|Frauenfeld, 18 March 2021
Zur Rose Group further extends European market leadership and successfully implements healthcare platform
- Growth initiatives successfully implemented and platform strategy reinforced
- Result in line with targets announced: break-even at the EBITDA level before non-recurring effects and growth initiatives
- Prof. Dr. Andréa Belliger proposed for election to the Board of Directors
- Main focus in 2021 on seizing the opportunities from the introduction of electronic prescriptions in Germany
In the pandemic year of 2020 the Zur Rose Group exceeded its growth targets and continued to rigorously implement the platform strategy as digitalisation moves ahead. In line with the strategic thrust, in summer 2020 the Group acquired the mail-order activities of Apotal and leading telemedicine provider TeleClinic. Preparations for the introduction of electronic prescriptions in Germany are moving ahead at full speed. As part of this, in December 2020 the DocMorris healthcare platform was launched, a new additional business model offering added value for customers. The Group is emphasising this strategic focus with a changed brand architecture that sees DocMorris become the umbrella brand for the healthcare ecosystem. In Switzerland Zur Rose set up a joint venture with insurance partners Allianz Care, CSS and Visana to operate a comprehensive digital healthcare platform that will be launched in the second quarter of 2021.
At the operating level the Zur Rose Group has been extremely successful in a stressful pandemic situation. Action was taken early to protect employees' health and ensure customers were supplied with the medicines they needed at all times. Since the outbreak of the pandemic the company has seen consistently high acceptance of digital solutions and strong interest in e-commerce. In this dynamic environment the Zur Rose Group seized the market opportunities available and managed to successfully raise CHF 388 million for further growth initiatives in 2020 by issuing a convertible bond and conducting a capital increase. The acquisition of the mail-order and diabetes activities of German online pharmacy Apotal extended the Group's European market leadership as an e-commerce pharmacy. The purchase of TeleClinic also further strengthened the platform strategy. TeleClinic provides telemedical services and represents an important building block in the Zur Rose healthcare ecosystem. Thanks to the leading market position and offerings and digital services focused on customer needs, the Group increased revenue by 14.4 per cent in local currency terms to CHF 1,751.9 million (including Medpex and Apotal). This growth trend continued in all market segments: Switzerland, Germany and Europe. The number of active customers rose by more than 50 per cent year on year to 10.5 million.
Result in line with targets announced
The result at the EBITDA level reached break-even before non-recurring effects and expenditure on growth initiatives, putting it in line with the targets the Group had announced. The sustainable improvement in the gross margin and cost savings from integration measures increased the operating profit contribution by around CHF 30 million compared to the previous year. Conversely, non-recurring expenditure of CHF 21.4 million related to acquisitions and restructuring as well as impairments of CHF 12.1 million, mainly as a result of price falls in products to combat the pandemic, reduced profit. In addition, following an interim ruling in a VAT lawsuit relating to bonuses granted on prescriptions the Group took into account a risk position of CHF 13.7 million. Overall, adjusted EBITDA came to minus CHF 31.2 million. This includes expenditure on growth initiatives in electronic prescriptions, European opportunities and the healthcare ecosystem of CHF 30.3 million. The operating result (EBITDA) was minus CHF 78.4 million and net income/(loss) minus CHF 135.6 million.
National introduction of electronic prescriptions in Germany moves ahead
In anticipation of the mandatory introduction of electronic prescriptions (eRx) in Germany from 1 January 2022, the Zur Rose Group has driven forward a host of initiatives. Zur Rose subsidiary eHealth-Tec is a leader in digitalising prescription processes. Its eRx infrastructure fully covers the structure desired by gematik, the software service provider of the Federal Ministry of Health, and can already be used for doctors, patients and pharmacies today. In November 2020 gematik awarded the contract for the specialist e-prescription service in Germany to eHealth-Tec as partner to IBM. eHealth-Tec contributed its accumulated experience as a systems provider for e-prescription solutions to the IBM bid submission. Implementation includes supplying the necessary infrastructure and operating and supporting the hardware and software components to be able to process the entire volume of e-prescriptions generated in Germany.
