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Alliance Pharma trades strongly in first half

By Josh White

Date: Tuesday 21 Sep 2021

Alliance Pharma trades strongly in first half

(Sharecast News) - Healthcare company Alliance Pharma reported strong trading in its first half on Tuesday, reporting a 24% rise in see-through revenue to £80.9m.
The AIM-traded firm said like-for-like see-through revenue, which excludes Amberen, was up 9%, and statutory revenue rose 27% year-on-year to £78.6m for the six months ended 30 June.

Strong performance was reported from the company's consumer healthcare brands, with see-through revenue there up 30% overall, with 'Kelo-cote' revenue ahead 54%, while like-for-like consumer healthcare revenue rose 8%.

Prescription medicines revenue, meanwhile, was 12% firmer for the period.

Alliance's underlying gross margin was up 4.7 percentage points to 63.8% of see-through revenue, which the board said reflected "favourable changes" in its product mix, while its statutory gross margin improved 3.1 points to 65.6%.

Underlying profit before tax rose 24% to £20.1m, with reported profit before tax coming in at £16.5m, compared to £0.6m a year earlier.

Free cash flow totalled £6.5m, down from £10.5m year-on-year, which the board said reflected the expected reversal of favourable working capital movements in the fourth quarter of 2020, and the timing of sales within the period.

Leverage reduced to 2.21x from 2.43x at the end of December, and was expected to fall below 2x by the end of the year.

The company said the integration of Amberen was complete, and trading in line with management expectations.

Its board declared an interim dividend of 0.563p, up 5% over the half-year distribution in 2020.

"The group has delivered another strong performance in the first half of 2021, with the uplift in revenue from our enlarged consumer healthcare business flowing through to pre-tax profits," said chief executive officer Peter Butterfield.

"We expect this core part of our business to continue to grow strongly during the remainder of the year, led by Kelo-cote and Amberen.

"We were very pleased with the first half performance from Amberen, which was acquired in December and has traded in line with our expectations."

Butterfield said that, with the integration of the brand into the firm's US-based operations now complete, it could focus on maximising its value.

"Trading for the remainder of the financial year remains in line with market expectations.

"We expect the combination of positive trading and working capital movements to result in group leverage falling below 2x by the end of the year."

At 1047 BST, shares in Alliance Pharma were up 3.96% at 105p.


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