Animalcare Group's revenue rises while weary of Brexit vote

Veterinary medicine supplier Animalcare Group’s revenue rose while it remains cautious over the uncertainty arisen since the Brexit vote as it took measures to hedge against currency fluctuations.

For the year ended 30 June, revenue increased 8.6% to £14.7m, compared to the previous year due to the company increasing sales of licensed veterinary medicines in the UK and export markets by over £650,000 combined.

This resulted in a 2.5% rise in pre-tax profit to £3.09m with export sales rising 23%.

Chief executive Iain Menneer said the Brexit result the EU referendum would “inevitably have an impact on our business”, although the extent is unclear but the timing of the result allowed it to put plans in place to incorporate the currency instability for the new financial year.

He said that the “encouraging” early progress of sales outside Europe will diversify its markets in the short-term, while subsequent changes to the European pharmaceutical regulatory framework are currently unknown.

During the year there was a “robust” increase in sales from the licensed veterinary medicines product group which reported a 7.7% rise in revenue to £9.2m.

In the companion animal identification product, revenue was up 16.1% to £2.7m, which included £300,000 from, the passing of a law in April which made it compulsory for dogs to be microchipped in England, Scotland and Wales.

Revenues from the animal welfare products range increased 5.1% to £2.78m.

Underlying operating profit climbed 2.6% to £3.2m and underlying basic earnings per share was up 3.2% to 13p.

The York-based company is debt free and reported a balance sheet with net cash of £7.1m, a 22.4% increase while cash generated from operations rose 2.2% to £4.6m.

There is a pipeline of products in development as planned investment increased 100% to £1.6m.

Menneer, said: “Whilst the animal health industry evolves with customer consolidations and supplier mergers and acquisitions we have shown that we can continue to grow organically through launching new products and providing a superior service to our customers.

“With the first products successfully through our development pipeline we will start to see early revenue growth with more significant impact in subsequent periods. More product registrations are expected in the current period.”

Animalcare recommended a 6.6% increase in the dividend to 6.5p per share.

Shares in Animalcare Group were down 3.52% to 283p at 0902 BST.