Masterpet helps lift Ebos profit 19pc

Expanding into pet products last year has helped Ebos post a 19 per cent lift in annual profit. Photo / Doug Sherring

Ebos Group, the medical equipment and consumables distributor that expanded into pet products last year, is targeting growth in its animal health business after the acquisition of the Masterpet business helped lift annual profit by 19 per cent.

Net profit from continuing operations rose to $27.9 million, or 53.6 cents per share, in the 12 months ended June 30, from $23.4 million, or 45.4 cents, a year earlier, the Christchurch-based company said in a statement. That was just ahead of the consensus forecast of $27.1 million, or 52 cents per share. Including Ebos' scientific business, which was sold last year, net profit fell 12 per cent.

"Our Masterpet acquisition is fully meeting expectations and has made a welcome addition to group profitability," the company said.

"Our core healthcare business once again demonstrated the merit of our diverse business model operating across multiple touchpoints in healthcare."

The shares fell 1.2 per cent to $7.95 in trading after the announcement, and have gained 21 per cent this year. The stock is rated an average 'buy' based on two analyst recommendations compiled by Reuters.

Total revenue rose 6.3 per cent to $1.43 billion, in line with the consensus forecast of $1.44 billion. The healthcare unit contributed $1.34 billion and the animal care business $86.4 million.

The healthcare unit's earnings before interest, tax, depreciation and amortisation fell 11 per cent to $36.7 million, while the animal unit's ebitda was $10.1 million.

The Masterpet acquisition was projected to add about $170 million of revenue and $20 million of ebitda in the first full year ending June 30, 2013.

"As signalled at the half year, we will be looking to Masterpet and other opportunities in the animal health sector to provide some income growth," the company said.

The healthcare unit faced a short-term cap on growth and increasing margin pressure as the sector undergoes significant reform on both sides of the Tasman, Ebos said.

The board declared a fully-imputed final dividend of 20.5 cents per share, payable on October 5. That takes the annual payment to 34 cents per share, or $17.7 million.