TIDMCVSG
RNS Number : 5445G
CVS Group plc
26 November 2020
26 November 2020
CVS Group plc
("CVS" or the "Company" and, together with its subsidiaries, the
"Group")
AGM Statement and Trading Update
CVS, one of the UK's leading providers of integrated veterinary
services, is holding its AGM at 11.00 a.m. today and provides the
following update to shareholders ahead of the meeting. Financial
data is stated in accordance with the adoption of IFRS 16, except
where otherwise indicated.
Summary
-- The positive start to the new financial year has continued into September and October
-- Total sales grew by 6.3% in the four-month period to 31
October; like-for-like sales (1) in creased by 5.1% despite the
postponement of the annual July price review
-- EBITDA margin for the four months improved to 18.7% or 15.4% on a pre IFRS 16 basis
(2019: 18.2%; 14.7% pre IFRS 16)
-- Positive trading performance, coupled with continued strong
cash generation, has led to a further reduction in net debt to
GBP40.9m, with leverage (2) reducing to less than 1.0x at 31
October 2020
-- Three acquisitions have been completed in the current
financial year (FY19: four), all in accordance with the Group's
strict investment criteria
-- All CVS practices remain open in current lockdown, offering
the majority of services to clients
Current Trading
The Board is pleased to report that the previously announced
positive performance for the first two months of the new financial
year has continued through September and October, with current
trading ahead of that in the prior year. Encouragingly, during the
current COVID-19 lockdown restrictions, all our practices have
remained open and are offering the majority of services to
clients.
In the four-month period to 31 October 2020, the Group's total
sales grew by 6.3% and like-for-like ("LFL") sales (1) in creased
by 5.1% c ompared to t he same peri od last year, reflecting
continued growth despite the postponement of price increases
ordinarily scheduled to take effect from 1 July 2020. This was
achieved through a combination of growth in the clinical work in
our core Practices division and related services, and increased
demand in Animed Direct, the Group's online pharmacy and retail
business.
Wi t hin t he Gro u p 's c ore Prac tices division (3) , L FL
sales in creased by 2.8% over t he same peri od. T his L FL growth
rate is stated before the recognition of Healthy Pet Club ("HPC")
income of circa GBP6m deferred from the prior year and primarily
reflects a continued focus on high levels of clinical care coupled
with increased new client registrations.
Our HPC preventative medicine scheme has seen a further increase
in membership since the financial year end, up 3.1% to 428,000 (30
June 2020: 415,000).
Group EBITDA margin has improved to 18.7% (pre-IFRS 16: 15.4%),
compared to 18.2% for the corresponding period in the previous year
(pre-IFRS 16: 14.7%), largely reflecting the improvement in top
line sales as the Group continues to benefit from its integrated
veterinary platform.
The vet vacancy rate has remained stable in the four months to
31 October 2020 at 7.5% (prior year corresponding period: 8.1%),
with the Group continuing to champion initiatives to recruit and
retain staff as it strives to be the veterinary company that people
most want to work for.
The Group has completed three acquisitions in the current
financial year, in accordance with its strict investment criteria,
and reflecting the Group's commitment to complement organic growth
with acquisitions of carefully selected practices:
-- Tremain Veterinary Group, a two site small animal practice in
Oxfordshire, acquired on 4 November 2020;
-- Astonlee Veterinary Group, a single site small animal
practice in Milton Keynes, acquired on 17 November 2020; and
-- White Lodge Vets, a single site small animal practice in Devon, acquired on 19 November 2020.
Net Debt
Strong cash generation across our operations has continued since
year end and has contributed to a further reduction in the Group's
net debt, which stood at GBP40.9m as at 31 October 2020 (30 June
2020: GBP62.1m). Leverage on a bank test basis (2) has similarly
reduced to less than 1.0x (30 June 2020: 1.14x). These metrics
remain in line with management expectations and put the Group in a
resilient position to mitigate any potential impact of more severe
COVID-19 restrictions, whilst allowing the Group to continue to
invest in its people, practices and platform, supplemented by
selective acquisitions.
Management team
The Group has further strengthened its management team with the
appointment of Enrico Tizzano as its first Chief Technology
Officer. Enrico will support the effective use of technology and
data in delivery of the Group's strategic objectives and has a
wealth of experience from previous CTO roles in large,
consumer-facing organisations.
Outlook
The veterinary services market continues to benefit from
favourable consumer trends, with increasing pet ownership.
Alongside our excellent clinical standards and preventative care
offerings, and the breadth of our integrated model, this is
providing a number of resilient revenue streams despite the
continued macro uncertainty. The Board is pleased with the Group's
performance across all operations, with the positive start to the
new financial year continuing into September and October. The Board
would like to acknowledge and thank all the members of the CVS team
for their continuing dedication to the delivery of the best
possible care to animals.
Notes
1 Like-for-like sales are defined as revenue generated from
like-for-like operations compared to the prior year, adjusted for
the number of working days. For example, for a practice acquired in
September 2019, revenue is included in the like-for-like
calculations from September 2020.
2 Leverage on a bank test basis is net bank borrowings; divided
by 'Adjusted EBITDA' annualised for the effect of acquisitions and
including costs relating to business combinations and exceptional
items. Adjusted EBITDA is profit before income tax, net finance
expense, depreciation, amortisation, costs relating to business
combinations and exceptional items.
3 Practices LFL growth stated is for core Small Animal,
Referrals, Equine and Farm practices and excludes Buying Groups
& Other and intra-group elimination.
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014.
Contacts:
CVS Group plc via MHP Communications
Richard Fairman, CEO
Ben Jacklin, COO
Robin Alfonso, CFO
N+1 Singer (Nominated Adviser & Broker) +44 20 7496 3000
Aubrey Powell / Jen Boorer (Corporate Finance)
Rachel Hayes (Corporate Broking)
MHP Communications (Financial PR) +44 20 3128 8549
Andrew Jaques / Rachel Mann / Charles Hirst
Notes to Editors
CVS Group is one of the leading integrated veterinary service
providers in the UK, the Netherlands and the Republic of Ireland.
CVS is focused on providing a high quality, people-led service to
its customers and their animals, with outstanding and dedicated
clinical teams and support colleagues at the core of its
strategy.
The Group operates an integrated model with over 480 veterinary
practices across its three markets, including eight specialist
referral hospitals and 29 dedicated out-of-hours sites. Alongside
the core Practices division, CVS also owns and operates
Laboratories (providing diagnostic services to CVS and third
parties), Crematoria (providing pet cremation and clinical waste
disposal for CVS and third party practices), Buying Groups and
Animed Direct (the Group's online pharmacy and retail
business).
The Group employs over 7,000 personnel, including over 1,900
veterinary surgeons and in excess of 2,300 nurses across its three
territories.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCKELFLBFLZFBV
(END) Dow Jones Newswires
November 26, 2020 02:00 ET (07:00 GMT)
Grafico Azioni Cvs (LSE:CVSG)
Storico
Da Feb 2024 a Mar 2024
Grafico Azioni Cvs (LSE:CVSG)
Storico
Da Mar 2023 a Mar 2024