4 months ago
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Medical Disposables and Supplies Limited has chalked up another year in the red.
But CEO Kurt Boothe says the end of the downturn is in sight.
The distribution company made a net loss of $281 million at year ending March 2025, which was a better outcome relative to the $316 million bleed reported the previous year.
“We knew that remedying the situation was no overnight feat. We expect to work through cost structure adjustments to head towards positive territory within the financial year,” Boothe told the Financial Gleaner.
Sales in the year just ended amounted to $3.88 billion and was nearly five per cent better than the 2024 revenue flows. It was buoyed by recovery in key segments, the company said.
But MDS’s cash position worsened in the period, with the cost of debt servicing outpacing the cash from operations. Net cash also fell back into deficit of $224 million erasing the positive flows of $26 million in the prior year.
Outside of its coffers, the company has over $600 million of receivables, that is, monies to be collected for goods already sold, the size of which Boothe said was partly due to material growth in business in the medical division of the company over the past two years.
MDS has “a remarkable credit control system, which has been in effect for quite some time,” he said.
The medical segment primarily consists of hospitals, many of which are public institutions. “That presents greater challenges with regards to timing of collections” but the “overall credit risks are low,” Boothe argued.
Receivables for FY2025 amounted to $630 million, which represents 16 per cent of top line revenue, and is in line with the 14-17 per cent outturn over the past four years, he said.
Operations at subsidiary Cornwall Enterprises Limited, CEL, remains a drag on MDS. CEL holds the assets of Cornwall Medical and Dental Supplies – a distributor of medical equipment, medical disposable products and dental supplies and owner of Corn-Med Pharmacy – which was acquired by MDS in 2021.
Boothe said MDS would be tightening up operations at CEL.
“The subsidiary, CEL, experienced some decline due to supplier changes. Going forward, we intend to focus on the more profitable areas of that core business in our strategic response,” he said.
The company’s cash position also worsened in the period, with the cost of debt servicing outpacing the cash from operations. Net cash fell back into deficit of $224 million erasing the positive flows of $26 million in the prior year.
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