls the activities of the Group on a
day-to-day basis.
The executive team consists of two Executive Directors (2021: two), six Non-Executive Directors (2021: six), and an
additional thirteen (2021: nine) individual members at 31 December 2022.
Remuneration of key management personnel
Short term employee benefits (including share-based payment charges
and termination payments)
Post-employment benefits
2022
€’000
2021
€’000
10,426
581
11,007
9,411
198
9,609
199
200
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 37 Group companies
Holding company
Uniphar plc
Principal activity
Investment holding company
The following are the significant subsidiary undertakings of Uniphar plc at 31 December 2022:
Incorporated
and trading in
Subsidiary name
Ownership
%**
Principal activity
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
Ireland
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
Finland
Sweden
Sweden
Sweden
Allcare Management Services Limited*
Allphar Services Limited*
Cahill May Roberts Limited*
Lindchem Designated Activity Company*
M3 Medical Limited*
Pagni Pharmacies Limited*
Point of Care Health Services Limited*
Pyramach Limited*
Sisk Healthcare Limited*
Trennamally Limited*
Uniphar Durbin Ireland Limited*
Uniphar Europe Limited*
Uniphar Wholesale Limited*
Unisource Pharma Services Ireland Limited*
Innerstrength Limited*
Relay for Hope CLG
Uniphar Commercial Solutions Limited
Dr Hauschka Limited
Clinical Cube Limited
Clinical Pyramid Limited
Dialachemist Limited
Durbin plc
Macromed (UK) Limited
Outcome Medical Solutions Limited
Outico Limited
Sisk Healthcare (UK) Limited
Star Outico Limited
Star Medical Limited
Unisource Limited
Events 4 Healthcare Limited
Devonshire Healthcare Services Limited
BModesto UK Limited
Doncaster Pharma Limited
EPS Vascular OY
EP Endovascular AB
EPS Vascular AB
Star Outico Nordics A.B.
The Netherlands
Angiocare B.V.
The Netherlands
Star Medical B.V.
The Netherlands
BModesto Vastgoed B.V.
201
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Pharmacy support services
Pharmaceutical supply chain
and services
Non-trading property holding company
Pharmacy holding company
Medical device distribution
Pharmacy holding company
Specialist nursing and infusion services
Pharmacy holding company
Medical device distribution
Pharmacy holding company
Specialist provider of pharmaceuticals
Investment holding company
Pharmaceutical wholesale distributor
Outsourcing and resourcing
82.3
Healthcare technology
100
100
100
100
100
80
100
Charity
Medical affairs services
Distributor of brand products
Data solutions for pharma industry
Investment holding company
Online pharmacy and product fostering
Specialist provider of pharmaceuticals
94.95
Medical device distribution
100
100
100
100
100
100
100
100
85
85
100
100
100
100
100
100
85
Investment holding company
Data intelligence and consultancy
Medical device distribution
Outsourcing and resourcing
Outsourcing and resourcing
Investment holding company
Pharmaceutical marketing
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
Medical device distribution
Medical device distribution
Medical device distribution
Outsourcing and resourcing
Medical device distribution
Outsourcing and resourcing
Holding company
37 Group companies continued
Incorporated
and trading in
Subsidiary name
The Netherlands BMclinical B.V.
The Netherlands BModesto B.V.
The Netherlands SynCo Pharma B.V.
The Netherlands BMmedical B.V.
Germany
CoRRect Medical GmbH
US
US
US
US
US
US
US
US
US
US
US
US
Australia
Australia
Uniphar USA, Inc.
Uniphar PA USA, LLC
Uniphar C&C USA, LLC
Durbin Inc.
Pharmaceutical Trade Services Inc.
