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This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.
For immediate release | 29 January 2024 |
ALLIANCE PHARMA
("Alliance", "Company" or the "Group")
Full Year Trading Update
Strong revenues on H2 recovery, leverage reduced
Alliance Pharma plc (AIM: APH), the international healthcare group, announces its trading update for the year ended 31 December 2023 (the "Period"), ahead of the announcement of the Group's audited results in March 2024, which are anticipated to be in line with market expectations.
Financial summary
The Group delivered record see-through1 revenues in the Period of £182.7m (FY22: £172.0m), up 6% versus the prior period and up 7% at constant exchange rates ("CER"). Excluding sales from ScarAway and the US rights to Kelo-Cote in Q1 23, both acquired in March 2022 (the "US Acquisition"), like-for-like see-through revenues increased 6% CER.
Continued strong consumer demand, particularly in China, drove significant recovery in Kelo-Cote franchise revenues in H2, leading to FY23 revenues of £63.2m, up 29% CER (FY22: £50.0m). Nizoral revenues increased 3% CER to £21.7m (FY22: £21.8m) whilst Amberen revenues declined 6% CER on an underlying basis (excluding the leading discount store account that was lost in 2022) and decreased 25% CER to £11.2m (FY22: £14.9m) on a reported basis. With Other Consumer brands up 5% CER to £40.3m (FY22: £38.4m), total see-through Consumer Healthcare revenues increased 11% CER to £136.4m. Prescription Medicine revenues were stable at £46.3m (FY22: £46.8m), reflecting a strong recovery in H2 as expected, as previously out of stock products became available.
Underlying profit for the Period is anticipated to be in-line with market expectations.
Cash and debt
Free cash flow in the Period rose 34% to £21.1m (FY22: £15.8m) and net debt reduction continued, falling to £92.4m at 31 December 2023 (31 December 2022: £102.0m). Group leverage2 (as at 31 December 2023) is expected to be significantly below that at 30 June 2023 (2.7x), and in-line with previous guidance.
Outlook
Demand for the Group's brands remains strong. Alliance's clear focus on the core Consumer Healthcare business, in addition to our well-established, scalable platform across EMEA, APAC and the US, is expected to deliver continued strong organic growth over the medium term. In 2024, the Board anticipates our Consumer Healthcare revenues to continue to grow above that of the broader Consumer Healthcare market, with stable Prescription Medicine revenues.
In order to achieve our medium-term objectives, in 2024, the Board anticipates increased investment in sales and marketing, both directly and through the Group's distributors. The Company will also continue to deliver innovation in 2024 to further expand the reach of its brands. As a result, the Board anticipates that profits in 2024 will be in-line with 2023.
Peter Butterfield, Chief Executive Officer of Alliance, commented:
"Our portfolio continues to provide a robust platform from which to grow our Consumer Healthcare brands. In 2023, we delivered record revenues as we launched new advertising campaigns to accelerate organic sales growth whilst bringing new, innovative, products to market. Our global ecommerce business is building strongly, as we entered several new, high growth geographies in 2023, and look to enter more this year.
"We remain confident in our long-term performance as we focus our resources on those market segments in which we already have a strong presence and expertise in order to drive solid organic revenue growth above that of the broader Consumer Healthcare market."
1 See-through revenue includes sales from Nizoral? as if they had been invoiced by Alliance as principal. For statutory accounting purposes the product margin relating to Nizoral sales made on an agency basis is included within Revenue, in line with IFRS 15.
2 Adjusted net debt / enlarged Group EBITDA, calculated using pro forma EBITDA on a trailing 12-month basis.
For further information:
Alliance Pharma plc | + 44 (0)1249 466966 |
Cora McCallum, Head of Investor Relations & Corporate Communications | + 44 (0)1249 705168 |
ir@allianceph.com |
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Buchanan | + 44 (0)20 7466 5000 |
Mark Court / Sophie Wills |
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alliancepharma@buchanan.uk.com |
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Deutsche Numis (Nominated Adviser and Joint Broker) | + 44 (0)20 7260 1000 |
Freddie Barnfield / Duncan Monteith / Sher Shah |
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Investec Bank plc (Joint Broker) | + 44 (0)20 7597 5970 |
Patrick Robb / Maria Gomez de Olea |
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About Alliance
Alliance Pharma plc (AIM: APH) is a growing consumer healthcare company. Our purpose is to empower people to make a positive difference to their health and wellbeing by making our trusted and proven brands available around the world.
We deliver organic growth through investing in our priority brands and channels, in related innovation, and through selective geographic expansion to increase the reach of our brands. Periodically, we may look to enhance our organic growth through selective, complementary acquisitions.
Headquartered in the UK, the Group employs around 285 people based in locations across Europe, North America, and the Asia Pacific region. By outsourcing our manufacturing and logistics we remain asset-light and focused on maximising the value we can bring, both to our stakeholders and to our brands.
For more information on Alliance, please visit our website: www.alliancepharmaceuticals.com