Interim results from Allergy Therapeutics (AGY) sent the group's shares up 14 per cent in one day. Although management had previously announced better-than-expected growth, it's not surprising shareholders responded so well: a fourfold increase in pre-tax profits on an 18 per cent increase in constant currency revenue is something to celebrate.
Top-line growth was driven by the Pollinex franchise of allergy medicines. The group gained another percentage point of share in the European market, and chief executive Manuel Llobet thinks another percentage point could be added in the next six months, taking the group's market share to 14 per cent.
Allergy Therapeutics has also started recruiting for a final European trial into its novel Pollinex Quattro birch allergy medicine. This trial should be complete by summer 2018 and is fully funded by the group's own cash reserves. The future pipeline, which includes a novel peanut allergy vaccine, is also being internally funded by Allergy's commercial arm, which generated £5.3m of cash from operating activities in the first half.
But broker FinnCap expects Allergy still to be lossmaking for the year ending June 2017. That's because the seasonal nature of allergy products means over 60 per cent of revenues are booked in the first half. FinnCap has forecast pre-tax losses of £3.2m and an adjusted loss per share of 0.7p (FY2016: -£11.7m and -2.2p).
ALLERGY THERAPEUTICS (AGY) | ||||
|---|---|---|---|---|
| ORD PRICE: | 26.5p | MARKET VALUE: | £157m | |
| TOUCH: | 26-27p | 12-MONTH HIGH: | 29p | LOW: 17p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 6.5p* | NET CASH: | £27.8m | |
| Half-year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 21.6 | 1.3 | 0.2 | nil |
| 2016 | 31.5 | 7.2 | 1.2 | nil |
| % change | +46 | +453 | +511 | - |
Ex-div: na Payment: na *Includes intangible assets of £5.4m, or 0.9p a share | ||||
