Interim Results

RNS Number : 4699Y

Alliance Pharma PLC

09 September 2015

 



For immediate release

9 September 2015

 

ALLIANCE PHARMA PLC

("Alliance" or the "Company")

Interim Results for the six months ended 30 June 2015

Alliance Pharma plc (AIM: APH), the speciality pharmaceutical company, is pleased to announce its interim results for the six months ended 30 June 2015.

Highlights:

·      Half year revenue of £22.8m (H1 2014: £21.4m)

o Year on year revenue growth of 6.5%

·      Hydromol^TM continues to grow well, with sales up 11% to £3.3m (H1 2014: £3.0m)

·      Acquisition of MacuShield^TM in February 2015 contributing sales of £1.4m

·      Half year profit before tax £5.5m (H1 2014: £5.4m)

·      Basic earnings per share 1.65p (H1 2014: 1.68p)

·      Interim dividend up 10% to 0.366p (H1 2014: 0.333p)

·      Net bank debt £26.5m (31 December 2014: £21.1m)

o  £5.5m was drawn down in the first half to fund the MacuShield acquisition

·      Licensing agreement signed with Duchesnay Inc in January 2015 for the product Diclectin

Commenting on the results, Andrew Smith, Alliance Pharma's Chairman, said:

"Alliance has made a positive start to 2015 with growth in both revenue and profits.  We see good growth potential from MacuShield, Hydromol and other key products in our portfolio, and also from potential acquisitions. With some £18m of our acquisition bank facility still undrawn we have ample headroom for deals and are seeing an attractive pipeline of opportunities. Current trading is in line with management forecasts and we expect full year results to be in line with market expectations."

For further information:

Alliance Pharma plc	+ 44 (0) 1249 466966
John Dawson, Chief Executive
Buchanan	+ 44 (0) 20 7466 5000
Mark Court / Sophie Cowles / Jane Glover
Numis Securities Limited	+ 44 (0) 20 7260 1000
Nominated Adviser: Michael Meade / Freddie Barnfield
Corporate Broking: David Poutney

Notes to editors:

About Alliance

Alliance, founded in 1998, is an AIM listed speciality pharmaceutical company based in Chippenham, Wiltshire, UK. The Company has a strong track record of acquiring the rights to established niche products and owns or licenses the rights to more than 60 pharmaceutical products and continues to explore opportunities to expand the range.

Alliance joined the AIM market of the London Stock Exchange in December 2003 and trades under the symbol APH.

Chairman's and Chief Executive's Statement

It is pleasing to report that Alliance has returned to growth this year as expected. First-half sales and profits have benefited from the February acquisition of MacuShield, as well as the continuing success of our dermatology range. In the second half we can look forward to further progress, aided by continued growth in major products and the renewed availability of our ImmuCyst^TM bladder cancer treatment.

Trading performance

Excluding our share of joint ventures, first-half sales totalled £22.8m (H1 2014: £21.4m). This 6.5% increase was achieved despite the hand-back in 2014 of nine products, which we had been distributing for Novartis since 1998. These products contributed £959,000 to first-half sales last year, although their profit contribution was relatively modest.

The loss of these sales was more than offset by MacuShield, which brought in just over £1.4m of sales in less than five months following the completion of the acquisition in early February.

Further significant growth came from our Hydromol dermatology range, up 11% to £3.3m, and Gelclair^TM, our treatment for oral mucositis, up 8% on modest promotional support.

Sales of Ashton & Parsons Infants' Powders^TM rose sharply last year as we overcame earlier production constraints. Sales in the first half of 2015 were £717,000, which represents a 19% increase on the second half of 2014 and is similar to that achieved in the first half of 2014, when sales benefited from the build-up of stocks by distributors and retailers.

Our TV advertising tests have proved encouraging, and research shows that Ashton & Parsons is achieving higher repeat sales than any other teething product. However, before increasing our investment in promoting the brand we intend to ensure that it is sufficiently available across retail outlets to satisfy the resulting uplift in awareness and demand. We are therefore giving priority to widening distribution of this resurgent brand.

