Shares of York-based Animalcare Group plc, the international animal health business, rose about 3% on Thursday after it published a trading update for the six months ended June 30, 2021, reporting a double-digit increase in revenues and further strengthening of its financial position in the first half.
“Total sales for the period were £39.1m, an increase of £4.6m or 13% (14% at CER) on the prior year helped by increased veterinary demand,” said Animalcare.
“We saw growth across our markets with the companion animals portfolio the driving factor.
“The group’s position in this growing segment of the market is due to receive a further boost as ongoing investment in the pipeline and business development delivers.
“Notably, Daxocox launch activities commenced at the end of the first half while the STEM dental range of products remains on track to complete manufacturing transfer and launch in late Q4.”
Daxocox is a treatment for pain and inflammation associated with osteoarthritis or degenerative joint disease in dogs.
Animalcare added: “The rate of growth in underlying EBITDA for the first six months is expected to be ahead of revenue, reflecting a higher margin product mix and positive leverage over the period.
“Recognising the beneficial effect of phasing during the first half, and consistent with board expectations, we maintain our outlook of increased revenues for the full year.
“Continuing strong cash generation drove further reduction in net debt in the period.
“Accounting for payment of the final dividend post-year end, net debt is approximately £10.1m, down by around £3.5m (26%) from 31 December 2020 (£13.6m).
“As a result, the net debt to underlying EBITDA leverage ratio is well below our target range of 1.0 to 2.0 times, further strengthening our financial position to enable investment in future growth which remains a key strategic objective.”
Animalcare CEO Jenny Winter said: “We’re delighted to have made such a positive start to the year after a challenging 2020 for the Animalcare team and our customers.
“Focused execution of our growth strategy has enabled us to take advantage of increased demand across our markets and further strengthen our financial platform as we pursue opportunities that will create long-term value.
“Our outlook for the full year remains unchanged at this time and we remain upbeat on the prospects for the group.
“We are now in full launch mode for Daxocox and though it’s still early in the journey for this differentiated new pain treatment we are excited about the response we are getting from our customers.”