(Alliance News) - Drug development firm Vectura Group PLC proposed a special dividend and buyback Tuesday after reporting revenue jumped on a strong inhaler performance with losses narrowing.
For the six months ended June, pretax loss improved to GBP13.2 million from GBP23.4 million the year prior. This was after revenue rose 15% to GBP91.7 million from GBP79.9 million the year before.
"Vectura has had a strong first half in 2019, with the year as a whole tracking to guidance," Vectura Interim Chief Executive Officer & Chief Financial Officer Paul Fry said.
"Following the shift in focus we announced in July, we are now executing on our strategy to build a leading inhaled contract development & manufacturing organisation business," Fry added.
Revenue performance was helped by 46% growth in product supply chain revenue from its flutiform inhaler to GBP48.4 million during the period.
"With our continued confidence in the outlook for Vectura, we have also announced today an increase in our proposed capital return to shareholders from GBP50 million to GBP60 million."
Vectura proposed a 6.0 pence per share special dividend as part of a GBP60 million capital return programme. The special payout is expected to see GBP40 million returned to investors, with the remainder to be returned through a share buyback in equal instalments during the rest of 2019 and the first six months of 2020.
"Following feedback from our major shareholders, we believe the proposal of a special dividend coupled with an on-market share buyback programme delivers the right balance of speed and efficiency, whilst providing liquidity for the stock during a period of potential uncertainty in financial market conditions", Fry explained.
In order to help offset the impact of the special dividend on the share price of Vectura, the firm also proposed a share consolidation that will see investors hold 12 shares for every 13 shares currently owned.
Shares in Vectura were 3.6% higher at 82.50 pence in London on Tuesday.