We are also preparing to put increased backing in 2016 behind Lypsyl^TM, a somewhat neglected brand prior to its acquisition by Alliance. In the meantime it has been delivering useful growth - up 6% to £523,000 (H1 2014: £492,000).

Anbesol^TM has had a particularly strong six months, with sales growing by 33% to £784,000 this year (H1 2014: £591,000). We believe a principal driver for this has been customer support on social media.

Offsetting some of the growth across our portfolio, Nu-Seals^TM continued its downward trend with Irish sales of £1.0m (H1 2014: £1.3m) as increased generic competition put further pressure on volumes. This pressure will be intensified if the Irish regulator goes ahead with proposals to include Nu-Seals on the list of interchangeable medicines for which pharmacists can dispense generic substitutes. We have appealed against this and are still awaiting a final adjudication.

Supplies of Quinoderm^TM Cream were halted in the prior year when a key active ingredient supplier ceased production. Sales fell to £Nil (H1 2014: £301,000) and custom synthesising the ingredient by a new manufacturer is underway, although we do not expect supplies to be restored until the end of 2016. Brand presence is being maintained by Quinoderm Facewash, which is unaffected by this issue.

Sales of our Opus^TM stoma care products, acquired in 2012, have remained stable at £1.8m with minimal promotional support.

In our French and German businesses, the value of continuing sales growth was diminished by the weakening euro exchange rate. Translated into sterling, sales remained level in both countries.

In China, the Synthasia International business in which we bought an initial 20% stake has started to grow. Sales were disrupted by a government review of the infant milk market last year, but this had the beneficial effect of driving some competitors out of the market. In the first half of this year total sales grew 18% to pass £1m, taking our share of sales to £215,000 (H1 2014: £182,000). Our other business in China has been faring less well than in 2014. While the market for Forceval remains fairly static, sales volumes have been lower - due mainly to the timing of destocking and restocking in the distribution chain.

Financial performance

Pre-tax profits grew 1.4% to £5.5m (H1 2014: £5.4m), and earnings per share were virtually unchanged at 1.65p (H1 2014: 1.68p).

Gross profit was up 15.7% to £13.8m, reflecting a more favourable product mix following the hand-back of the lower-margin Novartis distribution products. This raised gross margin to 61% (H1 2014: 56%), although we expect to maintain margins in the 55-60% range going forward.

The increase in gross profit was partially absorbed by higher operating costs of £7.6m, up from £6.1m in the first half of 2014 and £7.0m in the second half. Over the past year we have strengthened our supply chain management function, and this has led to a modest increase in staff numbers and costs. The MacuShield acquisition resulted in a further increase this year. In addition legal costs have been higher, associated with other acquisition activity.

We also increased our investment in product promotion by some £300,000 compared with H1 2014. This reflects the addition of MacuShield and a modest increase in support for over-the-counter consumer brands as we increase the weighting of these products in our portfolio.

Despite these increased costs, operating profit grew by 2.2% to £6.1m (H1 2014: £6.0m). As a percentage of sales, it reduced from 27.9% in H1 2014 to 26.8% in H1 2015, still comfortably within our target range of 25-30%.

Cash generation remains strong, but has been impacted this year by an increase in stockholding - with total inventory up from £5.6m in H1 2014 to £7.3m in H1 2015. This results from a strategic increase in inventories to reduce the risk of stockouts, and buffer stocks held during the transfer of some product manufacturing to alternative suppliers. We anticipate some further stockbuilding in the second half, but at a lower level, to further strengthen security of supply. In the first half of this year free cash flow was £2.0m, compared with £4.4m in the first half of last year due to a £1.7m increase in inventory to strengthen our supply chain, plus some timing differences on payments.

Interest costs have increased by £0.2m following the acquisition of MacuShield in February 2015.  This has been offset by a foreign exchange gain of £0.1m resulting in total finance costs being £0.6m (H1 2014 £0.5m).

The £5.5m drawdown from our revolving credit facility for the MacuShield acquisition resulted in an increase in net debt from £21.1m at the start of the period to £26.5m at the end. This raised the bank debt/EBITDA ratio from 1.6 times at the end of 2014 to a still-comfortable 2.0 times; and the unutilised credit facility of £18.3m (end-2014: £23.8m) still leaves ample headroom for further acquisitions.

