US-listed China Nepstar Chain Drug store has reported a US$2.1 million loss in the third quarter.

Same-store sales rose 8.1 per cent year-on-year and revenue increased by the same figure to US$120.3 million. But the net loss was more than double that of the same period last year.

But the company’s CEO Fuxiang Zhang said the company was pleased by the continuing momentum in same store sales and the next target would be achieving profit.

“Our promotional campaigns for pharmaceutical products are driving growth in sales as well as average transaction value. Moreover, our store optimisation strategy has created a network of stores with steadily increasing sales, enabling us to expand top line sales at a consistent pace.”

China Nepstar ended the quarter with 2048 directly operated stores, having opened 48 and closed 48 during the period.

During the quarter, the company’s portfolio of private label products expanded to 2146 types of products. Sales of private label products represented approximately 16.8 per cent of the revenue and 24.5 per cent of the gross profit for the third quarter of 2014.

“As we head into the fourth quarter during which we usually perform well, we anticipate continued growth in the sales of both pharmaceuticals and nutritional products, enabling the improvement of gross profit,” commented Zhang. “Looking ahead, China is gradually trending towards deregulation on pharmaceutical pricing after several years of vigorous implementation of stringent price controls. We believe this trend will be favorable for the healthcare retail sector in general, and we plan to capitalize on opportunities to realign pricing with the growing cost of goods.”