Diligent Health Solutions, LLC
RRD International, LLC
MDea, Inc
The Doctor’s Channel, LLC
BESTMSLS, Inc
Uniphar Logistics USA, LLC
Inspired Insight, LLC
Uniphar Australia Pty Limited
Orspec Pharma Pty Limited
Singapore
Orspec Pharma PTE Limited
New Zealand
Orspec Pharma Management Limited
Ownership
%**
Principal activity
85
85
85
85
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
Medical device distribution
Medical device distribution
Investment holding company
Investment holding company
Investment holding company
Investment holding company
Specialist provider of pharmaceuticals
Telecommunications support
Pharmaceutical advisory
Medical affairs services
Medical affairs services
Medical affairs services
Medical device distribution
Pharmaceutical advisory
Investment holding company
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
Specialist provider of pharmaceuticals
* As disclosed in Note 34, each of the above Irish registered wholly-owned subsidiaries of the Company may avail of
the exemption from filing its statutory financial statements for the year ended 31 December 2022 as permitted by
Section 357 of the Companies Act 2014 and there is in force an irrevocable guarantee from the Company in respect
of all commitments entered into by such wholly-owned subsidiary, including amounts shown as liabilities (within the
meaning of Section 357 (1) (b) of the Companies Act 2014) in such wholly-owned subsidiary’s statutory financial
statements for the year ended 31 December 2022.
** With the exception of the USA subsidiaries, where the holding is in the form of membership interests, all holdings
are in the form of ordinary shares.
The above table includes four pharmacy holding companies, Lindchem Designated Activity Company,
Pagni Pharmacies Limited, Pyramach Limited and Trennamally Limited. Trading pharmacy entities are individually
not deemed significant for the purposes of this disclosure.
Pursuant to Sections 314-316 of the Companies Act, 2014, a full list of subsidiaries, joint ventures and associated
undertakings will be annexed to the Company’s Annual Return to be filed in the Companies Registration Office in Ireland.
202
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued
37 Group companies continued
37 Group companies continued
Incorporated in Republic of Ireland
Registered office
Incorporated in the US
Registered office
Durbin Inc.
Pharmaceutical Trade Services Inc.
RRD International, LLC
Diligent Health Solutions, LLC
MDea, Inc
The Doctor’s Channel, LLC
BESTMSLS, Inc
Inspired Insights LLC
All other USA incorporated companies
William. C. Penick IV
190 East Capitol, Suite 100
Jackson
Mississippi 39201
United States
5820 Gulf Tech Drive
Ocean Springs
Mississippi 39564
United States
7361 Calhoun Place,
Suite 510,
Rockville, MD 20855,
United States
4800 East Street Road,
Suite 100,
Feasterville-Trevose, PA 19053,
United States
8985 S. Eastern Ave, Suite 200
Las Vegas,
NV 89123
United States
101 Tremont Street
8th Floor
Boston
Massachusetts 02108
United States
1209 Orange Street,
Wilmington,
New Castle County,
Delaware 19801,
United States
All Irish incorporated companies
4045 Kingswood Road,
Citywest Business Park,
Co. Dublin,
Ireland,
D24 V06K
Incorporated in UK
Registered office
Star Medical Limited
Star Outico Limited
Outico Limited
Sisk Healthcare (UK) Limited
Events 4 Healthcare Limited
BModesto UK Limited
Doncaster Pharma Limited
All other UK incorporated companies
11 Davy Court
Castle Mound Way
Central Park
Rugby
CV23 0UZ
United Kingdom
6 Wildflower Way
Boucher Road
Belfast
BT12 6TA
Northern Ireland
3 Waterloo Farm Courtyard
Stotfold Road
Arlesey
Bedfordshire
S515 6XP
United Kingdom
c/o Pinsent Masons LLP
30 Crown Place London
EC2 A4ES
United Kingdom
6th Floor
One London Wall
London EC2Y 5EB
United Kingdom
Incorporated in The Netherlands
Registered office
Angiocare B.V.
Star Medical B.V.
