UDG raises full-year earnings forecast as revenues rise by 9%

Healthcare services provider UDG has upgraded its full-year earningsforecaston the back of strong organic growth as it announced a 26 per cent rise in pre-tax profits for the six months to 31 March.

The group said pre-tax profits rose to €46 million while operating profit was up 19 per cent to €53.6 million from €45 million a year earlier.

Revenue rose 9 per cent to €1.13 billion, UDG said.

Listed on the London Stock Exchange, the Dublin-based provider of services to healthcare manufacturers and pharmacies, has operations in 22 countries.

UDG said it expected adjusted earnings per share (EPS) growth of between 7 per cent to 9 per cent at constant currency for the full-year, having previously forecast growth of between 5 per cent to 8 per cent.

"The first half of 2015 has been a period of further strong advancement for the group as our strategy to expand into higher growth areas continued to deliver robust profit growth. Our two growth platforms, Sharp and Ashfield, accounted for over 70 per cent of the group's operating profit in the period and in aggregate increased profits by 55 per cent," said chief executive Liam FitzGerald.

The group said its healthcare communications business Ashfield, which became the largest profit contributing division for the first time last year, delivered a very strong performance with revenues up 35 per cent to €292.8 million and operating profit up 55 per cent to €25.9 million.

Its packaging and printing business Sharp, also reported a positive performance with revenues of €110.4 million and profits of €11.8 million, which were 35 per cent and 57 per cent ahead of the prior period respectively

The group recognised an exceptional charge in the period of €10.7 million, which was due to the restructuring of its healthcare communications subsidiary following acquisitions in 2014, restructuring within its supply chain division, and costs related to the closure of Aquilant’s UK laboratory distribution business.

UDG said it anticipated a full-year exceptional charge in the region of €13 to €15 million of which €4 to €5 million is non-cash.