Shares in international healthcare group Alliance Pharma (APH:AIM) gained 7.3% to 110.4p after it said full-year pre-tax profit to 31 December is expected to be comfortably ahead of market expectations.

A strong contribution from scarring product Kelo-Cote helped deliver 27% growth in revenues to £169.6 million, around 4% above consensus expectations according to Refinitiv data.

Kelo-Cote delivered a particularly strong performance in the Asia Pacific and Latin America regions which drove revenues 47% higher to £48.8 million, aided by new distributors and increased cross-border ecommerce activity in China.


The consumer health division delivered a 36% increase in revenues to £121.8 million and now represents around 72% of total revenues.

In the first full year under group ownership, menopause relief business Amberen delivered 3% growth in revenues to $26.5 million (around £19.2 million). Management expects growth to accelerate in 2022 following a period of investment to expand its local operating capabilities.

The prescription medicines business saw some recovery after being impacted by covid-19 restrictions, delivering revenue growth of 8% to £47.8 million.

Strong second half cash generation pushed net debt to EBITDA (earnings before interest, taxes, depreciation, and amortization) a measure of leverage to below two times in line with prior company guidance.


Pharma analyst Paul Cuddon at Numis said increased company guidance implied a ‘significant’ increase in gross margins leading to a 6% upgrade of his 2021 pre-tax profit and earnings per share forecasts to £39.6 million and 6p per share respectively.

Cuddon concluded: ‘the business is well-placed to pursue further accretive bolt-ons and remains a scarce consumer health asset with globally leading brands addressing large consumer markets.’

Alliance Pharma owns or licenses over 90 pharmaceutical and healthcare products and sells them in more than 100 countries. Unusually the company outsources all the capital-intensive activities such as manufacturing, storage and logistics.

This frees-up management to focus on the activities they believe will deliver the greatest value, such as marketing and product sourcing. Expertise in medical regulation matters are kept in-house.


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Issue Date: 18 Jan 2022