Dechra Pharmaceuticals PLC - 20 Years of Strategic Growth

LONDON, September 4, 2017 /PRNewswire/ --

International veterinary pharmaceutical business, Dechra Pharmaceuticals PLC (LSE Main Listing: Symbol DPH) releases its audited preliminary results for the year ended 30 June 2017:

Dechra's CEO Ian Page commented:

"As we complete our 20th year since the inception of the Company, we are pleased to report that the Group has delivered another strong financial performance. This has been driven by growth from our existing portfolio, good market penetration from recent pipeline launches and the pleasing performance of the acquisitions made in the preceding financial year. This has resulted in strong cash generation and deleveraging of our balance sheet. Furthermore, we have completed two acquisitions within the 2017 financial year, the first of which extends our geographical footprint into Australia and New Zealand and the second is a minority stake together with the global marketing rights in a business that may transform our Food producing Animal Product (FAP) business in the long term through the development of a novel approach to farm animal pain relief.  

   
Highlights

- Strategic progress made:

  · Core portfolio growth solid in EU, excellent in NA; major therapeutic sectors
    continue to grow.

  · Strong performance from prior year acquisitions.

  · Apex (Australia) completed and integrated, and 33.0% share of Medical Ethics Pty Ltd
    acquired.

  · New geographic territories performing well; new Dechra Veterinary Products
    International team to create greater focus.

  · Significant pipeline delivery with two new FAP EU registrations and numerous
    international approvals.

  · Exploring several new pipeline opportunities.

- Strong financial performance:

  · Strong revenue growth of 28.3% at constant exchange rates (CER).

  · Solid revenue growth in Companion Animal Products (CAP), Food producing Animal Products (FAP), and Equine.
                                                            
   · 36.9% growth at CER in underlying operating profit.

  · Strong operational leverage and full year synergies from acquisitions lifts EBIT margin 140 bps to 22.6%.
                                                                 
   · Consistently strong cash conversion of 115.9%, driving Net Debt / underlying EBITDA leverage down from 2.0 to 1.4 times.
                                                     
   · Underlying diluted EPS growth of 35.1%; increase in full year dividend to 21.44 pence.
                                                                                   

Financial Summary 

   
                                      2017       2016

    Underlying                        GBPm       GBPm      Growth at AER    Growth at CER
    Revenue                          359.3      247.6         45.1%           28.3%
    Underlying Operating profit       81.3       52.9         53.7%           36.9%

    Underlying EBIT %                22.6%      21.4%        120bps          140bps

    Underlying profit before
    tax                               77.0       49.7         54.9%           38.4%
    Underlying EBITDA                 88.2       58.0         52.1%           35.5%
    Net cash generated from
    operations                        94.3       56.5         66.9%             -
    Underlying diluted EPS (p)       64.33      42.65         50.8%           35.1%
    Dividend per Share               21.44      18.46         16.1%           16.1%

Underlying results excludes amortisation of acquired intangibles and impairment of acquired intangibles, impairment of investments, acquisition expenses, fair value uplift of inventory acquired through business combinations, rationalisation costs, loss on extinguishment of debt, and fair value and other movements on deferred and contingent consideration

Richard Cotton, CFO, Dechra Pharmaceuticals PLC, added:

"Dechra has delivered a strong set of financial results in the year with a good performance from both its existing and acquisition businesses.  Revenue growth has converted strongly to increased operating profit and EPS, up 36.9% and 35.1% respectively on an underlying basis. 

The strong financial disciplines have been maintained in a period of significant change both internally and in the wider economy, with a strong results orientation and focus on sales and margin development. 

We have also continued our balance sheet discipline, delivering a reduction in our net debt leverage from 2.0 times to 1.4 times through our strong cash conversion of 115.9% and prudent approach to financing our investments and acquisitions.  

Our investments in the existing business and in acquisitions position Dechra strongly for ongoing organic growth and expansion, and the continued creation of shareholder value." 

Dividend 

The Board is proposing a final dividend of 15.33 pence per share (2016: 12.91 pence per share).  Added to the interim dividend of 6.11 pence per share, this brings the total dividend for the financial year ended 30 June 2017 to 21.44 pence per share, representing 16.1% growth over the previous year.  Subject to shareholder approval at the Annual General Meeting to be held on 20 October 2017, the final dividend will be paid on 17 November 2017 to shareholders on the Register at 27 October 2017. The shares will become ex-dividend on 26 October 2017.

Outlook 

As outlined in the full statement available to read at http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/DPH/13349979.html or at http://www.dechra.com the core business and acquisitions are performing well. The enlarged Group continues to outperform the majority of markets in which we trade and we continue to identify new growth opportunities and operational efficiencies.  Current trading is in line with the Board expectations and we anticipate delivering our strategic objectives in the new financial year.

About Dechra
Dechra is an international specialist veterinary pharmaceuticals and related products business. Its expertise is in the development, manufacture and sales and marketing of high quality products exclusively for veterinarians worldwide. Dechra's business is unique as the majority of its products are used to treat medical conditions for which, there are no other effective solution or have a clinical or dosing advantage over competitor products. For more information, please visit: http://www.dechra.com

Stock Code: Full Listing (Pharmaceuticals): DPH

Trademarks

Trademarks appear throughout this document in italics. Dechra and the Dechra 'D' logo are registered Trademarks of Dechra Pharmaceuticals PLC. The Malaseb Trademark is used under licence from Dermcare-Vet Pty. Ltd