There's always a question mark over the value that an acquisition will bring, but so far veterinary pharmaceuticals group Dechra (DPH) has the answers. Its purchase of Croatian animal health business Genera in October conspired with a stellar performance in North America - where turnover was up more than half - to push underlying operating profits up by 24 per cent, at constant currencies, to £26.3m for the reported period.
The Genera acquisition was a boost to the farm animal products division, offsetting a sales decline in Germany. Overall, divisional turnover rose 19 per cent at constant currencies. Meanwhile, Dechra's largest division by sales - companion animal products - registered a 15 per cent rise in constant-currency turnover to £62.6m, but the group's diets business suffered a small drop in sales on the same basis due to a change of supplier and the loss of a large Scandinavian client.
Post-period end, Dechra notched up another acquisition - this time tapping into the Mexican market with its purchase of Brovel. That is in addition to the new subsidiaries opened in Canada, Poland and Austria in the last 18 months.
Broker Investec raised its forecasts off the back of these results and now expects full year EPS of 41.5p for the 2016 financial year, up from 39.9p in FY2015.
| DECHRA (DPH) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,138p | MARKET VALUE: | £1bn | |
| TOUCH: | 1,135p-1,140p | 12-MONTH HIGH: | 1,141p | LOW: 901p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 29 | |
| NET ASSET VALUE: | 233p* | NEBT DEBT: | 9% | |
| Half-year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 101 | 12.6 | 11.8 | 5.12 |
| 2015 | 111 | 14.2 | 12.9 | 5.55 |
| % change | +10 | +13 | +9 | +8 |
Ex-div: 10 Mar Payment: 6 Apr *Includes intangible assets of £184m, or 208p a share | ||||
