Dechra Pharmaceuticals reports strong Q3 revenues thanks to jump in US sales

28th Apr 2015 09:07

Veterinary products manufacturer Dechra Pharmaceuticals said on Tuesday its full-year results will be in line with managements expectations after reporting an increase in revenues during the third quarter.Dechra saw its revenues up 14.3% at constant exchange rate driven by strong pre-Easter ordering in Europe and competitor stock shortages in the US. At actual exchange rate (AER), revenues increased 6%.In Europe, revenues fell 3.3% at AER due to a weak euro during the third quarter due to a 12.8% decrease in sales in its food producing animal products. However, companion animal products, equine and diets franchises grew thanks to wholesalers buying ahead of the Easter break.Thanks to the acquisition of Phycox, a supplement product for dogs, the launch of Osphos, an injection for horses, and the re-launch of two ophthalmic products, its US sales grew 66.8% at constant exchange rate and 76.4% at AER.Meanwhile, like-for-like revenue grew 57.7%. Strong dermatology products sales also drove the results, as competitors faced a out-of-stock situation.Shore Capital analysts gave a 'buy' recommendation and a 1022p target price.The broker said the company's move from a services and veterinary pharmaceuticals hybrid to a pure pharmaceuticals company has provided "significantly great focus" at Dechra.It also noted that the companion animal market has provided the greatest opportunity for growth, while changes in antibiotic prescribing has led to a decline in sales in its farm animal business, particularly in Holland."The next several years should bear witness to a wave of new products which should boost growth of the higher margin CAP business and drive operating leverage," the analysts commented.Shares were down 0.93% to 1012p on Tuesday at 09:38.