CVS beats revenue forecasts in first half

Veterinary services provider CVS Group beat revenue forecasts in the first half of its fiscal year, helped by acquisitions and growth in its online platform, Animed Direct.

Veterinary services provider CVS Group beat revenue forecasts in the first half of its fiscal year, helped by acquisitions and growth in its online platform, Animed Direct.

Revenue rose by 8.1% from £54m to £58.3m in the six months to December 31st, ahead of Panmure Gordon's £55.4m estimate. Like-for-like (LFL) sales increased by 4.0% in the first half.

However, this LFL growth has slowed to 3.4% in January and February due to the impact of the snow at the start of the year.

CVS said that Animed Direct continues to grow strongly and its range of pet products has been expanded. While the division mainly sells to UK customers, the company noted that a few sales have been made into Europe.

By the end of the period, the company operated 240 surgeries, up from 225 the year before, giving it an 11% share of the total UK small animal veterinary market.

Furthermore, since the end of the first half, the company acquired two further practices in Chester and Hampshire which have a combined historical revenue of £6.4m per annum.

Chief Executive Simon Innes said: "I am pleased to announce that CVS continues to deliver strong core growth, whilst adding new acquisitions to the business. Our new initiatives in the areas of loyalty schemes and online are driving our like-for-like sales growth and increasing our competitiveness and stability."

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) was up 5.2% at £8.2m, in line with forecasts, while the EBITDA margin fell from 14.4% to 14.1%, owing to competitive pressures in the laboratory business.

No interim dividend was paid, the same as last year, but the company expects another final payout to be announced with the full-year results.

Shares were up 1.77% at 189.29p in early trading on Wednesday.

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