Clinigen (CLIN) chief executive Peter George has called the first half "a period of transformation", referring to the expansion of the group following two major acquisitions in April and October. The group benefited from £32m of revenue from the two acquisitions, helping increase gross profits by 82 per cent to £40.2m. But extra costs weighed on pre-tax profits.
However, the strategic acquisitions helped the group form a better mix of services and products, reducing its reliance on the lumpy clinical trials business, which previously concerned shareholders.
Organic growth in the first half was driven by the group's speciality pharma business, which buys badly managed drugs from big pharmaceutical companies and gives them a new lease of life. Three of these drugs performed particularly well in the period, resulting in a 12 per cent increase in gross profit in the division. Clinigen recently purchased another speciality drug, Totect, announced alongside the results, which it hopes will further enhance growth in this part of the business.
Broker Stifel expects adjusted EPS of 36p for the financial year to June 2016, up from 28p in FY2015.
CLINIGEN GROUP (CLIN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 637p | MARKET VALUE: | £730m | |
| TOUCH: | 634p-637p | 12-MONTH HIGH: | 774p | LOW: 495p |
| DIVIDEND YIELD: | 0.6% | PE RATIO: | na | |
| NET ASSET VALUE: | 204p | NET DEBT: | 36% | |
| Half-year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 72.6 | 9.9 | 9.2 | 1.1 |
| 2015 | 156 | 2.2 | 1.4 | 1.3 |
| % change | +115 | -78 | -85 | +18 |
Ex-div: 17 Mar Payment: 8 Apr *Includes intangible assets of £338m, or 295p a share | ||||
