Sinclair IS Pharma hails aesthetic growth as strategic talks continue

17th Feb 2015 13:35

Interim results at Sinclair IS Pharma matched analyst forecasts, but the medicinal and aesthetic dermatology specialist warned the weaker euro and difficulties with Russia may weigh on the second half.The AIM-listed company said a potential sale of the business remains on the cards, as a result of the strategic review announced in November, with "a number of parties...willing to explore some form of co-operation, including but not limited to merger and acquisition opportunities, licensing of products or development collaborations".Thanks to three recently acquired non-surgical facelift brands, revenues soared 31% to £32.0m and operating profits before share based payments, longterm incentive schemes and exceptional items rose exactly 200% to £3.3m.In light of Samuel Johnson's famous opinions on round numbers, it should also be noted that the company's pre-tax losses tripled to £10.8m, reflecting a hugely increased interest of £2.6m due to increased borrowings taken on in the second half of last year, plus £4.3m of non-cash charges for the unwinding of discounting applied to deferred consideration and FX losses of £0.8m.Aesthetic sales more than to £13.7m in the first half thanks to strong performances from each of the recently acquired brands Silhouette skin tightener, Perfectha wrinkle filler and Ellansé skin plumping. Ongoing difficulties encountered in Russia with Silhouette will hit the second half however.Non-aesthetics growth at 9% on a like-for-like basis in the period but is expected to be lower for the full year.Chief executive Chris Spooner said the bulk of growth was expected to come from higher-margin aesthetics products."Accelerating growth towards the end of the period, in-market demand and demand for training give us confidence in a strong H2 performance. Additionally, geographical expansion, and anticipated product approvals point to further attractive growth opportunities in the medium term."Growth trends in aesthetics combined with manufacturing efficiency improvements point to a sharp uptick in second half gross margins while the benefit of continued operating leverage is expected to maintain a continued improvement in EBITDA margin trends".