All other Netherlands incorporated companies
Eemweg 00031 21
3755LC
Eemnes
The Netherlands
De Tweeling 00020
5215MC
S-Hertogenbosch
The Netherlands
Minervaweg 2
8239 DL
Lelystad
The Netherlands
203
204
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued 37 Group companies continued
37 Group companies continued
Incorporated in Sweden
Registered office
The following were changes to the Group’s structure during 2022:
Star Outico Nordics AB
All other Swedish incorporated companies
Regeringsgatan 29
111 53 Stockholm
Sweden
Hamnplanen 24
263 61 Viken
Skåne län
Sweden
Incorporated in Finland
Registered office
EPS Vascular OY
Hauralantie 43
37800 LEMPÄÄLÄ
Finland
Incorporated in Germany
Registered office
CoRRect Medical GmbH
Incorporated in Australia
Uniphar Australia Pty Limited
Orspec Pharma Pty Limited
Incorporated in Singapore
Orspec Pharma PTE Limited
Incorporated in New Zealand
Orspec Pharma Management Limited
Bahnhofstrasse 32
82041 Oberhaching
Germany
c/o Baker & McKenzie
Tower One
International Towers Sydney
Level 46
100 Barangaroo Avenue
Sydney, NSW 2000
Australia
37 Kallang Pudding Road
03-01, Tong Lee Building Block B
Singapore, 349315
c/o Quigg Partners
Level 7
36 Brandon Street
Wellington 6011
New Zealand
» As set out in Note 35, in January 2022, the Group acquired 100% of the ordinary share capital of Chansey Holdings
Limited and Edenmore Pharmacy Limited, both of which are incorporated in Ireland
» As set out in Note 35, in February 2022, the Group acquired 100% of the ordinary share capital of Boxted Limited,
a company incorporated in Ireland
» As set out in Note 35, in March 2022, the Group acquired 100% of the ordinary share capital of Dr Hauschka Limited,
a company incorporated in Ireland
» As set out in Note 35, in May 2022, the Group acquired 100% of the ordinary share capital of Lanesra Pharmacy
Limited, a company incorporated in Ireland
» As set out in Note 35, in June 2022, the Group acquired 100% of the ordinary share capital of Mainarch Limited,
a company incorporated in Ireland
» As set out in Note 35, in August 2022, the Group acquired 100% of the ordinary share capital of Orspec Pharma
Pty Limited, Orspec Pharma PTE Limited, Orspec Pharma Management Limited (together Orspec Pharma Group)
a group based and incorporated in the Asia Pacific region
» As set out in Note 35, in September 2022, the Group acquired 100% of the membership interests of Inspired Insight,
LLC, a company incorporated in the US
» As set out in Note 35, in November 2022, the Group acquired 85% of the ordinary share capital of BModesto
Vastgoed B.V., a group based in the Netherlands and incorporated in the Netherlands and UK
During 2022, the Group incorporated the following companies:
» Uniphar Commercial Solutions Limited
» Uniphar Logistics USA, LLC
» Uniphar Australia Pty Limited
38 Post balance sheet events
On 31 January 2023, the Group acquired 100% of the issued share capital of LXV Remedies Holdings Limited
which trades as the McCauley’s Pharmacy Group. This acquisition was announced in September 2022 but was
subject to clearance by the Competition and Consumer Protection Commission (CCPC) at 31 December 2022.
McCauley Pharmacy Group is a leading provider of pharmacy and retail services in Ireland and comprises 37 retail
pharmacies at the time of acquisition. Due to the short time frame between the completion date of the acquisition of
McCauley’s Pharmacy Group, and the date of issuance of this report, it was not possible to reliably estimate the fair
value of assets and liabilities or the goodwill amount associated with the completed acquisition. This acquisition will
be accounted for as an acquisition in the 2023 financial statements.
There have been no other material events subsequent to 31 December 2022 that would require adjustment to or
disclosure in this report.
39 Comparative amounts
The comparative amounts have been updated for amendments to the fair value of assets and liabilities acquired during
2021 which are set out in Note 35, these amendments were within the measurement period imposed by IFRS 3.
40 Approval of financial statements
The Directors approved the financial statements on 27 February 2023.
