On behalf of the Management Boards of the Pelion Healthcare Group companies, I present to you the report discussing our performance in 2014.
Pelion’s history is nearly as long as the history of the democratic and independent Poland. In 2014, when Poles celebrated 25 years of democracy, our company celebrated its 24th anniversary. During that time, Poland became an important member of the European Union and we have built one of the largest healthcare groups and a strong player operating in two EU Member States – Poland and Lithuania. We are proud to see Pelion’s history intertwined with the history of independent Poland and to know that we have contributed to building our country’s modern economy and civic society.
Our overriding goal remains to create an all-inclusive offering for our customers, which is not only innovative, but also safe and reliable. We want to continue as a leader of the Polish and Lithuanian healthcare markets and further develop our business lines. Healthcare is a major global challenge; in this context, Pelion’s role will be to drive change and set directions for the healthcare business.
2014 was an important year for Poland – the time to look back and reflect on the past. At the same time, it was also a very difficult period for the Polish pharmaceutical distribution sector, bringing a number of unfavourable amendments to Polish pharmaceutical law with a direct impact on the security of pharmaceutical trade and consequently on the performance of the entire healthcare system. Above all, it was yet another difficult year for Polish patients, owing to the decision to introduce fixed prices of reimbursable drugs and obstacles to free communication between pharmacies and patients. This prevented the growth of pharmacy business in line with the patients’ expectations, making the trade in reimbursable drugs unprofitable for companies intent on maintaining high service levels (especially in terms of product availability), which seriously undermined the position of Polish pharmacies. Pelion was no exception to the rule and our 2014 financial performance was not satisfactory.
In response to those challenging market conditions, we took decisive action, in particular in the retail segment, to further reinforce our customer-oriented approach. We also built a tightly controlled and fully secure drug distribution system to guarantee availability of drugs at pharmacies. It is of particular importance for patients in Poland, where the improper assessment of possible consequences of changes to pharmaceutical distribution regulations has led to market aberrations such as illegal drug exports. The measures we have taken will guarantee a fully secure drug distribution system and boost our performance and competitiveness; they will also offer a safe solution for drug manufacturers, with a guarantee that their products will actually reach Polish patients.
Our business is growing dynamically, as demonstrated by our recent entry into the health & beauty segment. In Q4 2014, we closed the acquisition of the Natura beauty supply stores and opened the new year with plans for continuing growth.
Pelion’s customer-oriented approach and focus on trading partners and investors, as well as consistent management and drive for innovation, gained recognition both in Poland and in Lithuania. As a result, we reported higher sales and stronger market standing for the 24th consecutive year. We are a reliable and trustworthy partner and we know how to bring our business in line with the changing market landscape.
At Pelion, we believe that undertaking specific measures to improve the standards of healthcare and the quality of life is an objective stemming from the principles of social responsibility. To that end, we implement and support projects of the ‘Dbam o Zdrowie Foundation’, helping people who are denied access to medical treatment due to financial difficulties.
We also take care to cultivate the traditions and values of Polish pharmacy and promote active lifestyle and disease prevention. We are most proud that 2015 will see the 5th edition of the marathon ‘DOZ Maraton Łódzki z PZU’
Our efforts and focus on sustainable development, with the involvement of everybody across the company, did not go unnoticed: we were again included in the Respect Index – the index of socially-responsible companies listed on the Warsaw Stock Exchange. It is a proof that we continue to operate in keeping with the highest CSR standards.
We also find it very important that the corporate values are reflected in our work standards and good relations with employees. Pelion is meant to be an open and diversified company, where every person is given a chance to develop both professionally and personally, in the spirit of trust and cooperation.
We believe that our success will depend on the delivery of our business strategy, driven by the highest standards of work of all members of our team and the ability and courage to face challenges. At Pelion, we have no doubt that operational effectiveness and flexibility, combined with innovative solutions, will continue to drive our market leadership. We have a good healthcare plan – and we know how to make it work.
We want to thank all our Shareholders, Customers, Partners and Employees for your cooperation and contribution. Together, we are building a truly modern and successful company.
President of Pelion Management Board