The positive impact of acquisitions and Asian growth helped medical proteins supplier Abcam (ABC) to partially offset the impact of spending cuts in its main medical research markets. Although - even after adjusting for contributions for the acquisition of Epitomics and Ascent Scientific - underlying full-year revenue still grew 11.8 per cent.
But management has been cautious about the impact of spending cuts on its business for some time and there was evidence that austerity has hit sales growth in the group's main markets. In the developed US market, for instance, which generates 40 per cent of Abcam's total sales, spending cuts helped to keep underlying revenue growth at a modest 4.8 per cent. Although other markets such as Europe and Japan were more robust - sales here increased by 12.5 per cent and 14.2 per cent, respectively, to £38.3m and £12m The emerging Asian markets delivered the best performance, however, and revenue here rose 27.4 per cent to £12.3m. The next big test for the company will be next month when details emerge of how $109bn (£69bn) of US government spending cuts will affect research grants and funding in 2014.
Broker Peel Hunt has cut its pre-tax profit forecasts for 2014 by 3 per cent to £48.9m, giving EPS of 18.8p (from £46.6m and 17.6p in 2013).
ABCAM (ABC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 490p | MARKET VALUE: | £977m | |
| TOUCH: | 490-491p | 12-MONTH HIGH: | 490p | LOW: 353p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 30 | |
| NET ASSET VALUE: | 85p* | NET CASH: | £38.8m | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 56.8 | 16.3 | 7.00 | 2.42 |
| 2010 | 71.1 | 25.8 | 10.7 | 4.01 |
| 2011 | 83.3 | 32.1 | 13.2 | 5.25 |
| 2012 | 97.8 | 34.7 | 13.7 | 6.05 |
| 2013 | 122 | 43.0 | 16.5 | 7.04 |
| % change | +25 | +24 | +20 | +16 |
Ex-div: 6 Nov Payment: 29 Nov *Includes intangible assets of £115m, or 58p share | ||||
