It was a tale of two revenue streams for Alliance Pharma (APH) in the first half, with the group’s new portfolio structure outlining the diverging fortunes of its individual businesses during the pandemic.
On the one hand, consumer healthcare brands – which include Alliance’s ‘international star’ lines – slipped by just 3 per cent to £43.8m, notwithstanding the ongoing crisis. On the other, the smaller prescription medicines segment was knocked by a well-documented slowdown in routine healthcare. Sales here tumbled by 15 per cent to £21.5m.
Within the consumer division, the Kelo-cote scar treatment performed well – with revenues up by 8 per cent year on year as Chinese demand rebounded during the second quarter. Sales of Nizoral anti-dandruff shampoo were also flat year on year, and Vamousse headlice products saw revenues edge up by 4 per cent to £3.2m. That said, with many US schools not due to open until next year, Alliance believes that second-half sales here will be significantly lower.
As part of its reorganisation, Alliance has given finite ‘useful lives’ to its prescription brand assets of up to 20 years – consequently incurring amortisation charges. Combined with £12.1m in impairment charges against certain prescription medicine assets, this dealt a considerable blow to statutory earnings.
Numis expects adjusted EPS of 4.8p in 2020, rising to 5.4p in 2021.
| ALLIANCE PHARMA (APH) | ||||
| ORD PRICE: | 73p | MARKET VALUE: | £388m | |
| TOUCH: | 73.1-73.9p | 12-MONTH HIGH: | 88p | LOW: 57p |
| DIVIDEND YIELD: | 0.73% | PE RATIO: | 34 | |
| NET ASSET VALUE: | 51p* | NET DEBT**: | 19% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 66.0 | 15.2 | 2.34 | 0.54 |
| 2020 | 61.7 | 0.63 | -0.33 | 0.54 |
| % change | -7 | -96 | - | - |
| Ex-div: | 17 Dec | |||
| Payment: | 07 Jan | |||
| *Includes intangible assets of £317m, or 60p a share | ||||