205
206
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS continuedNOTES TO THE FINANCIAL STATEMENTS continued ALTERNATIVE PERFORMANCE MEASURES
ALTERNATIVE PERFORMANCE MEASURES continued
The Group reports certain financial measurements that are not required under IFRS. These key alternative performance
measures (APMs) represent additional measures in assessing performance and for reporting both internally, and to
shareholders and other external users. The Group believes that the presentation of these APMs provides useful
supplemental information which, when viewed in conjunction with IFRS financial information, provides stakeholders
with a more meaningful understanding of the underlying financial and operating performance of the Group and its
divisions. These measurements are also used internally to evaluate the historical and planned future performance
of the Group’s operations.
None of these APMs should be considered as an alternative to financial measurements derived in accordance with
IFRS. The APMs can have limitations as analytical tools and should not be considered in isolation or as a substitute
for an analysis of results as reported under IFRS.
The principal APMs used by the Group, together with reconciliations where the APMs are not readily identifiable from
the financial statements, are as follows:
Definition
Why we measure it
EBITDA
&
Earnings before exceptional items, net finance
expense, income tax expense, depreciation and
intangible assets amortisation.
Adjusted EBITDA
Net bank debt
Earnings before exceptional items, net finance
expense, income tax expense, depreciation and
intangible assets amortisation, adjusted for the
impact of IFRS 16 and the pro-forma EBITDA
of acquisitions.
Net bank debt represents the net total of current
and non-current borrowings, cash and cash
equivalents, and restricted cash as presented
in the Group Balance Sheet.
Net debt
Net debt represents the total of net bank debt,
plus current and non-current lease obligations
as presented in the Group Balance Sheet.
Leverage
Net bank debt divided by adjusted EBITDA for
the period.
Adjusted
Operating Profit
This comprises of operating profit as reported in
the Group Income Statement before amortisation
of acquired intangible assets and exceptional
items (if any).
EBITDA provides management with an
assessment of the underlying trading
performance of the Group and excludes
transactions that are not reflective of the ongoing
operations of the business, allowing comparison
of the trading performance of the business
across periods and/or with other businesses.
Adjusted EBITDA is used for leverage
calculations.
Net bank debt is used by management as
an input into the Group’s current leverage
calculation which management will consider
when evaluating investment opportunities,
potential acquisitions, and internal
resource allocation.
Net debt is used by management as it gives a
complete picture of the Group’s debt including
the impact of lease liabilities recognised under
IFRS 16.
Leverage is used by management to evaluate
the group’s ability to cover its debts. This allows
management to assess the ability of the
Company to use debt as a mechanism to
facilitate growth.
Adjusted operating profit is used to assess the
underlying operating performance excluding the
impact of non-operational items. This is a key
measure used by management to evaluate the
businesses operating performance.
Adjusted
earnings per
share
&
Like for like
adjusted
earnings
per share
Free cash flow
conversion
Return on capital
employed
Definition
Why we measure it
This comprises profit for the financial period
attributable to owners of the parent as reported
in the Group Income Statement before
exceptional items (if any) and amortisation of
acquisition related intangibles (and related
tax thereon), divided by the weighted average
number of shares in issue in the period.
Adjusted EPS is used to assess the after-tax
underlying performance of the business in
combination with the impact of capital structure
actions on the share base. This is a key measure
used by management to evaluate the businesses
operating performance, generate future operating
plans, and make strategic decisions.
Like for like adjusted earnings per share is
calculated for both the current and prior
period by dividing the profit of the relevant
period attributable to owners of the parent as
reported in the Group Income Statement before
exceptional items (if any) and amortisation of
acquisition related intangibles, by the weighted
average number of shares in issue in the
current period.
Free cash flow conversion is calculated as
EBITDA, less investment in working capital,
less maintenance capital expenditure and
foreign currency translation adjustments,
divided by EBITDA.
