Friday 22 November 2019

United Drug unveils plan to double in size by 2017

Liam FitzGerald, chief executive of United Drug, told investors at a presentation in London yesterday the company was now an international healthcare group, headquartered in Ireland.
Liam FitzGerald, chief executive of United Drug, told investors at a presentation in London yesterday the company was now an international healthcare group, headquartered in Ireland.
John Mulligan

John Mulligan

Healthcare firm United Drug plans to double the size of its business over the next five years, the company has told investors.

Management including chief executive Liam FitzGerald laid out the plan at a presentation to investors in London.

The detailed strategy came in advance of United Drug's move to shift its listing from Dublin to the UK capital in an effort to raise the profile of the business and shareholder interest in it.

Mr FitzGerald told investors that there has been a "significant change" in United Drug's business, from being an Irish-centric distributor to an international healthcare services group that is headquartered in Ireland. But he said there has been "limited investor understanding" of the company's transition and limited coverage of its activities by analysts.

United Drug has consistently been trying to preach its reduced reliance on the Irish market, where it has a significant drugs wholesale business.

But just 25pc of the company's profits were expected to be generated in Ireland in its 2013 financial year, with 41pc from the UK and 30pc from the US.

The company has been highly acquisitive in recent months, deepening its presence in the US and in other territories outside Ireland.

Mr FitzGerald said that management want to double the size of the group over the next five years through performance-led growth.

He added that they also intend to "increase the pace of internationalisation" of the group, which hints at continuing acquisitions.

Growth

The company has said it's looking at growth opportunities in the US, Japan, Spain and Canada for some of its business.

United Drug is likely to rely on acquisitions to provide half the growth momentum that's needed to double the size of the business within the target time.

United Drug has already confirmed that it's to delist its stock from Dublin after being on the Irish exchange since 1986.

It believes a London listing will gain it more investor exposure.

The move is likely to take place before Christmas.

United Drug generated 41pc of its €77m operating profit in the UK during the 12 months to the end of September last year and 26pc of its €1.74bn of revenue.

Davy stockbrokers analysts Jack Gorman yesterday described United Drug's growth targets as "ambitious".

"Given current year earnings growth, and if the broader earnings targets are achievable, then United Drug is returning to a growth cycle," he said.

Irish Independent

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