Uniphar confirms strong outlook on steady M&A pipeline

Uniphar shares declined 2.3% to 310p in late afternoon trading on Tuesday after the group confirmed an EBITDA and gross profit performance in line with management expectations in its HY1 trading update.

The healthcare services company reported a gross profit rise of 5%, driven by organic growth across each sector and outperformance in its Supply Chain and Retail segment.

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Uniphar highlighted a normalised free cash flow conversion in line with medium term guidance and a strong liquidity position, despite macro-economic pressures.

The firm said it remained focused on is strategy of building a pan-European presence across its Commercial and Clinical business, and completed three acquisitions in 2021 to advance its ambitions in the region.

The group confirmed its integration of BETMSLs, CoRRect Medical and E4H were progressing according to schedule, and reported a targeted mid-to-single digit organic growth in gross profit in the segment for the medium term.

Meanwhile, Uniphar commented its Product Access platform delivered mid-to-single digit organic growth over the period, with similar expectations for the FY and targeted double-digit growth in the medium term.

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The company added the integration of its Devonshire acquisition from 2021 was ongoing and making good progress.

Uniphar confirmed its acquisition of Navi Group for its Supply Chain and Retail business was expected to close later in 2022. The group highlighted a target of low-to-single digit organic growth in gross profit across the medium term for the sector.

FY 2022 guidance

The firm commented its outlook remained strong, with M&A continuing to play a key role in its compounding growth strategy, while maintaining a disciplined approach to capital allocation.

“The Group has performed strongly during the period. The resilience of our business model and the diversity of our product offering has once again been demonstrated with each division delivering organic growth in gross profit during the period,” said Uniphar CEO Ger Rabbette.

“Once again, our Supply Chain & Retail division has outperformed its medium-term guidance demonstrating the benefits of our market leading position and the importance of continued investment in this division.”

“While the macro-economic environment remains uncertain, we have been successful in using our scale and deep relationships with our long-term partners to mitigate inflationary headwinds. We remain confident and are on track to achieve our strategic objective of doubling EBITDA within 5 years of IPO.”

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