Fontana spends over half-billion on Monarch
Fontana Limited said it spent more than $672 million to acquire the Monarch Pharmacy business during the same quarter in which it reported an 11 per cent increase in net profit to $102.79 million.
This was revealed in the company’s third quarter (January to March) report which noted that the company raised $650 million from a bond issuance to pay for the acquisition. Fontana had announced in January that it was set to acquire the Monarch business from Gerk Limited, the entity through which owned it for the last 35 years. Monarch operates three locations in St Andrew and one in Portmore, St Catherine.
“We are excited about the additional four locations from the Monarch acquisition and have spent the last several weeks renovating and re-stocking the stores with a wide array of new products. We have now re-opened 3 of the stores (Barbican Loshusan, Portmore Sovereign, Tropical Plaza) and are making the necessary changes to open the 4th store at [Liguanea] Sovereign Centre shortly,” stated Anne Chang, Fontana’s CEO in the quarterly release.
The total consideration paid for the Monarch business wasn’t stated, but it was shown that there was $350 million in notes payable to Gerk due between August 2025 to January 2026. $672.06 million was recognised in the company’s cash flow statements for the acquisition of goodwill related to Monarch.
The Monarch acquisition increased Fontana’s store count and reach from seven to 11. Fontana’s locations prior to the Monarch acquisition included Mandeville, Montego Bay, Ocho Rios, Savanna-la-Mar, Barbican, Waterloo Road and Portmore. Fontana had spent more than $450 million on the development of its Portmore location, which opened in November 2023.
Fontana grew its Q3 revenue by 15 per cent from $1.94 billion to $2.24 billion as it benefited from the improved traffic at its Portmore location which recently added the MyJPS Care Hub recently to its location. The company’s gross profit improved by 15 per cent to $835.86 million with the gross profit margin at 37.36 per cent.
Although Chang didn’t give a timeline as to how the Monarch integration in the quarterly report, she noted that the company’s 13 per cent increase in operating expenses to $687.74 million was largely due to the additional staffing costs for the phased opening of the new Monarch locations. Despite the increase operational expenses, Fontana’s operating profit improved 25 per cent to $148.12 million with profit before tax rising by 14 per cent to $122.36 million.
For the overall nine months, Fontana’s revenue was up 16 per cent to $7.02 billion with operating profit rising by 12 per cent to $626.04 million. Although profit before tax grew 12 per cent to $570.75 million, the company’s net profit dipped one per cent to $489.84 million due to the higher tax bill in the current period since its 100 per cent tax remission expired in January 2024. Fontana’s trailing 12 months earning per share was $0.46. Fontana recently launched Ora by Fontana and had the launch of Fenty Beauty products which should improve revenue.
Fontana’s total assets rose 22 per cent to $6.95 billion with current assets at $4 billion and $1.72 billion in cash. Total liabilities and shareholder’s equity ended the period at $3.86 billion and $3.08 billion, respectively.
Fontana’s share price closed Thursday at $9.12 which left the stock up 13 per cent in 2025 with a market capitalisation of $11.40 billion. Fontana’s board will consider a dividend on May 26. It was also revealed in the quarterly report that Wayfair Holdings Limited bought 8.65 million shares of Fontana from Burbank Holdings Limited on March 24 at $9 per share.

