Medtech company accelerates growth with record sales

Animalcare, the quiet success story of the region’s medtech sector, has accelerated its growth with a “very strong” performance.

The York-based veterinary medicines supplier put in place a plan in 2013 focused on product development and its people that is now delivering results ahead of expectations.

Sales in the six months to December were up 12%, to a record £7.97m, while its underlying EBITDA – a measure of operational profitability – increased by 26% to £2.12m.

“We are pleased that the business is performing so well,” said Animalcare’s chief executive Iain Menneer. “A number of the fundamental building blocks put in place over the last four years are bearing fruit; from the sales team structure, to the product development team, to our in-house product registration team, and more recently our focus on sales in Europe and the rest of the world.”

International sales are a growing part of the company’s success after it realised it hadn’t put adequate resources into overseas markets.

Martin Gore, who joined as head of international sales 18 months ago, has spearheaded this expansion, which has seen Animalcare “pick up a lot of low-hanging fruit, but also pick up up a lot of interest way beyond the European borders”, said Menneer.

Like-for-like sales growth in existing international markets was 28.5% with the remaining growth coming from sales to three new territories, including its first sales to markets in Asia.

Animalcare’s success has not gone unnoticed by investors, with its share price up 50% over the last year and trading close to its all-time high of 315p.

Chris Brewster, Animalcare’s chief financial officer, added: “One of the key reasons the share price is where it is, is because we have delivered what we have said we would.”

Analysts Panmure Gordon has repeated its buy recommendation, with a target price of 385p.

It said: “With the early January trading update having prompted us to upgrade forecasts, today’s interim results show how the group’s focus on areas such as product development and international sales are translating through to growth in both the top and bottom-line.

“The consistency of delivery is what impresses us, reflecting the maturity of the management team and the clarity of the longterm vision.”