It's good to see balance returning to woundcare and surgical specialist Advanced Medical Solutions (AMS). In 2015, sales from products sold directly in the UK, Germany and the Czech Republic suffered, but the first six months of the current financial year have seen a return to growth across all business divisions.
As expected, this growth was particularly impressive in the US, where sales of the LiquiBand medical adhesive products are flying, up 74 per cent at constant currencies. Stateside sales are also expected to be enhanced by the recent regulatory approval of Resorba products. Initial sales came in at £0.1m and good feedback gives hope that more orders will follow.
Shareholders will also, no doubt, be relieved to see a return to growth in the group's home market. In 2015, UK sales of LiquiBand were badly affected by the launch of a cheap competitive product, but AMS's market share is now back on the rise. According to chief executive Chris Meredith, this comes as no surprise considering the superiority of the AMS range. Overall revenue from the direct sales business rose 5 per cent at constant currencies.
A helping hand in the form of favourable currency movements has prompted several analysts to raise their forecasts. Numis now expects 2016 pre-tax profits of £19.9m, giving EPS of 7.3p, up from £17.4m and 6.9p the prior year.
ADVANCED MEDICAL SOLUTIONS (AMS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 235.8p | MARKET VALUE: | £496m | |
| TOUCH: | 234.8-235.8p | 12-MONTHHIGH: | 239p | LOW: 151p |
| DIVIDEND YIELD: | 0.4% | PE RATIO: | 33 | |
| NET ASSET VALUE: | 54.7p* | NET CASH: | £41m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 32.7 | 8.0 | 3.2 | 0.25 |
| 2016 | 39.2 | 9.0 | 3.5 | 0.30 |
| % change | +20 | +12 | +10 | +20 |
Ex-div: 29 Sep Payment: 28 Oct *Includes intangible assets of £50m, or 24p a share | ||||
