Uniphar ends first half in line with forecasts

Healthcare services business Uniphar reported interim results in line with expectations on Wednesday, with revenue rising 8.8% year-on-year to €871.33m (£775.71m).

The AIM-traded firm said its gross profit was 23.6% higher for the six months ended 30 June at €102.59m, while its gross margin rose to 11.8% from 10.4% a year earlier.

EBITDA was ahead 12.6% at €30.21m, while profit before tax rose 18.9% to €16.41m.

The company swung to net bank cash of €1.39m, from net debt of €160.97m at the end of the first half in 2019.

Uniphar said its basic earnings per share were 4.9 euro cents for the first half, down from 7.5 cents, while adjusted earnings per share slipped to 5.1 cents from 9.3 cents.

That decline in earnings per share was driven by an increase in the weighted average number of shares following Uniphar’s initial public offering, with the board reporting that On a like-for-like basis, adjusted earnings per share grew to 5.1 cents from 4.3 cents.

On the operational front, the company said it played a “critical role” during the Covid-19 pandemic, ensuring continuity in the supply of medicines, medical devices and related services to the healthcare sector.

It noted the successful completion of two acquisitions, one in product access and one in supply chain and retail.

In product access, the company acquired Innerstrength during the period, which it described as a Dublin-based healthcare technology company.

That further enhanced its digital offering, and accelerated Uniphar's ability to deliver patient-centric exclusive access programmes on a global basis, the board said.

Post-period end, Uniphar completed the acquisition of Hickey's in the supply chain and retail sector, which it said is a “leading chain” of pharmacies in Ireland, and would further strengthen its market share.

Leveraging its wholesale distribution facilities and scalable platforms would allow the firm to unlock synergies, the board said, with the acquisition still subject to approval by the Competition and Consumer Protection Commission in the Republic of Ireland.

The board noted that gross profit generated from outside of Ireland increased by more than 80% in the period.

An improved five-year banking facility had been agreed in July as well, enhancing the company’s liquidity to support its growth strategy.

“We have delivered a strong set of results for the first half of 2020 in a difficult operating environment, achieving gross profit growth across all our divisions and 5% organic gross profit growth at a group level, while maintaining a strong liquidity and net cash position at the end of the period,” said group chief executive officer Ger Rabbette.

“Our investment in digital solutions combined with diversity in our product and services lines has helped mitigate the impact of Covid-19 on our business and position us well into the future.

“We remain on track to achieve our strategic objective of doubling EBITDA within five years of initial public offering with continued strong growth in earnings per share on a like-for-like basis.”

Rabbette said the recent acquisitions demonstrated the company’s focus on higher-margin opportunities.

“Innerstrength is a strategic acquisition and significantly enhances our digital offering, accelerating Uniphar's ability to deliver patient-centric exclusive access programs on a global basis.

“In retail, the acquisition of Hickey's into our supply chain and retail division further improves our leadership position in the Irish market.

“These acquisitions combined will be earnings accretive from completion, and will be enhanced further through leveraging our existing platforms and unlocking synergies.”

At 0802 BST, shares in Uniphar Group were up 3.88% at €2.39 in London.