Adjusted pre-tax profits of £28.1m at Alliance Pharma (APH) were bang in line with broker Investec’s forecast, as well as numbers already disclosed in a January pre-close trading update. That left little room for surprises on results day, particularly as the ‘international star’ product portfolio continues to perform well. Products in this portfolio have “a distinct USP”, says chief executive Peter Butterfield, as well as high margins, a range of international rights and future growth potential.
The portfolio includes products such as Kelo-cote – a scar treatment – sales of which grew by more than two-thirds last year thanks to good traction across Asia Pacific and mainland Europe. It also plays host to Nizoral, a medicated anti-dandruff shampoo, that Alliance bought from consumer healthcare giant Johnson & Johnson (US:JNJ) in June for £60m. The first product licence is expected to transfer into Alliance's ownership in the second half of 2019.
Meanwhile, the group's net debt fell from nearly 2.5 times adjusted cash profits in 2017 to a multiple of 2.3, and is expected to fall to below 1.9 times by the end of the current year. Investec expects pre-tax profits of £32.8m in 2019, giving EPS of 4.9p, compared with £28.1m and 4.4p in 2018.
| ALLIANCE PHARMA (APH) | ||||
| ORD PRICE: | 66p | MARKET VALUE: | £341m | |
| TOUCH: | 66-67p | 12-MONTH HIGH: | 103p | LOW: 59p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 49p* | NET DEBT: | 34% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 43.5 | 10.2 | 3.2 | 1.0 |
| 2015 | 48.3 | 15.2 | 4.7 | 1.1 |
| 2016 | 97.5 | 22.2 | 3.9 | 1.2 |
| 2017 | 102 | 28.3 | 6.1 | 1.3 |
| 2018 | 118 | 22.8 | 3.7 | 1.5 |
| % change | +16 | -19 | -39 | +13 |
| Ex-div: | 13 Jun | |||
| Payment: | 11 Jul | |||
| *Includes intangible assets of £335m, or 65p a share | ||||