ROCE is calculated as the 12 months rolling
operating profit before the impact of exceptional
costs and amortisation of acquisition related
intangibles, expressed as a percentage of the
adjusted average capital employed for the same
period. The average capital employed is adjusted
to ensure the capital employed of acquisitions
completed during the period is appropriately
time apportioned.
Like for like adjusted EPS is used to assess the
after-tax underlying performance of the business
assuming a constant share base.
Free cash flow represents the funds generated
from the Group’s ongoing operations.
These funds are available for reinvestment,
and for future acquisitions as part of the Group’s
growth strategy. A high level of free cash flow
conversion is key to maintaining a strong,
liquid Balance Sheet.
This measure allows management to monitor
business performance, review potential
investment opportunities and the allocation
of internal resources.
207
208
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS
ALTERNATIVE PERFORMANCE MEASURES continued
ALTERNATIVE PERFORMANCE MEASURES continued
EBITDA
Adjusted earnings per share
Operating profit
Income Statement
Note 4
Note 11
Note 10
Exceptional charge recognised in operating profit
Depreciation
Amortisation
EBITDA
Adjust for the impact of IFRS 16
Pro-forma EBITDA of acquisitions
Adjusted EBITDA
Net bank debt
Cash and cash equivalents
Bank loans repayable within one year
Bank loans payable after one year
Balance Sheet
Balance Sheet
Balance Sheet
Net bank debt
Net debt
Net bank debt
Current lease obligations
Non-current lease obligations
Alternative Performance Measures
Balance Sheet
Balance Sheet
Net debt
Leverage
Net bank debt
Adjusted EBITDA
Leverage (times)
Adjusted operating profit
Operating profit
Income Statement
Amortisation of acquisition related intangibles
Exceptional charge recognised in operating profit
Note 4
Adjusted operating profit
209
2022
€’000
53,155
16,415
23,356
5,114
2021
€’000
45,147
14,404
22,225
4,705
98,040
86,481
(16,837)
10,167
(16,625)
1,847
91,370
71,703
2022
€’000
103,704
(7,490)
2021
€’000
78,025
(1,721)
(187,431)
(124,601)
(91,217)
(48,297)
2022
€’000
2021
€’000
(91,217)
(14,315)
(48,297)
(14,358)
(105,919)
(104,720)
(211,451)
(167,375)
2022
€’000
2021
€’000
1.0
0.7
2022
€’000
53,155
2,708
16,415
2021
€’000
45,147
2,063
14,404
72,278
61,614
Alternative Performance Measures
Alternative Performance Measures
(91,217)
91,370
(48,297)
71,703
Adjusted earnings per share has been calculated by reference to the following:
Profit for the financial year attributable to owners
Exceptional charge recognised in operating profit (Note 4)
Exceptional credit recognised in finance costs (Note 4)
Exceptional credit recognised in income tax (Note 4)
Amortisation of acquisition related intangibles
Tax credit on acquisition related intangibles
Profit after tax excluding exceptional items
Weighted average number of shares in issue in the year (000’s)
Adjusted basic and diluted earnings per ordinary share (in cent)
Like for like weighted average number of shares (000’s)
Like for like adjusted earnings per ordinary share (in cent)
Free cash flow conversion
2022
€’000
2021
€’000
45,587
48,077
16,415
14,404
(13,191)
(19,761)
(1,106)
2,708
(329)
(777)
2,063
(207)
50,084
43,799
272,557
269,752
18.4
16.2
272,557
272,557
18.4
16.1
2022
€’000
2021
€’000
Alternative Performance Measures
98,040
86,481
EBITDA
(Increase)/decrease in inventory
Decrease/(increase) in receivables
Increase in payables
Share based payment expense
Foreign currency translation adjustments
Note 29
Note 29
Note 29
Note 29
Note 29
Payments to acquire property, plant and equipment – Maintenance
Cash Flow Statement
Payments to acquire intangible assets – Maintenance
Cash Flow Statement
Free cash flow
Adjustment for settlement of acquired financial liabilities*
EBITDA
Free cash flow conversion
(15,130)
3,726
2,934
2,700
535
1,393
(8,299)
(3,448)
(26,169)
13,205
183
22
(8,795)
(3,904)
78,725
64,749
2,138
1,513
80,863
66,262
98,040
86,481
82.5%
76.6%
* The adjustment to free cash flow ensures that payments made after an acquisition to settle loans with former
shareholders of acquired companies, or other similar financial liabilities, are excluded from the movement in payables
in the free cash flow conversion calculation.
