Specialist pharma services company Clinigen (CLIN:AIM) reported full-year gross profits in-line with the July trading statement, up 30% to £182.3m. The market pushed the shares up 1.25% to 894.5p.

The company released its first formal five-year guidance for expected growth in annual organic gross profits of 5% to 10%.

Chief executive Shaun Chilton said ‘we have continued our run of double digit EPS growth each year and 22% CAGR overall since the IPO. We have grown through a combination of transformative acquisitions and organic growth to create an international platform which is now taking shape and supporting synergistic growth. This year’s performance reflects the results of this strategy.’

Clinigen is focused on providing ethical access to unlicensed and hard to source medicines by partnering with leading biotech and pharma clients and hospitals dealing with secondary care for rare diseases.

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In-line with the company’s strategy to grow by acquisition it added two businesses, CSM and iQone and two new products, Imukin and Proleukin, the latter is expected to be earnings enhancing in the coming financial year.

Trading in the current financial year has been strong and the company remains in a good position to drive further growth all parts of the business.

Management believes growth that growth in earnings before interest, tax, depreciation and amortisation (EBITDA) will outstrip gross profits growth as operational leverage benefits kick-in, especially beyond 2020.

Adjusted EPS increased by 20% to 54.4p (45.4p) reflecting higher operating profits offset by dilution and higher finance costs related to the acquisitions. The directors are proposing a final dividend of 4.75p, resulting in a 20% increase in the full year to 6.7p.

At the year-end net debt to EBITDA was 1.99 times, comfortably under the bank covenant ceiling of three-times. The company is strongly cash-generative and produced £89.8m of operating cash, up 40% on last year.

In addition to re-investing in the business and making acquisitions, the company plans to pay-down and maintain net debt in a range of 1 times to two times EBITDA while progressively increasing the dividend.

 

 

 

 

 

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Issue Date: 19 Sep 2019