Animalcare revenue steady at £70m as it reports profit

York-based Animalcare Group plc, the international animal health business, said on Tuesday its 2020 revenue slipped less than 1% to £70.5 million “demonstrating resilience in the face of COVID-19 disruption to key markets.”

Animalcare reported a statutory profit before tax of £200,000 compared to a £1.6 million loss in 2019.

The firm said market demand in the first quarter of the current financial year “is showing positive signs with a marked increase in revenues compared to the same period in 2020.”

The company said its internal pipeline is on track to deliver, with Daxocox (enflicoxib) receiving positive opinion from Europe’s Committee for Medicinal Products for Veterinary Use (CVMP) in February 2021.

Animalcare’s shares have risen more than 50% over the past 12 months to give the York firm a current stock market value of about £140 million.

On dividend policy, Animalcare said: “An interim dividend of 2.0 pence per share was paid in November 2020.

“The board is proposing a final dividend of 2.0 pence per share (2019: Nil pence per share) reflecting the resilient trading performance, strong financial position and our confident outlook …

“The board continues to closely monitor the dividend policy, recognising the group’s need for investment to drive future growth and dividend flow to deliver overall value to our shareholders.”

In his summary and outlook, chief financial officer Chris Brewster said: “Market demand in the first quarter is showing positive signs with a marked increase in revenues compared to the same period in 2020.

“Looking further ahead, and subject to the receipt of marketing authorisation in the EU and the UK, we continue to prepare for the launch of Daxocox during the second half.

“Together with the STEM oral health range, we expect these new products to support revenue growth over the full financial year and more significantly from 2022.

“We will also continue to optimise and refine our existing portfolio …”

Animalcare CEO Jenny Winter said: “It’s testament to Animalcare’s resilience, agility and focus that we were able to further strengthen our financial position and make significant strategic progress during an extraordinarily challenging year.

“The impact of COVID-19 was felt across all our markets in 2020, especially in the second quarter and most acutely in the Companion Animals sector.

“But despite widespread disruption to the operation of veterinary practices, we returned revenues ahead of market expectations, delivered continuing strong cash conversion and further reduced our net debt while investing in drivers of future growth.

“Strategically, we made significant headway across all areas of focus.

“The CVMP’s positive opinion for Daxocox in February 2021, and the product’s anticipated launch in the second half of the year, represents a major milestone for our pipeline.

“On the business development front, our September 2020 agreement with Kane Biotech opens up near- and long-term opportunities for exciting biofilm-targeting technologies.

“Optimisation of our existing portfolio remains a priority and we have continued to rebalance, refocus and defragment our line-up of products with a target to improve margins and concentrate sales and marketing resources on a smaller number of bigger brands.

“The pandemic threw the importance of effective leadership into even sharper relief in 2020.

“So I’m especially pleased that our latest annual employee survey showed a striking improvement in engagement levels.

“We also reshaped our organisational structure to better drive our growth strategy.

“The encouraging trading levels over the early months of 2021, combined with the evident benefits of the mass vaccination programmes and the adaptations made by the group, makes us confident that we will return to normal business conditions and growth this year.

“Thanks to the skills and commitment of our people across all our markets, Animalcare has entered 2021 in a strong position and we continue to execute our long-term growth strategy.”