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(Alliance News) - Animalcare Group PLC on Thursday reported a significantly widened loss for 2019 but expressed confidence in its future performance after the Covid-19 crisis is over.
The stock was trading 0.3% higher at 170.55 pence each on Thursday morning in London.
For 2019, the animal health business posted revenue of GBP71.1 million, down 1.9% from GBP72.5 million in 2018. The company blamed the decline in revenue on supply challenges.
Revenue from its Companion animals unit rose 1.0% to GBP46.5 million, but was held back by supply issues with some of its contract manufacturers. This included the company's most important Companion animal product, isoflurane, for which supply interruptions reduced revenue by GBP1.5 million.
Animalcare said Production Animals revenue declined by 9.4% to GBP18.8 million primarily because of lower demand for antibiotics and distributor destocking in Spain.
Pretax loss was GBP1.6 million, widened from GBP357,000 reported for 2018. The widened loss was attributed to a rise in costs during the year. General and administrative expenses were up to GBP17.5 million from GBP16.7 million. Finance expenses were GBP1.9 million, up from GBP840,000 the year prior.
"We delivered in line with market expectations, improving cash conversion, increasing underlying EBITDA and reducing net debt despite a decline in revenues due to now-resolved product supply issues," said Chief Executive Jenny Winter.
The payment of a final dividend for 2019 was deferred to conserve cash, providing savings of around GBP1.4 million. An interim dividend of 2.0p was paid in November. For comparison, a final dividend of 2.4p was declared for 2018, taking the total annual payout to 4.4p.
Looking ahead, Animalcare said that while its performance in the first three months was strong, it expects "significant disruption" to the animal health sector with a subsequent decline in demand visible from the second quarter of 2020. However, it expressed confidence in its ability to emerge from the crisis well-placed to succeed.
"I'm confident that our agility, an intimate knowledge of our markets and a clear strategic focus - combined with our financial strength - positions us to emerge successfully from these unprecedented circumstances," said Chair Jan Boone.
As at the end of December, the company had cash of GBP6.2 million.
By Ife Taiwo; ifetaiwo@alliancenews.com
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