"The three areas of the business have performed well during the year; in particular the continued growth of Licensed Veterinary Medicines"
Animalcare remains focused on three product groups: Licensed Veterinary Medicines, Companion Animal Identification and Animal Welfare Products; all sold through veterinary practices. The three areas of the business have performed well during the year; in particular the continued growth of Licensed Veterinary Medicines by 8.8% is very pleasing and follows a strong year in 2014.
Group revenues increased by 5.1% from £12.9m to £13.5m principally due to the growth in sales of Licensed Veterinary Medicines by £696k to £8.6m. This good performance has led to pre-tax profits increasing by 12.7% during the year and over 30% in the past two years. Basic earnings per share have increased from 10.3p to 12.1p, up 17.5% in the period and 33% in the past two years. Cash generation has remained very strong, with cash increasing from £3.8m to £5.8m.
The senior management of your business has been further strengthened during the year with high calibre individuals from the human and animal pharmaceutical industry. A Senior Management Team meeting made up of all the heads of departments is chaired monthly by our CEO Iain Menneer, setting and monitoring budgets, and running the business day-to-day.
The plc Board, which meets eight times a year, is chaired by myself as Non-Executive Chairman, having held CEO and Chairman roles for thirty years. Nick Downshire also has wide business experience and is a qualified accountant and chairs the Audit Committee. Ray Harding is a qualified veterinary surgeon and set up and ran a successful pharmaceutical regulatory consultancy for fifteen years and is Chairman of the Remuneration and the Nomination Committees. Along with the CEO and CFO your Board sets the strategy to enhance shareholder value in all three main operating areas of the business. I believe the success and the long-term growth of Animalcare are well served by a stable, experienced, well balanced and challenging Board. This coupled with an able, talented hard working management team gives your Company real opportunity for continued growth over the coming years.
Product Development Pipeline
Progress has been made during the period developing new products in our in-house development pipeline. Our investment in product development and in regulatory assessment fees has grown significantly during the year to almost £800k, an area which is core to our growth strategy. Further information is available on the Strategy page.
Your Board proposes, subject to shareholder approval, an increased final dividend of 4.3 pence per share. With 1.8 pence per share paid as the interim dividend this brings the total for the year to 6.1 pence per share, representing growth of 10.9% (2014: 5.5 pence per share), which is in line with underlying operating profit and is well covered by the increase in cash balances.
With the significant increase in investment in new product development and in the infrastructure across all areas of its business, Animalcare is well positioned and delivering its strategy for growth in sales from 2017 onwards. Your Company possesses not only an experienced, talented and well balanced leadership team but also a capable hard working workforce. I would like to thank them all for their commitment during the year, which continues to deliver an exciting growing business.