EBOS Delivers Again
20 August 2013
EBOS Delivers Again
Acquisition of Symbion in Australia for $1.1 billion creating Australasia’s largest healthcare and animal care products supplier
Successful capital raising to support Symbion acquisition
Full year of trading for Masterpet in New Zealand
14.4 per cent increase in EBITDA (excluding Symbion)
Nominated as preferred bidder for HBL contract to supply all District Health Boards in New Zealand
The EBOS Group has achieved another outstanding year of financial performance while undertaking a landmark transaction to create a platform for further growth as a leading provider of healthcare and animal care products in Australia and New Zealand.
EBOS Managing Director and Chief Executive Officer Mark Waller says “the acquisition of Symbion’s complementary business in Australia with effect from 1st June 2013 means that EBOS is now the largest diversified Australasian marketer, wholesaler and distributor of healthcare, medical and pharmaceutical products and a leading Australasian animal care products distributor. It is a position of significant strategic strength creating opportunities to further assist our customers”.
Group financial performance
Including 18 days trading for Symbion, revenues for the financial year to 30 June 2013 rose 27.6 per cent to $1.823 billion from $1.428 billion in 2012.
The tax expense increased by 71 per cent to $14 million ($8.15 million) reflecting the nondeductibility of certain Symbion acquisition costs and low taxation charge in the previous year arising from oneoff tax benefit in connection with the acquisition of Masterpet.
Excluding the short trading period for Symbion and one off transaction costs, the results for the Group reflected another year of strong performance that beat forecast, Mr Waller says.
“Earnings directly attributable to the business (ebitda) grew ahead of forecast and rose 14.4 per cent over the previous financial year to $53.6 million ($46.85 million), driven by the inclusion of the first full year of trading by Masterpet, a strong performance across all the NZ healthcare businesses and by competitive positioning in Australia.”
Net profit after tax rose 5.5 per cent to $29.5 million ($27.95 million), even after the significantly higher tax charge. (These numbers exclude Symbion June results and oneoff transaction costs as disclosed in the Financial Statements)
In June the Group undertook a placement of new shares and an entitlement offer to all shareholders to partly fund the Symbion acquisition from Zuellig Group. As part consideration, Zuellig received new EBOS shares and, with its associates, is now the Group’s largest shareholder with a holding of 40 per cent of the issued shares. We see the Zuellig shareholding as a major vote of confidence. In addition to raising new equity, the Group assumed Symbion debt totalling $230 million.
As indicated in the Offer document for the Entitlement Offer, shareholders will receive a partially imputed final dividend for the 2013 financial year of 15 cents a share payable on 22 October 2013. This follows an interim dividend of 17.5 cents paid in April 2013 and a 4 for 53 bonus issue of ordinary shares in June. The Directors have indicated an intent to pay future dividends equating to 6070 per cent of normalised net profit after tax subject to the cash requirements of the Group.
The Symbion acquisition is a “game changer”. We have strong market positions with excellent systems and management in all our businesses in Australia and New Zealand with opportunities for further growth. In addition, work is progressing on leveraging the strengths of EBOS and Symbion. The immediate focus is on translating EBOS’s experience in third party logistics to Symbion.
EBOS was delighted to be nominated as the preferred bidder for the significant HBL contract to manage and deliver healthcare products to District Health Boards throughout New Zealand. This will be an opportunity for EBOS to further leverage its expertise in logistics and distribution to meet the critical requirements of DHBs. Detailed proposals are now being developed to meet the Ministry of Health’s exacting requirements.
The first few weeks trading of the 2014 financial year have been in line with expectations. This gives the Group confidence that financial performance will be consistent with the forecasts for the six months to 31 December 2013 contained in the prospectus for the entitlement offer announced in June 2013. Now that approximately three quarters of the Group’s earnings are denominated in Australian dollars, reported results will be subject to currency fluctuations.
Chairman, Rick Christie said “Work is underway to facilitate the dual listing of the Group’s shares on the ASX. This will potentially provide benefits for shareholders through increased investor awareness and greater liquidity in the Group’s stock”.
|EBOS GROUP LIMITED REPORTED CONSOLIDATED
INCOME STATEMENT |
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2013
(# Adjusted numbers exclude Symbion results for June 2013 and one off transaction costs)