Monday, 11 July 2022

Dechra^® Pharmaceuticals PLC

(Dechra, Group, Company)

Trading Update

The Board of Dechra issues the following unaudited Trading Update covering the Group's financial year ended 30 June 2022 (the Period) ahead of the announcement of its Preliminary Results.

Overview

The Board is pleased to report that the Group's strong trading performance continued throughout the Period and remains in line with expectations. The Group delivered excellent year on year organic revenue growth, supplemented by the previously announced product acquisitions.

Highlights

Ian Page, Chief Executive Officer, said:

"We are delighted that the financial year just ended was another record year for Dechra and in line with expectations, with Group revenue growth slowing to more normal levels as expected in H2 as the impact of the pandemic on our markets unwinds. Whilst we expect current macroeconomic uncertainties to continue, the veterinary pharmaceutical market remains resilient and in growth. Our global trading continues to be strong and we continue to outperform the market, particularly in North America.   

The complementary product acquisitions we made during the period strengthen our existing portfolio and are performing in line with initial expectations; there are a number of acquisition opportunities that we are assessing. We continue to believe in the ability of our people to execute our strategy and remain confident in our future prospects."

Operational Review

European Pharmaceuticals

In the Period, our total European Pharmaceuticals Segment revenue increased by c.8% at CER (AER c.5%), including the contribution from Tri-Solfen® ANZ (acquired 5 February 2021) and Osurnia®  (acquired 27 July 2020).

Existing net revenues increased by c.6% at CER (AER c.3%).

North American Pharmaceuticals

Our total North American Pharmaceutical Segment growth increased by c.24% at CER (AER c.25%), despite increased generic competition. Revenue also included the contribution from the various product rights acquisitions we made during the period and Osurnia (July sales). 

Existing net revenues increased strongly by c.21% at CER (AER c.22%).

Selling, General and Administrative Expenses

Our cost base normalised as expected, as COVID-19 restrictions reduced, and has increased further as a result of global inflationary pressures that we believe we are well placed to proactively manage.

In light of the clarification from the IFRS Interpretations Committee (IFRIC) regarding how companies should account for configuration and customisation costs relating to cloud computing arrangements, including Software as a Service (SaaS), which has led to a change in accounting policy in the application of IAS38 Intangible Assets, we have expensed c.£1.5 million of costs through our income statement in the Period which would previously have been capitalised.

Notice of Results

Dechra will announce its Preliminary Results for the Period on Monday, 5 September 2022.

Notes:

1) Foreign Exchange Rates:

FY2022 Average: EUR 1.1807: GBP 1.0; USD 1.3316: GBP 1.0

FY2022 Closing: EUR 1.1652: GBP 1.0; USD 1.2103: GBP 1.0

FY2021 Average: EUR 1.1287: GBP 1.0; USD 1.3466: GBP 1.0

FY2021 Closing: EUR 1.1654: GBP 1.0; USD 1.3850: GBP 1.0

2) Acquisitions:

2 July 2021: Isoflurane® and Sevoflurane® product rights

20 September 2021: ProVet^TM  system rights

11 October 2021: Rompun® and Butorphanol product rights

28 October 2021: Sucromate® product rights

10 January 2022: Laverdia® product rights

3) Existing Revenue is revenue including the impact of acquisitions where there is a comparative period and therefore growth rates are stated on a like for like basis

About Dechra

Dechra is a global specialist veterinary pharmaceuticals and related products business. Our expertise is in the development, manufacture and sales and marketing of high quality products to improve animal welfare, exclusively for veterinarians worldwide.   

For more information, please visit: www.dechra.com

Stock Code: Full Listing (Pharmaceuticals): DPH

LEI: 213800J4UVB5OWG8VX82

Trademarks

Dechra and the Dechra "D" logo are registered trademarks of Dechra Pharmaceuticals PLC.

Forward Looking Statement

This document may contain certain forward-looking statements.  The forward-looking statements reflect the knowledge and information available to the Company during the preparation and up to the publication of this document.  By their very nature, these statements depend upon circumstances and relate to events that may occur in the future thereby involve a degree of uncertainty.  Therefore, nothing in this document should be construed as a profit forecast by the Company.

Market Abuse Regulation (MAR)

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018.  Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.