210
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS ALTERNATIVE PERFORMANCE MEASURES continued
GLOSSARY OF TERMS
Return on capital employed
Rolling 12 months operating profit
Adjustment for exceptional costs
Amortisation of acquisition related intangibles
Adjusted 12 months rolling operating profit
Total equity
Net bank debt
Deferred contingent consideration (Note 19)
Deferred consideration payable (Note 22)
Total capital employed
Average capital employed
Adjustment for acquisitions (Note A/B below)
Adjusted average capital employed
Return on capital employed
Note A: Adjustment for acquisitions (2022)
BModesto Group
Other acquisitions completed during 2022
Adjustment for acquisitions during 2022
Note B: Adjustment for acquisitions (2021)
2020
€’000
2022
€’000
53,155
16,415
2,708
2021
€’000
45,147
14,404
2,063
72,278
61,614
289,783
251,564
202,535
91,217
91,798
523
48,297
88,918
4,295
34,419
86,195
4,461
473,321
393,074
327,610
433,198
(15,552)
360,342
(9,384)
417,646
350,958
17.3%
17.6%
Capital
employed
€’000
Completion
date
Adjustment
€’000
41,901
47,464
November
2022
Various
(13,967)
(1,585)
(15,552)
BESTMSLs Group
Other acquisitions completed during 2021
Adjustment for acquisitions during 2021
22,966
18,967
July 2021
Various
Capital
employed
€’000
Completion
date
Adjustment
€’000
(1,914)
(7,470)
(9,384)
The adjustment ensures that the capital employed of acquisitions completed during the period are appropriately
time apportioned. The adjustment includes cash consideration, deferred and deferred contingent consideration,
debt acquired, cash acquired, and any cash impact of shareholder loans or other similar financial liabilities repaid
post acquisition.
AGM
APAC
APM
Articles
Annual General Meeting
Asia Pacific region
Alternative Performance Measures
Articles of Association of Uniphar plc
BESTMSLs Group
MDea, Inc, The Doctor’s Channel, LLC, and BESTMSLs, Inc
BModesto Group
BModesto Vastgoed B.V., BMclinical B.V., BModesto B.V., SynCo Pharma B.V., BMmedical B.V.,
Doncaster Pharma Limited
Board
CCPC
CDP
CEO
CFO
CGU
Company
Covid-19
CSO
CSRD
Diligent
Durbin
EAPs
EBITDA
ED&I
EEIO
EGM
EPS
The Board of Directors of Uniphar plc
Irish Competition and Consumer Protection Commission
Carbon Disclosure Project
Chief Executive Officer
Chief Financial Officer
Cash-Generating Unit
Uniphar plc
Coronavirus disease
Contract Sales Outsourcing
Corporate Sustainability Reporting Directive
Diligent Health Solutions, LLC
Durbin plc and Durbin Inc
Expanded Access Programs
Earnings Before Exceptionals, Interest, Tax, Depreciation and Amortisation
Equity, Diversity and Inclusion Policy
Environmentally-Extended Input-Output
Extraordinary General Meeting
Earnings Per Share
EPS Group
EPS Vascular AB, EP Endovascular AB and EPS Vascular OY
ERP
ESG
EU
FDA
FMD
FVOCI
FVPL
FY
GAAP
GDP
GDPR
GMP
GP
GxP
GRI
Group
HCP
HPRA
HSBC
HR
HSE
H&S
IAS
ICP
ICT
Enterprise Resource Planning
Environmental, Social, and Governance
European Union
Food and Drug Administration
Falsified Medicine Directive
Fair Value through Other Comprehensive Income
Fair Value through Profit or Loss
Financial Year
Generally Accepted Accounting Principles
