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Ebos profit soars in first full year of Symbion

Ebos profit soars in first full year of Symbion, sees growth in 2015

By Suze Metherell

Aug. 26 (BusinessDesk) - Ebos Group, the healthcare and animal care manufacturer, posted full-year profit that almost tripled on a full 12-month contribution from the Symbion pharmaceutical wholesaler and distributor in Australia.

Net profit was $92.1 million, or 62.8 cents a share, in the year ended June 30, from $28.2 million, or 46.8 cents, a year earlier, the Christchurch-based company said in a statement. Sales jumped 216 percent to $5.76 billion.

The $1.1 billion cash and scrip Symbion purchase in June 2013 was a game-changer for Ebos, more than tripling annual revenue in a deal that gave Symbion’s owner Zuellig Group a cornerstone 40 percent stake in the New Zealand business. Australia now makes up 78 percent of sales and 80 percent of pretax earnings for the group and in the latest year revenue from across the Tasman got a lift from the relative strength of the kiwi dollar.

Healthcare earnings before interest, tax, depreciation and amortisation rose 212 percent to $153 million, although the earnings margin slipped to 2.8 percent from 3 percent. The company's animal care division reported a 100 percent jump in sales to $338.9 million and a 58 percent increase in Ebitda to $29.4 million, while the Ebitda/revenue margin shrank to 8.7 percent from 11 percent.

Sales at the company's Australian pharmacy business were little changed from a year earlier, which the company said was a good outcome given the Australian government's price reforms under its Pharmaceutical Benefits Scheme.

"The breadth of Symbion’s healthcare businesses has enabled the company to further grow its profitability even after allowing for the impact of the Australian Government’s PBS price reforms," said managing director Mark Waller, delivering his final results before stepping down from the role.

"Whilst we face on-going regulatory challenges in our pharmacy markets we have always demonstrated innovative ways to generate earnings growth and we are confident that our management team can continue the company’s strong track record of growth into FY15," the company said.

Patrick Davies is taking up the role of chief executive.

The company will pay a final dividend of 20.5 cents a share on Oct. 17, imputed at 35 percent. That takes payments for the year to 41 cents.

Shares of Ebos last traded at $9.45 and have slipped 2.6 percent this year while the benchmark NZX 50 Index rose 9.7 percent. The stock is rated a 'hold' based on the consensus of five analysts polled by Reuters, with a median price target of $10.29.


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