Shares in healthcare products firm Maelor rose after it flagged better than expected full year results. It also announced the acquisition of pharmaceuticals and medical devices group Acorus for £13m.
In an update for its full year to 31 March, Maelor says the good trading
highlighted at the time of its interim results in early May continued
into the last quarter. As a result it anticipates a significant
reduction in losses for the second half of the year.
Pretax losses for the first six months to end September narrowed to
£74,941 from £407,266 on sales up a hefty 44% to £1.33m. Interim
operating losses reduced to £93,000 from £429,000.
Encouragingly, sales growth of its key Volplex plasma substitute
product, the commercialisation of which has been taken in-house, has
continued, driven by promotional activity and successful tendering for
regional contracts. Sales of catheter flushing devices also continue to
progress well.
The group continues to expand its portfolio of specialist healthcare
products. Recent additions include AquiHex, developed in-house for use
in hospital infection control. Late stage development of ISOplex,
another novel plasma, remains on track with approval still targeted for
late 2008.
Maelor chief executive Tim Wright says management is 'very pleased' with
the progress since a strategic review in June 2006. There was a big
shakeup of top management in the run up to the review, including the
appointment of Wright as chief executive in September 2005. Since then a
new chairman and finance director have also been appointed.
Wright adds: 'In line with our new strategy the business is now focused,
stabilised and well positioned for rapid organic and acquisitive
growth.' He says the acquisition of Acorus represents a further step in
the group's strategy to establish a significant business in hospital
specialist medicine.
The £13m acquisition of Acorus is being partly funded by a placing of
80m shares at 10p with institutions. Under the terms of the deal, Maelor
will pay £7m in cash and £1m in paper. There is also a £5m deferred
consideration payable over five years, funded from ongoing cash flow,
based on sales targets.
Acorus is expected to be immediately earnings enhancing. For its year to
30 September 2006 it reported turnover of £3.04m versus £1.59m last
time. Gross profit rose to £2.13m from £1.1m in 2005, with profits after
tax increased to £620,000 from £40,000.
Acorus brings with a portfolio that includes Mysoline, a long
established treatment for epilepsy that boasts stable sales performance
since epilepsy sufferers once controlled are unlikely to be changed to
different medications. There is also Gentispray, a spray treatment in
late stage (phase III) development for the treatment of outer ear
infections. The product combines the most commonly used formulation of
eardrops, in a popular ear spray delivery format.
The upbeat trading update, growing confidence in the new management and
its ability to deliver, alongside the news of what looks like an astute
acquisition helped Maelor Plc shares advance 11.8% or 1.5p to 14.25p,
valuing the company at £4.9m.
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Maelor upbeat after £13m acquistion
Kam Patel, 05/04/07 09:20
Shares in healthcare products firm Maelor rose after it flagged better than expected full year results. It also announced the acquisition of pharmaceuticals and medical devices group Acorus for £13m.
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In an update for its full year to 31 March, Maelor says the good trading highlighted at the time of its interim results in early May continued into the last quarter. As a result it anticipates a significant reduction in losses for the second half of the year.
Pretax losses for the first six months to end September narrowed to £74,941 from £407,266 on sales up a hefty 44% to £1.33m. Interim operating losses reduced to £93,000 from £429,000.
Encouragingly, sales growth of its key Volplex plasma substitute product, the commercialisation of which has been taken in-house, has continued, driven by promotional activity and successful tendering for regional contracts. Sales of catheter flushing devices also continue to progress well.
The group continues to expand its portfolio of specialist healthcare products. Recent additions include AquiHex, developed in-house for use in hospital infection control. Late stage development of ISOplex, another novel plasma, remains on track with approval still targeted for late 2008.
Maelor chief executive Tim Wright says management is 'very pleased' with the progress since a strategic review in June 2006. There was a big shakeup of top management in the run up to the review, including the appointment of Wright as chief executive in September 2005. Since then a new chairman and finance director have also been appointed.
Wright adds: 'In line with our new strategy the business is now focused, stabilised and well positioned for rapid organic and acquisitive growth.' He says the acquisition of Acorus represents a further step in the group's strategy to establish a significant business in hospital specialist medicine.
The £13m acquisition of Acorus is being partly funded by a placing of 80m shares at 10p with institutions. Under the terms of the deal, Maelor will pay £7m in cash and £1m in paper. There is also a £5m deferred consideration payable over five years, funded from ongoing cash flow, based on sales targets.
Acorus is expected to be immediately earnings enhancing. For its year to 30 September 2006 it reported turnover of £3.04m versus £1.59m last time. Gross profit rose to £2.13m from £1.1m in 2005, with profits after tax increased to £620,000 from £40,000.
Acorus brings with a portfolio that includes Mysoline, a long established treatment for epilepsy that boasts stable sales performance since epilepsy sufferers once controlled are unlikely to be changed to different medications. There is also Gentispray, a spray treatment in late stage (phase III) development for the treatment of outer ear infections. The product combines the most commonly used formulation of eardrops, in a popular ear spray delivery format.
The upbeat trading update, growing confidence in the new management and its ability to deliver, alongside the news of what looks like an astute acquisition helped Maelor Plc shares advance 11.8% or 1.5p to 14.25p, valuing the company at £4.9m.
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