Launch of the DocMorris+ healthcare platform
The market launch of the DocMorris+ healthcare platform in December 2020 marks a strategic milestone on the path towards an integrated healthcare platform, opening up a new business model and a new era in healthcare provision in Germany. In the start phase the focus is on the capabilities of the partner network and OTC orders by mail order. In future the platform will provide easy access to all healthcare services in one place - from diagnosis with an online doctor to the drug or healthcare products needed. The consumer offering on the platform will be steadily extended in terms of product range and services such as faster delivery options and the e-prescription module, gradually making the platform a strong distribution channel for partner pharmacies and other healthcare providers.
Healthcare management at a single click
With an eye to the intended European digital healthcare ecosystem, Zur Rose is pursuing the vision of creating a world where people can manage their health in one click. The collaboration with global healthcare company Novo Nordisk agreed in January 2021 is another major step towards the ecosystem. The aim is to enter into further cooperations with best-in-class healthcare services linked to the core business of the Zur Rose Group.
New brand architecture emphasises changed strategic focus
Since December 2020 pharmacy DocMorris and healthcare platform DocMorris+ have been using a new brand identity. This is part of a newly designed brand architecture, with DocMorris as the best known pharmacy brand in Germany forming the umbrella brand for the ecosystem. The company will focus even more closely on customers and caring for their health. A logical consequence of this shift in outlook is to replace the previous pharmacy cross with a symbol of people and their health - the heart. The new brand architecture and associated appearance will be rolled out in stages in all core markets except Switzerland by 2026. In February 2021 the two marketplaces, PromoFarma in Spain and DoctiPharma in France, were linked to the DocMorris brand identity. The "by DocMorris" lettering is the brand tag and shows both marketplaces belong to the European healthcare ecosystem. The Zur Rose Group launched a multi-media campaign across Germany in February 2021. This shows the DocMorris brand as an approachable and reliable partner and makes the digital services on the healthcare platform come alive.
Allianz Care, CSS, Visana and Zur Rose Group launch digital healthcare platform
In November 2020 the Zur Rose Group announced the creation of a joint venture with insurers Allianz Care, CSS and Visana to operate a full-service digital healthcare platform. The platform is scheduled for launch in the second quarter of 2021 and sets new standards in Swiss healthcare and lays the foundations for digitally supported, integrated provision. This is open to all players in the healthcare sector: insurers, doctors, hospitals, pharmacies and other providers can offer their services. At a single click patients get access to personal healthcare services such as doctor's appointments, video consultations, pharmaceutical advice, electronic prescriptions and much more besides. The core contribution by the Zur Rose Group will be to provide some of the technology for the platform. Parts of the Zur Rose platform will be licensed to the joint venture for this purpose. Implementation and the market launch are subject to approval by the relevant competition authorities.
Shop-in-shop concept and online shop with Medbase on the way to success
Under the auspices of the joint venture with Medbase, the Migros healthcare provider, November 2020 saw the opening of a shop-in-shop pharmacy in Crissier in the canton of Vaud, marking entry into the market in western Switzerland. Zur Rose is following an omni-channel approach with the pharmacies. The new presence in the French-speaking part of the country will be used to boost the activities of its e-commerce business. A pharmacy is scheduled to open in Schönbühl, near Bern, in June 2021. This will take the number of shop-in-shop pharmacies operated by the joint venture to seven in total. The online shop run by the joint venture is also doing well against the competition and confirms the general move towards more online purchases: revenue more than doubled year on year, putting it well ahead of budget. In the medium term the online shop will operate as a marketplace where other partners are able to offer their products.