Dividend

We are maintaining our progressive dividend policy with an interim payment of 0.366p per ordinary share (H1 2014: 0.333p). This provides an increase of 10% on last year's figure while ensuring that dividends continue to be covered more than three times by earnings. The interim dividend will be paid on 14 January 2016 to shareholders on the register on 21 December 2015.

Strategy

Our business model is based on a well diversified and growing portfolio of products and brands, in which currently no single brand represents more than around 13% of total sales.

This portfolio balances two elements. We have a bedrock of brands that are well established in their market niches and will maintain their sales for many years with little or no promotion; and we have a segment of brands in which we invest for growth. By balancing the two, we can invest in targeted marketing to grow sales while maintaining good cash generation and profitability.

Under our long-established 'buy and build' strategy we supplement organic growth with acquisitions that allow us to accelerate expansion and adjust the balance of our portfolio.

In recent years we have been broadening the growth element of our portfolio to include consumer healthcare products. Our growing experience in this area enables us to identify products that offer substantial organic growth potential in return for relatively modest promotional investment. These consumer products also help to balance margin risk across the portfolio because they are not exposed to government price controls.

In 2010, promoted products producing organic growth accounted for some 18% of our portfolio. Today that proportion has more than doubled to about 40% - largely through our expansion in consumer healthcare.

MacuShield was acquired in February this year. This is a once-a-day supplement in capsule form to combat age related macular degeneration, a major cause of sight loss in the elderly. Its acquisition has further boosted our offer to both healthcare professionals and the retail trade. It utilises both sides of our promotional capabilities, being promoted to eyecare clinicians who recommend the product to suitable patients, who subsequently purchase it over the counter in a consumer setting.

We have in-licensed Diclectin for the UK market from Duchesnay Inc of Canada. Diclectin is a well proven product to treat nausea and vomiting in pregnancy. Currently in the UK there is no licensed treatment for this condition that affects 70% to 80% of pregnant women, with severe symptoms occurring in 30% of them. This condition can cause extreme distress and it is estimated that 35% of pregnant women need time off work as a result. Diclectin has a well-established efficacy and safety profile and is regarded as the standard of care for this condition in Canada, where it has been used for over 30 years and has been prescribed for more than 30 million women. In 2013, it was approved in the United States with an FDA Category A safety rating for drugs used in pregnancy. Its uptake there has been very satisfactory.

We submitted Diclectin for UK registration in the second quarter of this year with a view to launching it sometime during 2016, depending on the timing of regulatory processing and approval. If approved, Diclectin will fulfill a much needed gap in the treatment of nausea and vomiting in pregnancy with a licensed medicine and represents a significant growth opportunity for us.

Our preparation for launch is ongoing, involving considerable market access activities throughout the NHS and while we anticipate significant pre-marketing costs in the second half of 2015, this should not prevent us from meeting profit expectations for the year. From early 2016 onwards, we will be in a state of readiness to implement our launch activities. As the first licensed product to treat this condition, we expect Diclectin to generate significant interest.

After an absence of three years, we expect to be able to bring ImmuCyst back to the market in the fourth quarter of this year. Although supplies are likely to be constrained in the near term, we are anticipating strong demand. Many clinicians have expressed a firm preference for ImmuCyst over the currently available alternative; and as this product is itself facing production constraints, ImmuCyst is returning to a market that is currently undersupplied.

It is three years since our supplier, Sanofi, suspended production of ImmuCyst - which had been one of our lead products.  As previously reported, discussions for compensation are ongoing.

Team

As announced in the annual report, there were two changes to board membership in the first half of 2015. Non-executive Director Nigel Clifford joined in January and Finance Director Richard Wright left at the end of May. As previously announced, at the end of September we will welcome Andrew Franklin as our new Finance Director. Andrew brings extensive experience of the pharmaceutical sector gained over many years at Wyeth and more recently at Genzyme Corporation's UK and Ireland subsidiary, where he was Finance Director and Company Secretary.

