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Uniphar shares buoyed by spike in virus demand

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Trading update: A pharmacy in Rathmines. Uniphar is committed to keeping pharmacies supplied during the coronavirus outbreak

Trading update: A pharmacy in Rathmines. Uniphar is committed to keeping pharmacies supplied during the coronavirus outbreak

PA

Trading update: A pharmacy in Rathmines. Uniphar is committed to keeping pharmacies supplied during the coronavirus outbreak

Shares in diversified healthcare services group Uniphar rose as much as 7pc yesterday after it said it was performing "ahead of expectations" so far this year.

The company is benefiting from a recent "significant spike" in demand across all of its three divisions, as Government and the wider healthcare sector ramp up Covid-19 related work.

It expects increased demand to continue across the group as it prepares for the full impact of the coronavirus crisis in the next 12 weeks, according to a trading update.

However, this will likely increase costs as it invests in additional resources to manage higher volumes.

The company is also preparing for a possible delay in medical device revenue, if certain "non-urgent" elective surgeries have to be postponed. Such a delay, were it to last three months, could have a one-off impact of €5m on earnings.

Ger Rabbette, Uniphar CEO, said: "We are closely monitoring the development of the Covid-19 situation.

"We are focused on the key role our organisation plays in ensuring patients have access to life-saving medicines, and on anticipating and overcoming the challenges which face us all in the coming weeks and months."

Uniphar, which raised €150m from its IPO last year, said it had a "strong" capital structure in place, with significant cash resources available.

At the year-end December 31, it held a net cash position of €26m, made up of €116m of cash and cash equivalents, and €90m of bank debt.

In addition to this, it has undrawn committed and uncommitted facilities of circa €55m. Analysts said the company's balance sheet was in "stellar shape".

Allan Smylie, of Davy Stockbrokers, said Uniphar's stock price was "absurdly cheap given its defensive model and net cash balance sheet".

The company will release its full-year results for 2019 on Friday.

Elsewhere, drug firm Amryt Pharma, which is focused on finding treatments for rare conditions, said its revenues last year grew 13pc to $154m (€143m).

The impact of Covid-19 to date on Amryt's business has been minimised, it said in a trading update.

It added that it does not anticipate significant changes to its existing revenues as a result of the deadly virus.

At the end of December, the company had $65m, with no debt facilities due to mature before September 2024.

Irish Independent