UDG Healthcare (UDG) made the largest acquisition in its history in March. The medicine wholesaler and pharma-services business acquired KnowledgePoint360, a global healthcare-marketing business, for €108m (£88m). KnowledgePoint, which has nine offices around the world, will be re-branded and integrated into UDG's Ashfield Commercial and Medical services division, making it the group's largest in terms of profit contribution.
Coupled with strong trading in the US, the acquisition drove a 36 per cent increase in operating profit at Ashfield. Elsewhere, trading was patchier. Higher costs and the ongoing substitution of generic drugs depressed operating profit in the wholesale business, while profit from the Sharp Packaging division fell 19 per cent to €7.5m. However, the latter division is gearing up to reap the benefits of a US regulatory change requiring packaged medicines to show unique barcodes by 2017 - a tricky technology which UDG has mastered. Chief executive Liam FitzGerald expects this barcoding business to pick up in 2015.
Exceptional items, acquisitions costs and other one-offs - notably corporate re-branding - totalling €19.8m dented reported profits. Exclude these items and operating profit rose 4 per cent to €45m. Peel Hunt expects pre-tax profit of €87.7m for the full year, giving EPS of 28.8¢
| UDG HEALTHCARE (UDG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 367p | MARKET VALUE: | £888m | |
| TOUCH: | 366-367p | 12-MONTH HIGH: | 380p | LOW: 293p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 39 | |
| NET ASSET VALUE: | 171¢* | NET DEBT: | 82% | |
| Half-year to 31 Mar | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2013 | 1.02 | 17.3 | 5.3 | 2.61 |
| 2014 | 1.04 | 17.2 | 4.9 | 2.69 |
| % change | +2 | -1 | -8 | +3 |
Ex-div: 21 May Payment: 17 Jul £1=€1.22 *Includes intangible assets of €455m, or 188¢ a share | ||||
