BR Pharma studies do a capital increase

Under the risk of failing to meet financial commitments with investors who bought their debentures, the Brazil Pharma, fourth largest network of pharmacies in the country, seeking ways to capitalize on the operation. In recent quarters, the company has discounted receivables in advance. Cash flow generation capability at a level below the expected may lead to company to announce in the next few weeks, another measure to consider its capital structure.
BTG Pactual, creator and principal shareholder of BR Pharma, is studying the possibility of making a capital increase in the retailer, which may be accompanied by all shareholders who don't want their small slices. In operation, the Bank should stick with new shares issued by the company with an award in relation to the current market listing-only this year, the BR Pharma ON accumulates fall about 40% (see chart). BTG must expand its stake in the company.
An analysis of the capital structure of the network of pharmacies is being made. And is also an ongoing review of the budget. The goal is to raise its cash generation capacity in the short and medium terms.
In the third quarter the company reported that the term discount of receivables had fallen from 24 to 5 days, "reflection of advance operation of receivables to cash need to honor short-term commitments". BR Pharma may have made new anticipation of receivables in the fourth quarter of the year (see below).
BR Pharma publishes today the balance of the fourth quarter after the close of trading. At the end of September 2013 the cashier balance was r $ 213 million a year earlier totaled R $ 405 million.
BR Pharma was established in 2009 and made its IPO in 2011, with the purpose of consolidating networks of pharmacies. Conversations between her and the American Walgreens came to occur, but not advanced. The situation today repeats a recipe I've seen at other listed companies: acquisitions closed in fast-paced and difficulties to integrate so many operations.
"The Brazil Pharma bought a big operation in the Northeast, another in the South, has a distribution center in Brasilia and retained the seat in the District of Vila Olímpia, São Paulo," says a manager who prefers not to identify. "There's no synergy capture and with a structure that was unfeasible look all business".
The integration of management systems and the commercial (purchasing and logistics) purchased by networks BR Pharma has advanced, but stopped at Big Ben, Northern and northeastern retailer acquired in 2012.
Responsible for 42% of group sales, the Big Ben-commanded by Raul Aguilera, who got into the business after the sale-until today negotiates separately with suppliers; does not use SAP system and is out of the shared service center. "If Big Ben not to enter, generate win will be very difficult," says a source. The expectation is that this advance in the second half.
Another problem has to do with inventory management. Because of a project called "break zero", in a moment of exchange of distribution centers, the BR Pharma has decided to increase the stocks to maintain the level of services the shops. But the volume of finished inventories rising too much. In some stores, reached 120 days. Internally, the management estimates that the increase was precipitated. The stock has been dropping and reaches today lower levels than in the third quarter.
As BR Pharma was created via quisições, the owners of networks acquired remained ahead of deals and coexistence with BTG, financial executives in charge of the operation, was not peaceful. According to sources, the noises caused by differences in management would have taken Raul Aguilera, Big Ben, the almost going out of business in 2013. Aguilera has extensive knowledge of retail and understood that the company was administered as a bank. Ended up quitting out of the company after the guarantee that there would be changes in command of the group.
There are 15 days, the Brazil Pharma announced the return of the President. André Sá, BTG partner, left the post. In his place came José Ricardo Mendes da Silva, who was in charge of the Aché of the 2006 farmacêutivo laboratory 2013. Silva has approached the partners among networks acquired controllers, only Raul Aguilera and Álvaro José da Silveira, the Rosary, are in BR Pharma today. In addition to studying ways to increase the cash generation, the new CEO has focused his work on actions to improve profitability.
Pedro Zabeu, an analyst at Brokerage Factor evaluated the Exchange as positive. "The company signals that is changing the management for a higher profile dedicated to the industry," said the analyst. In addition to the new President, the BR Pharma also moved in November on commercial direction. Álvaro José da Silveira, founder of Rosario, took over this function.
Wanted, BR Pharma and BTG are not expressed.