RedCare Pharmacy has updated its fiscal 2026 outlook following a positive trading update released ahead of second-quarter results scheduled for July 29. The company raised guidance across several metrics - including group revenue, non-prescription sales, German prescription revenue and adjusted EBITDA margin - after reporting stronger sales momentum in April and May.
Group revenue growth accelerated to 20% year-over-year in April and May, up from 18% in the first quarter. In Germany, prescription revenue climbed 57% year-over-year during the first two months of the second quarter, reaching €118 million.
On the back of this performance, RedCare increased its fiscal 2026 German prescription revenue projection to a range of €680-720 million, up from prior guidance of above €670 million. That revised range implies year-over-year growth of roughly 35-43% for German prescription revenue.
Non-prescription sales in Germany also strengthened, accelerating to 14% year-over-year growth overall, with a rise from 12% in April to 16% in May. International sales held steady at 16% year-over-year growth across nearly all markets where the company operates.
At the group level, the company now expects fiscal 2026 group revenue growth of 15-17%, up from the previous 13-15% range. Guidance for non-prescription sales was raised to 10-12% growth from 8-10% previously. Adjusted EBITDA margin guidance was lifted to a 2.5-3.0% range, compared with the prior target of "above 2.5%."
Jefferies highlighted that the new guidance implies an adjusted EBITDA of approximately €94 million at the midpoint, which sits about 12% above market consensus and higher than RedCare's earlier guidance. The broker noted that an increased fixum taking effect from July onward should contribute to achieving the revised target.
RedCare will not publish its customary preliminary sales numbers in early July, the company added.
Context and implications
The updated guidance reflects stronger top-line momentum in both prescription and non-prescription channels, particularly in Germany where prescription sales posted double-digit growth. The raised adjusted EBITDA margin range and the midpoint EBITDA figure that exceeds consensus suggest a more favourable near-term profitability outlook, contingent on the components supporting the higher target - including the increased fixum referenced by Jefferies.
What to watch next
- The second-quarter results due on July 29, which will provide the detailed financial and operational metrics behind the trading update.
- Confirmation that the increased fixum instituted from July is delivering the incremental contribution assumed in the revised guidance.
- Any explanation for the decision not to release the usual preliminary sales figures in early July.