Charity

We continue to donate products regularly to International Health Partners, which distributes medicines to doctors in the world's neediest areas. We also support employee fundraising for local causes including Wiltshire Air Ambulance, our chosen charity for 2015.

Outlook

Having returned to growth in sales and profits we look forward to further progress in the second half of 2015. We will benefit from the continuing organic growth of our consumer healthcare portfolio, a full six-month contribution from MacuShield, and the return of ImmuCyst in the fourth quarter. We can expect additional impetus to come from the launch of Diclectin in 2016, depending upon regulatory approval.

We also remain very active on the M&A front. We have ample financing headroom and are experiencing an encouraging flow of opportunities both large and small. We are particularly keen to maintain the momentum of international expansion, and are benefiting from having managers on the ground in France, Germany and China. As a result, some three quarters of the opportunities that we have reviewed over the past twelve months have had an international dimension.

Consolidated Income Statement

For the six months ended 30 June 2015

		6 months to 30 June 2015	6 months to 30 June 2014	Year to 31 December 2014
	Note	£ 000s	£ 000s	£ 000s
Revenue		22,795	21,425	43,536
Cost of sales		(8,996)	(9,502)	(18,493)
Gross profit		13,799	11,923	25,043
Administration and marketing expense		(7,232)	(5,754)	(12,510)
Amortisation of intangible assets		(99)	(179)	(488)
Share-based employee remuneration		(385)	(350)	(571)
Share of joint venture profits		26	335	319
Operating profit excluding exceptional item		6,109	5,975	11,793
Exceptional item: impairment		-	-	(622)
Operating profit		6,109	5,975	11,171
Finance costs
Interest payable and similar charges		(722)	(545)	(1,090)
Interest income		35	24	48
Other finance income/(charges)		102	(6)	28
		(585)	(527)	(1,014)
Profit on ordinary activities before taxation		5,524	5,448	10,157
Taxation	4	(1,152)	(999)	(1,772)
Profit for the period attributable to equity shareholders		4,372	4,449	8,385
Earnings per share
Basic (pence)	8	1.65	1.68	3.17
Diluted (pence)	8	1.64	1.67	3.16

Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2015

		6 months to 30 June 2015	6 months to 30 June 2014	Year to 31 December 2014
		£ 000s	£ 000s	£ 000s
Profit for the period		4,372	4,449	8,385
Other items recognised directly in equity:
Items that may be reclassified to profit or loss: Interest rate swaps - cash flow hedge		80	(47)	(572)
Deferred tax on interest rate swap		(16)	14	119
Foreign exchange translation differences		(3)	-	7
Share of joint venture other comprehensive loss		-	-	(8)
Total comprehensive income for the period		4,433	4,416	7,931

Consolidated Balance Sheet

At 30 June 2015

		30 June 2015	30 June 2014	31 December 2014
	Note	£ 000s	£ 000s	£ 000s
Assets
Non-current assets
Intangible fixed assets	5	100,772	89,762	88,875
Property, plant and equipment		508	524	396
Joint venture investment	10	1,297	1,367	1,271
Joint venture receivable		1,462	1,462	1,462
Derivative financial instruments		-	396	-
Deferred tax asset		297	-	194
		104,336	93,511	92,198
Current assets
Inventories		7,283	5,580	5,914
Trade and other receivables	6	9,090	10,721	8,322
Cash and cash equivalents		499	430	1,434
		16,872	16,731	15,670
Total assets		121,208	110,242	107,868
Equity
Ordinary share capital		2,644	2,641	2,641
Share premium account		29,482	29,388	29,388
Share option reserve		2,380	1,774	1,995
Reverse takeover reserve		(329)	(329)	(329)
Other reserve		(39)	317	(103)
Retained earnings		38,914	33,253	37,188
Total equity		73,052	67,044	70,780
Liabilities
Non-current liabilities
Long-term financial liabilities		23,287	22,183	19,235
Other liabilities		1,352	-	-
Deferred  tax liability		8,408	6,425	6,309
Provisions for other liabilities and charges		-	99	-
Derivative financial instruments		49	-	129
		33,096	28,707	25,673
Current liabilities
Cash and cash equivalents		810	855	414
Financial liabilities		2,895	2,895	2,895
Corporation tax		914	875	959
Trade and other payables	7	10,285	9,679	6,920
Provisions for other liabilities and charges		156	187	227
		15,060	14,491	11,415
Total liabilities		48,156	43,198	37,088
Total equity and liabilities		121,208	110,242	107,868

