Shares in speciality pharmaceuticals and services company Clinigen (CLIN) are trading at an all-time high, even after news that profits plunged in the year to 30 June 2015. The group's recent £225m acquisition of Idis explains this, as costs associated with the deal carved a £17.8m hole out of the bottom line. Chief executive Peter George said most of those costs won't be repeated in the new financial year, although "some will inevitably trickle through".
More importantly, the group will incur further acquisition-related costs following its takeover of Link Healthcare - a deal announced alongside these full-year results. Clinigen will pay an upfront sum of £44.5m for Link and up to £100m more if certain clinical milestones are met on time. Mr George said the deal was attractive because it gave Clinigen access to lucrative markets across Asia, Africa and Australasia "all in one go".
While the integration of the two new companies continues, trading looks strong. Last year underlying cash profits rose 20 per cent for the third year in a row to stand at £32.3m. Analysts at Numis expect pre-tax profits this financial year to reach £48.2m, giving EPS of 33p, compared with £31m and 28.2p for the year ended June 2015.
| CLINIGEN (CLIN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 738p | MARKET VALUE: | £809m | |
| TOUCH: | 735-738p | 12-MONTH HIGH: | 774p | LOW: 432p |
| DIVIDEND YIELD: | 0.5% | PE RATIO: | 123 | |
| NET ASSET VALUE: | 187p* | NET DEBT: | 38% | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 35 | 6.8 | n/a | nil |
| 2012 | 82 | 10.3 | 13.2 | nil |
| 2013 | 123 | 14.5 | 15.1 | 2.6 |
| 2014 | 127 | 21.3 | 19.6 | 3.1 |
| 2015 | 184 | 8.4 | 6.0 | 3.4 |
| % change | +46 | -61 | -69 | +10 |
Ex-div: 15 Oct Payment: 6 Nov *Includes intangible assets of £308m, or 281p a share | ||||
