Strong trading at United Drug boosts shares

United Drug, a provider of services to healthcare manufacturers and pharmaceutical retailers, has reported strong trading since April 1st with group revenue and profits for the nine months to June 30th ahead of the same period last year.

The results were boosted by growth in its international operations, with the businesses outside of Ireland now contributing over 70% of group profits. In addition, cash generated from operations was also strong.

In the quarter to June 30th the Sales, Marketing & Medical division experienced strong trading in all areas, with the acquisition of Watermeadow proving to be a high quality acquisition. The division has yet to complete the acquisition of Pharmexx, but once it has this will establish United Drug as one of the leading international providers of contract sales outsourcing services, the firm said.

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The Healthcare Supply Chain division saw both revenue and profits ahead of the same period last year despite significant healthcare austerity measures in the UK and Ireland, where profits were slightly down.

Earnings and income were also well ahead of the same period last year in the Packing & Speciality business after it won new cutomers and despite its European packaging business still trading behind last year.

In a statement the company said: "Based on the strong trading performance for the year to date, the outlook for the remainder of the year, and stability in current exchange rates, the group now expects adjusted diluted earnings per share for the year to September 30th 2012, before one-off costs associated with current acquisition activity, to be between 8% and 10% ahead of last year.

"The group also expects to deliver another strong cash flow performance in the year. With strong cash flows and modest debt levels the group remains well positioned to support its future growth objectives both organically and through additional acquisitions."

The share price rose 6.87% to 182.75p by midday.

NR