| 18 September 2024 |
Advanced Medical Solutions Group plc
(“AMS” or the “Group”)
Interim results for the six months ended 30 June 2024
~ H1 delivering high quality growth alongside transformative Peters Surgical acquisition ~
~ Current trading in line, FY expectations reiterated ~
Winsford, UK, 18 September 2024: Advanced Medical Solutions Group plc (AIM: AMS), the world-leading specialist in tissue-healing technologies, today announces its unaudited interim results for the six months ended 30 June 2024 (the “Period”).
Financial Highlights:
| H12024 | H12023 | Reported change | Change at constant currency¹ | |
| Revenue (£ million) | 68.0 | 63.1 | +8% | +10% |
| Adjusted Measures | ||||
| Adjusted² profit before tax (£ million) | 14.8 | 13.8 | +8% | |
| Adjusted² profit before tax margin % | 21.8% | 21.8% | 0.0pp | |
| Adjusted² diluted earnings per share (p) | 5.35 | 4.97 | +8% | |
| Reported Measures | ||||
| Profit before tax (£ million) | 5.7 | 11.8 | -52% | |
| Profit before tax margin % | 8.4% | 18.7% | -10.3pp | |
| Diluted earnings per share (p) | 1.92 | 4.06 | -53% | |
| Net operating cash flow (£ million) | 7.0 | 4.1 | +68% | |
| Net cash3 (£ million) | 55.6 | 69.1 | -20% | |
| Interim dividend per share (p) | 0.77p | 0.70p | +10% |
Business Highlights (including post period end):
Operational
· Robust financial performance in line with expectations, with strong organic growth in the Period driven by the Surgical business, with particularly strong growth from US LiquiBand®.
· The transformative acquisition of Peters Surgical, completed 1 July 2024, a leading global provider of specialty surgical sutures, mechanical haemostasis and internal cyanoacrylate devices, substantially strengthens AMS’s position as a leading global surgical supplier; with the integration of the business progressing well.
· The acquisition of Syntacoll GmbH (“Syntacoll”), completed 1 March 2024, a specialist manufacturer of drug-eluting collagens, strengthens the Group’s existing Biosurgical business.
· The Board has completed a strategic review of the Woundcare Business Unit and has concluded that profitability of the Unit can be improved by focusing on higher margin business and reducing investment in certain areas.
Financial
· Revenue increased by 8% to £68.0 million and by 10% at constant currency (2023 H1: £63.1 million) driven by growth across all categories in the Surgical Business Unit, partly offset by challenges in the Woundcare Business Unit.
· Surgical revenues increased by 23% to £48.4 million (2023 H1: £39.4 million) and by 27% at constant currency, with double-digit growth in all product categories.
· US LiquiBand® grew by 54% at constant currency, due to significant momentum from the success of AMS’s 2023 renegotiation of distribution agreements with key partners, an element of partner stock rebuild and in comparison to a weak prior period.
· Significant US launch orders were also received in the Period for LIQUIFIXTM with repeat orders expected in H1 2025, following a longer than anticipated Group Purchasing Organisations (“GPOs”) approval process.
· Woundcare revenues decreased by 17%, at both reported currency and constant currency, to £19.5 million (2023 H1: £23.7 million) due to the previously reported declining Organogenesis royalty and weak demand, in particular within exudate management, which included the cessation of certain low margin business.
· Gross margins reduced to 54.3% (2023 H1: 56.5%) due to the previously reported reduction in Organogenesis royalty income stream, weakness in the Woundcare Business Unit and the addition of Syntacoll which currently operates at a lower margin.
· Adjusted profit before tax increased by 8% to £14.8 million (2023 H1: £13.8 million) with adjusted profit before tax margin remaining constant at 21.8% (2023 H1: 21.8%). Reported profit before tax declined to £5.7 million (2023 H1: £11.8 million) as a result of significant acquisition-related exceptional items incurred in the period.
· Net cash3 decreased to £55.6 million from a year-end position of £60.2 million (2023 H1: £69.1 million) following the acquisition of assets of Syntacoll, and contingent consideration for Connexicon Medical Ltd (“Connexicon”) following positive achievement of Research & Development milestones. Additional working capital has also been required to support Surgical growth. Post period end (as at 1 July), following the completion of the Peter’s Surgical acquisition, the Company’s net debt position was £ 56.2 million.
· Given the Board’s continued confidence in the future, the interim dividend is increased 10% to 0.77p per share (2023 H1: 0.70p)
Outlook
· Outlook remains unchanged and the Board anticipates that revenue and adjusted profit will be in line with its expectations.
Commenting on the interim results Chris Meredith, CEO of AMS, said: “We are delighted with the progress made so far this year, having completed the acquisitions of Peters Surgical and Syntacoll and now being able to report such a strong first half performance from the AMS Surgical business unit. Since the completion of the Peters Surgical deal in July, integration has been progressing well, and the business is proving to be an excellent fit culturally and strategically. Whilst Woundcare has continued to struggle, we believe we have a pathway to improving its profitability. We feel confident that our enlarged portfolio, greater geographic reach, the synergies that we believe can be established over the next three years, combined with the revitalised momentum established in the legacy AMS Surgical business has set us on a very strong trajectory for growth in the long-term.”
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