Consolidated Statement of Cash Flows

For the six months ended 30 June 2015

		6 months to 30 June 2015	6 months to 30 June 2014	Year to 31 December 2014
		£ 000s	£ 000s	£ 000s
Operating activities
Result for the period before tax		5,524	5,448	10,157
Interest payable		722	545	1,098
Interest receivable		(35)	(24)	(48)
Other finance costs		(102)	6	(28)
Depreciation of property, plant and equipment		136	152	307
Amortisation of intangible assets		99	179	1,110
Share-based employee remuneration		385	350	571
Change in inventories		(1,369)	(112)	(446)
Change in investments		(26)	(335)	(312)
Change in trade and other receivables		(768)	424	2,823
Change in trade and other payables		(815)	(535)	(1,781)
Tax paid		(964)	(1,133)	(2,028)
Cash flows from operating activities		2,787	4,965	11,423
Investing activities
Interest received		35	24	48
Dividend received		-	-	72
Payment of deferred consideration		-	(20)	-
Development costs capitalised		(7)	(13)	(58)
Purchase of property, plant and equipment		(248)	(84)	(111)
Purchase of other intangible assets		(6,500)	(2,817)	(2.817)
Investment in joint venture		-	(1,003)	(499)
Net cash used in investing activities		(6,720)	(3,913)	(3,365)
Financing activities
Interest paid and similar charges		(588)	(491)	(986)
Loan to joint venture		-	-	503
Proceeds from exercise of share options		97	8	8
Dividend paid		(880)	(800)	(2,398)
Receipt from borrowings		5,500	2,750	2,750
Repayment of borrowings		(1,500)	(1,500)	(4,500)
Net cash used in financing activities		2,629	(33)	(5,629)
Net movement in cash and cash equivalents		(1,304)	1,019	2,429
Cash and cash equivalents at beginning of period		1,020	(1,438)	(1,438)
Exchange losses on cash and cash equivalents		(27)	(6)	29
Cash and cash equivalents at end of period		(311)	(425)	1,020

Consolidated Statement of Changes in Equity

At 30 June 2015

	Ordinary	Share	Share	Reverse
	share	premium	option	takeover	Other	Retained	Total
	capital	account	reserve	reserve	reserve	earnings	equity
	£ 000s	£ 000s	£ 000s	£ 000s	£ 000s	£ 000s	£ 000s
Balance 1 January 2014	2,641	29,380	1,424	(329)	350	31,202	64,668
Issue of shares	-	8	-	-	-	-	8
Dividend paid	-	-	-	-	-	(2,398)	(2,398)
Share-based employee remuneration	-	-	571	-	-	-	571
Transactions with owners	-	8	571	-	-	(2,398)	(1,819)
Profit for the period	-	-	-	-	-	8,385	8,385
Other comprehensive income
Interest rate swaps - cash flow hedge net of deferred tax	-	-	-	-	(453)	-	(453)
Foreign exchange translation differences	-	-	-	-	-	(1)	(1)
Total comprehensive income for the period	-	-	-	-	(453)	8,384	7,931
Balance 31 December 2014	2,641	29,388	1,995	(329)	(103)	37,188	70,780
Balance 1 January 2014	2,641	29,380	1,424	(329)	350	31,202	64,668
Issue of shares	-	8	-	-	-	-	8
Dividend payable/paid	-	-	-	-	-	(2,398)	(2,398)
Share-based employee remuneration	-	-	350	-	-	-	350
Transactions with owners	-	8	350	-	-	(2,398)	(2,040)
Profit for the period	-	-	-	-	-	4,449	4,449
Other comprehensive income
Interest rate swaps - cash flow hedge net of deferred tax	-	-	-	-	(33)	-	(33)
Total comprehensive income for the period	-	-	-	-	(33)	4,449	4,416
Balance 30 June 2014	2,641	29,388	1,774	(329)	317	33,253	67,044
Balance 1 January 2015	2,641	29,388	1,995	(329)	(103)	37,188	70,780
Issue of shares	3	94	-	-	-	-	97
Dividend payable/paid	-	-	-	-	-	(2,643)	(2,643)
Share-based employee remuneration	-	-	385	-	-	-	385
Transactions with owners	3	94	385	-	-	(2,643)	(2,161)
Profit for the period	-	-	-	-	-	4,372	4,372
Other comprehensive income
Interest rate swaps - cash flow hedge net of deferred tax	-	-	-	-	64	-	64
Foreign exchange translation differences	-	-	-	-	-	(3)	(3)
Total comprehensive income for the period	-	-	-	-	64	4,369	4,433
Balance 30 June 2015	2,644	29,482	2,380	(329)	(39)	38,914	73,052

