Dechra Pharma H1 profits up but Netherlands disappoints

25th Feb 2014 08:50

Veterinary drug group Dechra Pharmaceuticals boosted half-year revenue in most of its markets but a disappointing performance in the Netherlands, the phasing of export orders and US supply issues hit trading.Dechra, which makes or markets products such as cat sedative Alfaxan and dog endocrinology treatment Forthyron, said underlying operating profit in the six months to December 31st rose 14.1% to £22.3m.But revenue fell 0.7% to £95.9m, which Dechra blamed partly on the impact of new dispensing guidelines in the Netherlands.It also attributed the drop to the timing of export orders and to problems with supplies of its Animax and sterile ophthalmic products in its US business.After disposing of its services business last August, Dechra is focusing on selling existing products and maximising returns from those, expanding geographically to cash in on growth potential in Europe and emerging markets, and strategic acquisitions.The group, which also said it was successfully integrating its Eurovet Animal Health acquisition into the business, declared an interim dividend of 4.75p per share, up 9.4% versus a year ago.Dechra is facing pressure in Europe to reduce anti-microbial usage in animal medicine due to concerns of potential cross-over resistance from animals to humans by over-utilisation of antibiotics.Chief Executive Ian Page said the company was confident that its earnings will meet its expectations for the financial year."We are, however, cautious regarding the overall economic environment and the ongoing concerns regarding antimicrobial products used in veterinary medicine," he said.Shares rose 11.5p or 1.7% to 690p at 09:06 in London.PW