Financial and operational highlights
Financial highlights
- 34% advance in profit after tax to £4.0m (2017: £3.0m)
- 31% uplift in diluted earnings per share to 18.52p (2017: 14.17p)
- 8% improvement in adjusted EBITDA1 to £5.5m (2017: £5.1m)
- Sales of £28.3m (2017: £29.2m)
- Proposed final dividend of 5.0p (2017: 4.5p) per share, total dividend for the year 7.2p (2017: 6.5p) an increase of 11%
- Cash balances of £12.9m at the year-end (2017: £13.6m)
Operational highlights
- Strong sales growth in US, Europe and Australasia markets
- New subsidiaries were incorporated in Mexico in 2018 and post-year end in Turkey
- Launch of
- Next generation of mycotoxin binders branded Anpro®
- Omega 3 supplement delivering improved fertility benefits to dairy farmers
Peter Lawrence, Chairman, commented:
“Trading in the current year is ahead of the same point in 2018. However, we remain vigilant as there may be obstacles ahead due to Brexit and African Swine Fever, in particular. Our strong balance sheet and cash generation capability provide Anpario with a firm platform from which to invest in new products and to develop the exciting Anpario Direct opportunity.
Expanding profitable sales and distribution channels around the world remains our priority and the initiatives already implemented are gaining traction. This gives me confidence that we will return to sales growth as 2019 progresses.”
1 Adjusted EBITDA represents profit for the period before tax £4.552m (2017: £3.403m) adjusted for: share based payments and associated costs £0.118m (2017:£0.259m); net finance income £0.087m (2017: £0.042m); depreciation, amortisation and impairment charges of £0.871m (2017: £0.825m) and exceptional items of £nil (2017: £0.627m).
Chairman’s statement
Anpario has delivered another good set of results for the year to 31 December 2018 with increases in pre-tax profit, earnings per share and EBITDA, when compared with the previous year. This outturn has been achieved in a challenging trading environment, which has held back sales The rapid spread of African Swine Fever (ASF) in China and the strengthening of the US dollar against currencies in which our customers trade, have influenced our performance but our focus on controlling costs whilst still implementing our development initiatives, has delivered encouraging results.
The proportion of total sales direct to end users continues to grow and reflects our strategic focus of working closely with our major partner distributors. The imminent launch of Anpario Direct, our internet sales channel, will take us into the small and medium sized farm enterprise segment. New investment in a fully automated liquid bottling plant and small packaging system, coupled with continued expansion of our regional commercial teams, will offer farming communities both an efficient and effective multi-channel service.
Profit before tax rose strongly by 34% to £4.6m (2017: £3.4m). Basic earnings per share increased by 33% to 19.53 pence per share (2017: 14.66 pence) and diluted earnings per share increased by 31% to 18.52 pence per share (2017: 14.17 pence). The Board is recommending a final dividend of 5.0 pence per share (2017: 4.5 pence) making a total of 7.2 pence per share for the year (2017: 6.5 pence), an increase of 11%. More detail of the financial performance of the Group is contained in the Financial Review that follows this statement.
Operations
The UK and Europe delivered a strong performance with sales growth of 9% compared with the same period last year. The recovery in milk prices helped strengthen demand for our mycotoxin binder range. Optomega Plus, our sustainable omega 3 supplement, that helps improve fertility in dairy cows, has been adopted by a number of dairy operators. Optomega Plus is also used as a supplement for enriching eggs with omega 3, bringing health benefits to human consumption.
Brexit
Anpario’s products and processes comply with the required European Union regulations. In the event of the UK leaving the EU, we have plans in place with our EU suppliers to try to minimise any disruption. These arrangements include increasing raw material stock levels in the UK and supporting our European distributors with additional stock, which may increase working capital and storage costs, but this should not be material.
Outlook
Trading in the current year is ahead of the same point in 2018. However, we remain vigilant as there may be obstacles ahead due to Brexit and African Swine Fever, in particular. Our strong balance sheet and cash generation capability provide Anpario with a firm platform from which to invest in new products and to develop the exciting Anpario Direct opportunity.
Expanding profitable sales and distribution channels around the world remains our priority and the initiatives already implemented are gaining traction. This gives me confidence that we will return to sales growth as 2019 progresses.
Peter Lawrence
Chairman
6 March 2019