Notes to the Half Yearly Report

For the six months ended 30 June 2015

1          Nature of operations

Alliance Pharma plc ("the company") and its subsidiaries (together "the Group") acquire, market and distribute pharmaceutical products. The company is a public limited company incorporated and domiciled in England. The address of its registered office is Avonbridge House, Bath Road, Chippenham, Wiltshire, SN15 2BB.

                The company is listed on the London Stock Exchange, Alternative Investment Market (AIM).

2          General information

The information in these financial statements does not constitute statutory accounts as defined in section 434 of the Companies Act 2006 and is un-audited. A copy of the Group's statutory accounts for the period ended 31 December 2014, prepared under International Financial Reporting Standards as adopted by the European Union, has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified and did not contain statements under section 498(2) or section 498(3) of the Companies Act 2006.

The interim financial report for the six month period ended 30 June 2015 (including comparatives for the six months ended 30 June 2014) was approved by the Board of Directors on 8 September 2015.

The current rate of cash generation by the Group comfortably exceeds the capital and debt servicing needs of the business (though there cannot, of course, be absolute certainty that the rate of cash generation will be maintained).  The Board remains confident that all the bank covenants will continue to be met.  The Group has a £5m Working Capital Facility of which £4.2m is undrawn at the balance sheet date and which the Board believes should comfortably satisfy the Group's working capital needs for at least the next 12 months.

3          Accounting policies

The same accounting policies and methods of computation are followed in the interim financial report as published by the company in its 31 December 2014 Annual Report. The Annual report is available on the company's website at www.alliancepharma.co.uk.

4          Taxation

Analysis of charge in period.

	30 June 2014	30 June 2014	31 December 2014
	£ 000s	£ 000s	£ 000s
United Kingdom corporation tax at 22%/23.5%/23.25%
In respect of current period	920	854	1,870
Adjustment in respect of prior periods	-	-	(38)
Current tax	920	854	1,832
Deferred  tax	232	145	(60)
Taxation	1,152	999	1,772

Notes to the Half Yearly Report (continued)

For the six months ended 30 June 2015

5.         Intangible assets

	Goodwill on consolidation	Purchased Goodwill	Technical know-how, trademarks and distribution rights	Development costs	Total
The Group	£ 000s	£ 000s	£ 000s	£ 000s	£ 000s
Cost
At 1 January 2015	1,144	2,449	88,504	431	92,528
Additions	-	1,748	10,241	7	11,996
At 30 June 2015	1,144	4,197	98,745	438	104,524
Amortisation and impairment
At 1 January 2015	-	-	3,653	-	3,653
Amortisation for the period	-	-	99	-	99
At 30 June 2015	-	-	3,752	-	3,752
Net book amount
At 30 June 2015	1,144	4,197	94,993	438	100,772
At 1 January 2015	1,144	2,449	84,851	431	88,875

The following acquisition activities took place in the year:

·      On 2 February 2015, the Group completed the acquisition of MacuVision Europe Limited ("MacuVision") for initial consideration of £5.5 million plus the net asset value of MacuVision at completion (£0.5m) and deferred contingent consideration of up to £6.0 million (estimated at £3.2m). MacuVision sells MacuShield, an eye care treatment designed to be taken by sufferers of dry age-related macular degeneration and other eye conditions. The fair value of the intangible asset acquired was £8.7m included within technical know-how, trademarks and distribution rights. Goodwill of £1.7m arose on the acquisition of MacuVision.

