The UK’s future relationship with the European Union (EU) is a particularly pressing matter when it comes to the movement and regulation of medicines and healthcare equipment. And it's why many companies have used interim results to outline their 'Brexit plans'. Advanced Medical Solutions (AMS) doesn’t really need one. Now that more than four-fifths of its sales are derived overseas, and its UK division has been granted Authorised Economic Operator status (meaning it won’t have to pay hefty import tariffs), it's one of the best-placed healthcare companies to deal with Britain’s extraction from the EU.
But for now, AMS’s international sales are being hurt by currency movements. In Germany, wider Europe and the US – its three largest geographical subsidiaries – revenues fell on a reported basis, while UK sales rose 18 per cent to £9.2m. The loss of one of the group’s US partners also sent revenues in the original equipment manufacturing business down 6 per cent to £17.6m.
Still, the group managed to report a 19 per cent increase in adjusted pre-tax profits as soaring revenues from the higher-margin, branded division sent gross margins up 3 percentage points to 63 per cent. Broker Panmure Gordon has maintained annual pre-tax profits and EPS forecasts of £27.8m and 10.4p respectively (up from £25.4m and 9.6p in 2017).
| ADVANCED MEDICAL SOLUTIONS (AMS) | ||||
| ORD PRICE: | 325p | MARKET VALUE: | £694m | |
| TOUCH: | 324.5-325p | 12-MONTH HIGH / LOW: | 374p | 281p |
| DIVIDEND YIELD: | 0.4% | PE RATIO: | 32 | |
| NET ASSET VALUE: | 76p* | NET CASH: | £71.1m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 46.1 | 11.4 | 4.32 | 0.35 |
| 2018 | 47.6 | 13.6 | 5.06 | 0.42 |
| % change | +3 | +19 | +17 | +20 |
| Ex-div: | 27 Sep | |||
| Payment: | 26 Oct | |||
| *Includes intangible assets of £41.7m, or 19.6p a share | ||||