Management structure broadened and Group Management now complete
The Zur Rose Group adapted its management structure in 2020 to meet the needs and opportunities of a company that has grown considerably. Alongside the regional segment organisation with revenue responsibility, a cross-segment business model organisation and two additional service units were set up. Group Management was expanded accordingly as from 1 May 2020 with the addition of Betül Susamis Unaran as Chief Strategy and Digital Officer, Bernd Gschaider as Chief Operations Officer and David Masó as Head Europe. Olaf Heinrich, Head Germany, left the company in December 2020 and was succeeded by Walter Hess, formerly Head Switzerland. The long-standing head of the Swiss physicians business Emanuel Lorini was made Head Switzerland and a Member of the Group Management.
Increased efficiency from integration in Germany
In order to capture potential synergies and cover the market more effectively, at the start of 2020 the Germany segment switched from brand-based management to country-based management. The management team of the Germany segment of the Zur Rose Group was also strengthened so as to drive ahead the integration of individual companies and achieve economies of scale. As part of the reorganisation, over the course of the year the Group brought together various service functions which had their own staff and resources in Heerlen and Mannheim. Vitalsana, which had been based in Heerlen, was legally and economically merged with DocMorris, and the site closed. Some departments of Eurapon Pharmahandel GmbH, Bremen, and Zur Rose Pharma GmbH, Halle, were brought together at the Heerlen and Mannheim sites. Construction work on the new logistics infrastructure at Heerlen is proceeding as planned and will more than double capacity at the site in 2022. The Zur Rose Group is thus laying the foundations to cope with the logistical consequences of the planned growth.
Changes in the Board of Directors
Tobias Hartmann will not be standing for re-election to the Board of Directors at the 2021 Annual General Meeting of Shareholders. The Board would like to thank him for his commitment and dedication. The Board has decided to propose Prof. Dr. Andréa Belliger as a new member to the Annual General Meeting being held on 29 April 2021. Andréa Belliger is Prorector of the Teacher Training University of Central Switzerland and director of the Institute for Communication and Leadership IKF in Lucerne. She also sits on the boards of directors and advisory boards of various Swiss and German companies in the healthcare, financial, insurance and energy sectors and chairs the advisory board of healthcare services provider Medbase (part of Migros). She is an author and international keynote speaker on digital transformation issues, particularly in healthcare. In 2019 she was voted one of the 25 most influential people in the Swiss healthcare industry. Chairman of the Board Prof. Stefan Feuerstein commented: "We are delighted to have been able to persuade Prof. Dr. Andréa Belliger to stand for our board; she is a strong leadership personality and a proven expert in digitalisation in healthcare."
Sustainability at the Zur Rose Group
The Zur Rose Group attaches great importance to managing and developing the business in a way that is sustainable and compatible with economic, social and ecological goals. Recent years have seen numerous sustainability initiatives. In 2020 the Group started using these initiatives as a basis for developing a sustainable approach that can be applied systematically to the company as a whole. For the first time the 2020 annual report provides an overview of how the Zur Rose business model is linked to sustainability and the strategy the Group is adopting towards business ethics, social responsibility and environmental protection. The objective is to expand transparency in these issues and sustainability reporting over the coming years.
Changes to the visual appearance of the Zur Rose Group
Changes to the visual appearance of the Zur Rose Group are appropriate following the strategic focus with the revised brand architecture and DocMorris as the umbrella brand for the healthcare ecosystem. The role as the overall corporate brand and the stronger distinction from DocMorris will be reflected in the new logo. This will become a pure word brand, and from now on the letters R and D will no longer be intertwined. At the same time the key central brand elements, the typeface and colours, are being harmonised, adding visual strength to the Group identity. As part of the updating of the brand structure and visual appearance, the corporate values have also been adjusted. The aim and purpose of all these measures is to clearly distinguish roles and provide greater entrepreneurial scope for DocMorris and the Zur Rose Group. This takes account of the fact that the two brands perform different functions within the company and serve different stakeholders. The new visual appearance can be seen for the first time in the annual report and will be gradually rolled out across all other elements.