Good Distribution Practice Regulations
General Data Protection Regulation
Good Manufacturing Practice Regulations
General Practitioner
‘good practice’ Quality Guidelines and Regulations
Global Reporting Initiative
Uniphar plc and Subsidiary undertakings of Uniphar plc
Healthcare Professional
The Irish Health Products Regulatory Authority
HSBC Continental Europe Bank
Human Resources
Health Service Executive in Ireland
Health and Safety
International Accounting Standard
Independent Community Pharmacy
Information and Communication Technologies
IEA NZE
International Energy Agency Net Zero Emissions
211
212
UNIPHAR PLC ANNUAL REPORT 2022OVERVIEWSTRATEGIC REVIEWPERFORMANCE REVIEWGOVERNANCEFINANCIAL STATEMENTS GLOSSARY OF TERMS CONTINUED
International Financial Reporting Standards
Incorporated
Irish Pharmaceutical Healthcare Association
Initial Public Offering
Independent Pharmacy Ownership Scheme
Information Technology
Key Performance Indicator
Leadership in Energy and Environmental Design
Long Term Incentive Plan
Managed Access Programs
Multi-Channel Account Managers
Middle East and North Africa
Medical Science Liaison
Mergers and Acquisitions
Not Applicable
Non-Governmental Organisations
National Healthcare Service in the United Kingdom
Other Comprehensive Income
IFRS
Inc.
IPHA
IPO
IPOS
IT
KPI
LEED
LTIP
MAPs
MCAM
MENA
MSL
M&A
N/A
NGO
NHS
OCI
Orspec Group
Orspec Pharma Pty Limited, Orspec Pharma PTE Limited, Orspec Pharma Management Limited
OTC
PAYE
PLC
PPE
PwC
Q1
Q2
Q3
Q4
Over the Counter
Pay As You Earn
Public Limited Company
Personal Protective Equipment
PricewaterhouseCoopers
Quarter 1 (1 January to 31 March)
Quarter 2 (1 April to 30 June)
Quarter 3 (1 July to 30 September)
Quarter 4 (1 October to 31 December)
QCA Code
Quoted Companies Alliance Corporate Governance Code
QMS
RBC
RCP
RNS
ROCE
ROI
ROW
RRD
SASB
SBTi
SDG
TCFD
Tc02e
TSR
UK
UK Code
Uniphar
UN
US
VAT
VPN
Quality management system
Royal Bank of Canada
Representative Concentration Pathway
Regulatory News Service
Return on Capital Employed
Republic of Ireland
Rest of the World
RRD International, LLC
Sustainability Accounting Standards Board
Science Based Target Initiatives
Sustainable Development Goals
Task Force on Climate-related Financial Disclosures
Tonnes of carbon dioxide equivalent
Total Shareholder Return
United Kingdom
UK Corporate Governance Code
Uniphar plc and Subsidiary undertakings of Uniphar plc
The United Nations
United States of America
Value Added Tax
Virtual Private Network
2018 pro-forma EBITDA
2018 pro-forma EBITDA of €46.3m as disclosed in our Admission document
213
Uniphar plc’s commitment to environmental sustainability is
reflected in this Annual Report. This report is printed in Ireland
using environmental print technology which minimises the impact
of printing on the environment. This report is printed on Horizon
Offset paper and board, which is chlorine free and sustainably
sourced from European managed forests.
Design: reddog.ie
UNIPHAR PLC ANNUAL REPORT 2022 Uniphar Head Office
4045 Kingswood Road,
Citywest Business Park, Co. Dublin
D24 VO6K
T +353 1 428 7777
www.uniphar.ie
U
n
i
p
h
a
r
p
l
c
A
n
n
u
a
l
R
e
p
o
r
t
2
0
2
2