8 Aug 2018 07:00
UDG HEALTHCARE PLC
THIRD QUARTER TRADING UPDATE
8 August 2018
UDG Healthcare plc ("the Group"), a leading international provider of healthcare services, issues the following trading update covering the period from 1 April 2018 to 30 June 2018.
Quarter to 30 June 2018
Group trading performance for the quarter to 30 June 2018 was ahead of the same quarter last year. Strong contributions from acquisitions and good underlying growth from Ashfield Communications & Advisory and Sharp more than offset a lower contribution from Ashfield Commercial & Clinical and Aquilant.
Ashfield
Ashfield Communications & Advisory performed strongly in the quarter due to a combination of good underlying growth and the benefit of acquisitions.
Ashfield Commercial & Clinical experienced a challenging quarter with operating profit well below the same quarter last year due to the phasing of contracts and fewer new business development opportunities.
Overall, trading in Ashfield was ahead of the same quarter last year.
In July 2018, the Group announced the acquisitions of Create NYC, an innovative communications agency and SmartAnalyst, a strategic commercialisation consulting and analytics business for a combined consideration of up to $82.4 million.
Sharp
Sharp delivered double digit operating profit growth ahead of the same quarter last year. This was driven by a strong performance in Sharp US, offset by a slower than anticipated ramp-up in activity levels in Sharp Europe.
Aquilant
Trading was well behind the same quarter last year due to the previously announced exit of contracts with VSI and Link.
Nine months to 30 June 2018
Group revenue and profit before tax* for the nine months to 30 June 2018 was well ahead of the prior year, primarily driven by the benefit of acquisitions completed in 2017.
Aquilant Disposal
As separately announced today, the Group has completed the disposal of Aquilant for a total potential net consideration of up to €23 million (approximately $27 million) to H2 Equity Partners. Aquilant represented approximately 4% of the Group's operating profits in the six month period ended 31 March 2018. Proceeds from the transaction will be used to fund the continued development of the Group's higher growth and higher margin divisions, Ashfield and Sharp.
Board Appointment & Management Changes
In July 2018, the Board announced the appointment of Mr. Erik Van Snippenberg as a Non-Executive Director of the Group with effect from 2 July 2018. Erik spent almost thirty years at GSK where he held a number of senior executive roles.
As previously announced, Chris Corbin retired as Executive Chairman of Ashfield on 30 June 2018. However, he has agreed to continue on the Board in a Non-Executive Director capacity, subject to re-election at the Group's Annual General Meeting.
In recognition of the fact Ashfield now represents over two thirds of the Group's profits and following the completion of seven Ashfield acquisitions over the last two years, the Group is undertaking a review of the Ashfield business structure. In consequence and as previously announced, Rob Wood will head up Ashfield Advisory, Doug Burcin will lead Ashfield Communications and Julian Tompkins will head up Ashfield Commercial & Clinical. All three leaders will report directly to UDG Healthcare Group CEO, Brendan McAtamney. As a result, Jez Moulding has decided to seek opportunities externally and will leave the Group at the end of the current financial year.
Group Outlook
The Group's balance sheet remains strong leaving it with significant capacity to execute further strategic acquisitions to complement its existing growth platforms.
The Group reiterates its full year guidance for constant currency adjusted diluted earnings per share (EPS) growth for the year to 30 September 2018 to be between 18% and 21% ahead of last year's EPS of 37.1 $ cent.
The average FY17 exchange rates were US$1 = £0.7891 and €0.9047. Based on the current prevailing exchange rates, the Group is likely to have a modest foreign exchange benefit on the translation of non-US profits in FY18.
Date for Preliminary Results
The Group expects to issue its preliminary results for the twelve months to 30 September 2018 on Tuesday 27 November 2018.
Conference Call
UDG Healthcare plc will host a conference call for investors and analysts at 9am (BST) today, Wednesday 8 August to discuss this statement. The dial-in details are as follows:
Standard International Access: +44 (0) 203 936 1888
UK Toll Free: 0203 936 1888
Ireland local: 0 155 30187
USA local: 1 646 968 0351
Room number: 985391
Participant PIN: 8469
A playback facility will be available for seven days on 0203 936 1888. The access code for the replay will be 517509
* Before the amortisation of acquired intangible assets, transaction costs and exceptional items
Forward looking Statements
This announcement contains certain forward-looking statements, beliefs or opinions, including statements with respect to the Company's business, financial condition and results of operations. By their nature these statements involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. These statements reflect the reasonable beliefs and expectations of the Company, are made in good faith and are based on the information available to the Company at the date of this announcement. However, a number of factors, including known and unknown risks, uncertainties and other factors, which are in some cases beyond the Company's control, could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements.
For reference:
Investors and Analysts:
Keith Byrne
Head of Investor Relations, Strategy & Corporate Communications
UDG Healthcare plc
Tel: + 353-1-468-9000
Media:
Lisa Kavanagh / Jack Hickey
Powerscourt
Tel: +44-207-250-1446
About UDG Healthcare plc:
UDG Healthcare plc (LON: UDG) is a leading international partner of choice delivering advisory, communication, commercial, clinical and packaging services to the healthcare industry, employing over 8,500 people with operations in 25 countries and delivering services in over 50 countries.
UDG Healthcare plc operates across two divisions: Ashfield and Sharp.
Ashfield is a global leader in advisory, communication, commercial and clinical services for the pharmaceutical and healthcare industries.
It focuses on supporting healthcare professionals and patients at all stages of the product life cycle. The division provides field and contact centre sales teams, healthcare communications, patient support, audit, advisory, medical information and event management services to over 300 healthcare companies.
Sharp is a global leader in contract commercial packaging and clinical trial packaging services for the pharmaceutical and healthcare industries, operating from state-of-the-art facilities in the US and Europe.
The company is listed on the London Stock Exchange and is a constituent of the FTSE 250.
For more information, please go to: www.udghealthcare.com