Main focus in 2021: seizing the opportunities from the introduction of electronic prescriptions
In 2021 the Zur Rose Group will be putting its main focus on seizing the opportunities from the introduction of electronic prescriptions in Germany, which will be mandatory from 1 January 2022. This will see the barrier of sending paper prescriptions removed. With over nine million customers in the German market and DocMorris as Germany's best-known pharmacy brand, the Group is excellently positioned to win customers with its service and mail-order offering and boost revenue in this area substantially once the necessary infrastructure has been put in place.
Management assumes that in the medium term - over a time horizon of three to five years - online penetration of prescription medicines in Germany can reach a level of around 10 per cent as a result of the mandatory introduction of electronic prescriptions (eRx), with further potential beyond this period. The Zur Rose Group expects to exceed the sales threshold of CHF 4 billion towards the beginning of this medium-term time horizon as a result of organic growth. The Group also confirms the medium-term EBITDA margin target of around 8 per cent. Implementing the healthcare ecosystem will create further relevant potential for revenue and profit.
For 2021 management expects revenue to rise by around 20 per cent (including Medpex and Apotal). The first eRx revenue is expected once the gematik eRx infrastructure is in place (probably in July 2021), with a significant increase anticipated from 2022 onwards following the introduction of mandatory eRx. An extensive marketing campaign was launched in February 2021 to raise awareness of the European umbrella brand DocMorris. The aim is for break-even at the EBITDA level 12 to 18 months after 2021.
|Key financials, in CHF million
|Net revenue incl. Medpex and Apotal1
|Year-on-year-change incl. Medpex and Apotal in % in local currency
|Year-on-year change incl. Medpex and Apotal in %
|Year-on-year change in %
|Gross margin in % of revenue
|Earnings before interest, taxes, depreciation and amortisation (EBITDA) adjusted
|in % of revenue
|Earnings before interest, taxes, depreciation and amortisation (EBITDA)
|in % of revenue
|Earnings before interest and taxes (EBIT)
|in % of revenue
|Net operating income
|in % of revenue
|in % of total assets
|Number of employees (in full-time equivalents) at year end
1) As the spin-off of the mail order business has not yet been completed, no revenues from Medpex and Apotal could be consolidated.
The full online 2020 Annual Report can be found at https://gb.zurrosegroup.com/en.
At 2 p.m. CET today there will be a telephone conference in English for analysts and the media.
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Investors and analyst contact
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The Zur Rose Group is planning to hold a Capital Markets Day in the second quarter of 2021. The precise date and agenda will be announced at a later date.
20 April 2021 First Quarter Trading Update
29 April 2021 Annual General Meeting
18 August 2021 Half-Year Results
21 October 2021 Q3 Trading Update
Zur Rose Group
The Swiss Zur Rose Group is Europe's largest e-commerce pharmacy and one of the leading medical wholesalers in Switzerland. It also operates the leading marketplace in southern Europe for consumer health, beauty and personal care products commonly sold in pharmacies. The company is internationally present with strong brands, including Germany's best-known pharmacy brand DocMorris. Zur Rose employs more than 2,200 people at sites in Switzerland, Germany, the Netherlands, Spain and France. In 2020 it generated revenue of CHF 1,752 million (including Medpex and Apotal) and currently has 10.5 million active customers in core European markets.
With its business model, the Zur Rose Group offers high-quality, safe and cost-effective pharmaceutical care. It is also characterised by the continuous further development of digital healthcare services and platform technologies. Zur Rose is furthermore actively driving ahead its positioning as a comprehensive healthcare service provider. The focus is on building up the European healthcare ecosystem, where qualified providers network to provide products, services and digital solutions. The contribution made by Zur Rose will be to take these offerings to customers and patients. The Zur Rose vision is to create a world where people can manage their own health in one click
The shares of Zur Rose Group AG are listed on the SIX Swiss Exchange (securities number 4261528, ISIN CH0042615283, ticker ROSE). For further information please see zurrosegroup.com.
 As the separation of the mail-order business has not yet been completed, Medpex and Apotal had only a minor impact on the consolidated revenue of the Zur Rose Group.
 Customers supplied by the Zur Rose Group, either directly or through its partners.