·      On 29 January 2015, the Group entered a Licence and Supply Agreement for the product Diclectin with Duchesnay Inc. The consideration recognised in relation to this is £1.5m.  Diclectin is a product to treat nausea and vomiting of pregnancy and is anticipated to launch in the second half of 2016.

6          Trade and other receivables

	30 June 2015	30 June 2014	31 December 2014
	£ 000s	£ 000s	£ 000s
Trade receivables	7,710	8,684	6,645
Other receivables	278	654	669
Prepayments and accrued income	530	561	453
Amounts owed by joint venture	572	822	555
	9,090	10,721	8,322

7          Trade and other payables

	30 June 2015	30 June 2014	31 December 2014
	£ 000s	£ 000s	£ 000s
Trade payables	237	2,611	1,693
Other taxes and social security costs	1,191	832	969
Accruals and deferred income	4,330	4,407	4,065
Other payables	285	231	193
Deferred consideration	2,478	-	-
Dividend payable	1,764	1,598	-
	10,285	9,679	6,920

Notes to the Half Yearly Report (continued)

For the six months ended 30 June 2015

8          Earnings per share (EPS)

Basic EPS is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.  For diluted EPS, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares.

A reconciliation of the weighted average number of ordinary shares used in the measures is given below:

	6 months to 30 June 2015	6 months to 30 June 2014	Year ended 31 December 2014
	Weighted average number of shares 000s	Weighted average number of shares 000s	Weighted average number of shares 000s
For basic EPS	264,216	264,108	264,148
Share options	3,097	2,033	1,455
For diluted EPS	267,313	266,141	265,603

	6 months to 30 June 2015	6 months to 30 June 2014	Year ended 31 December 2014
	£ 000s	£ 000s	£ 000s
Earnings for basic and diluted EPS	4,372	4,449	8,385

The resulting EPS measures are:

	6 months to 30 June 2015	6 months to 30 June 2014	Year ended 31 December 2014
	Pence	Pence	Pence
Basic EPS	1.65	1.68	3.17
Diluted EPS	1.64	1.67	3.16

Notes to the Half Yearly Report (continued)

For the six months ended 30 June 2015

9          Dividends

		6 months to 30 June 2015					6 months to 30 June 2014			Year ended 31 December 2014
			Pence/share	£ 000s			Pence/share		£ 000s		Pence/share £ 000s
	Amounts recognised as distributions to owners in the year
	Interim dividend for the prior financial year		0.333			880	0.303	800		0.303		800
	Final dividend for the prior financial year		-			-	-	-		0.605		1,598
	Proposed final dividend for the prior financial year		0.667			1,763	0.605	1,598		-		-
					2,643			2,398				2,398

The proposed final dividend for the prior financial year was approved by the Board of Directors on 24 March 2015 and subsequently by the shareholders at the Annual General Meeting on 27 May 2015. The proposed dividend has been included as a liability as at 30 June 2015 in accordance with IAS 10 Events After the Balance Sheet Date. The proposed final dividend for the prior financial year was paid on 15 July 2015 to shareholders who were on the register of members at 19 June 2015.

10        Joint Ventures

	Name			Principal Activity		Country of Incorporation			% Owned
	Unigreg Limited			Distribution of pharmaceutical		British Virgin Islands			60
				products to China
	Synthasia International			Distribution of infant milk		Hong Kong			20
	Company Ltd			formula products in China
The following table shows the aggregate movement in the Group's investment in joint ventures:
							£ 000s
		At 1 January 2015					1,271
		Share of post-tax profits of joint ventures					26
		At 30 June 2015					1,297

 

END

 

 

IR LFFEIADITIIE