19th Sep 2014 10:10
LONDON (Alliance News) - Veterinary services provider CVS Group PLC Friday posted strong revenue and profit growth in its last financial year, prompting the company to raised its dividend by 25%.
The company said a strong performance across the business drove a 15% increase in its pretax profit for the year ended June 30 to GBP6.3 million, compared with GBP5.5 million a year earlier, as revenue grew by 19% to GBP142.9 million, up from GBP120.1 million the prior year. Like-for-like sales for the group were up 6.9%.
CVS gave a confident outlook, citing signs of a return to more favourable market conditions. It said it expects further growth in all its divisions in the current financial year.
"All divisions delivered good organic growth and this was enhanced by further acquisitions in our Veterinary Practice and Crematoria Divisions. We continued to invest in the development of our services, our staff and our premises, providing improved customer service," said Non-Executive Chairman Richard Connell in a statement.
CVS declared a 25% increase in its dividend for the year to 2.5 pence from 2.0p.
"With a strong pipeline of acquisitions, as well as significant opportunities for organic growth, the board believes that shareholder value can best be grown by reinvesting the majority of operational cash flow back into the business. However, the increased scale and growth of our business can also support a meaningful increase in the level of dividend," said Connell.
The veterinary services company said revenue growth had been driven by good weather during the winter months, and sales were strong in all of its main businesses, particularly Animed Direct.
Animed, an online dispensary, delivered a 74% increase in revenue during the year.
Memberships for its Health Pet Club loyalty schemes rose 45% to 162,000 pets
The group continues to invest in acquisitions. During the year just ended, it spent GBP12.4 million to acquire 18 surgeries, through the acquisition of 10 practices, and its third crematorium. Since year end it has acquired three surgeries in Edinburgh and two surgeries in Ipswich.
It said an increase in scale will allow it to fund more acquisitions in future years.
"The board is optimistic about the group's future. It estimates that CVS only has an 11% share of the UK small animal veterinary market and a negligible share of the equine and large animal veterinary market. This demonstrates the major opportunity for further growth and consolidation and we expect to make further practice acquisitions," said Connell.
CVS shares were trading 3.2% higher Friday morning at 357.00 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
CVS Group