International issues fail to dampen Dechra’s optimistic outlook

PET pharmaceuticals firm Dechra has reported solid if unspectacular trading performance in a statement issued this morning to the London Stock Exchange.

The Staffordshire-based group’s update ahead of its financial results for the period ended December 31, states revenue is up by approximately 4% on the equivalent period last year.

It said performance has been “resilient” in key European markets despite under-performance in the Netherlands and the impact of phasing of export orders.

The statement said strong growth of key products in the US was masked by previously announced Animax supply issues.
 
In the first half, its European pharmaceuticals segment increased revenues by approximately 5%, it said.

“Despite the continuing challenging market conditions in Europe, trading within our own sales and marketing organisations delivered a resilient performance, with the exception of the Netherlands where sales have been affected by a reduction in antimicrobial usage (compared to the same period last year) and increased competitive pressure,” it said. 

“Export revenues remain lower than in the prior year due to the phasing of our order book.  Pressure on the food producing animal products (FAP) portfolio remains as veterinarians continue to reduce their antimicrobial usage, however our companion animal products (CAP) business has shown growth in the majority of markets. As a result, gross margins have benefited from this change in product mix.”
 
Total reported US revenue has declined approximately 2% on the first half last year, Dechra reports.

It said key dermatology and endocrinology products performed strongly in the first half with revenues growing by approximately 12%.
 
Dechra said its anticipated operating profit for the six-month period ended December 31 is in line with management expectations and it suggests it remains in a strong financial position to continue to deliver its strategy of building an international specialist veterinary pharmaceuticals and related products business.