Rapid growth by Super-Pharm in Poland, and now in China, has led Super-Pharm CEO Lior Reitblatt to change his position regarding an issue on the Tel Aviv Stock Exchange (TASE). "The moment there's a huge breakthrough overseas within a two-year time frame, we'll have to pick up the pace of store openings, and it's logical for the public to participate," he told "Globes" today in an exclusive interview.
Reitblatt added, however, "There's no need to raise money at the moment. Who needs that headache?"
When "Globes" asked Reitblatt about a possible issue two years ago, he rejected the idea out of hand. He said at the time, "One of the advantages of working with the Koffler family is taking unpopular measures in terms of profit and loss, out of deep grasp of retail business and a long-term perspective. Going public is very cruel from the perspective of not looking at the bottom line today, but seeing what it does to the organization in five years. A measure, such as investing NIS 10 million in a customers club, would not be taken at a public company."
Reitblatt confirmed that he was a party at interest in Leon Koffler's businesses in Israel. Koffler owns Super-Pharm, and the Israeli franchises of Office Depot, Blockbuster and Toys-R-Us.
Commenting on Super-Pharm's entry into China, Reitblatt said today, "We've signed an agreement to buy shares in a Chinese company. The Chinese chain we're buying is controlled by a bankrupt foreign company that is in receivership. The purchase of the shares from the receiver has become difficult, because he has no interest in a quick sale."
Regarding Super-Pharm's business expansion plan, Reitblatt said, "The chain will have 180 stores in Israel in five years. We'll have more than 50 stores in Poland, and hundreds of branches in China."
Reitblatt also signaled that he would not hesitate to respond in kind of supermarket chains that are expected to slash prices for over-the-counter drugs in order to attract customers. "We'll go every price reduction one better," he said.
One of the growth engines Reitblatt is counting on is optics. "It doesn’t prevent growth for us, but profits."
Super-Pharm posted NIS 2.31 billion in sales for 2004. It opened seven new stores during 2004 to reach 112. Nine stores have already opened in Poland, and it will have fourteen there, with a total turnover of $22 million, by year-end.
Published by Globes [online], Israel business news - www.globes.co.il - on April 19, 2005