Abano achieves second year of 75% profit growth

Abano Healthcare 12-month price history (NZX.com)

Abano Healthcare [NZX: ABA], the medical investor fending off a hostile takeover from its biggest shareholder, posted a 75 percent jump in full-year profit, beating guidance and allowing it to maintain dividend payments for a sixth straight year.

Net profit jumped to $4.9 million in the 12 months ended May 31, from $2.8 million a year earlier, the Auckland-based company said in a statement. Underlying profit, which excludes one-time items and accounting adjustments, climbed 35 percent to $6.1 million. Sales climbed 2 percent to $211 million.

That's the second year in a row that profit has climbed 75 percent and the company said today it expects to list earnings again in 2015, allowing it to lift dividends starting in the first half of the current year. The shares rose 1.5 percent to $6.15 and are rated a 'buy' based on two analysts who follow the stock, having declined about 3.5 percent this year while the nation's benchmark stock index gained.

Abano's trans-Tasman dental business was the biggest contributor to revenue growth in the latest year, along with the company's Australian audiology joint venture and it said today that "growth through acquisitions is still the key focus for the dental sector as we build scale in this very large and attractive market."

"The increasing size of the dental group is providing a stronger negotiating position with suppliers and more economies of scale are being achieved," it said.

The weak Australian dollar had eroded returns from dental, slicing about $14.3 million off gross revenues and $1.8 million off underlying Ebitda, versus a year earlier. Abano's Bay Audio Australian joint venture reduced its losses in the latest year while its Bay Audio Asia group "is still focussing on achieving a monthly Ebitda breakeven performance," the company said.

Abano will pay a final dividend of 13.7 cents a share, making 21 cents for the year, with a record date of Aug.11.

At a special meeting on June 13, dissident shareholders Peter Hutson and James Reeves lost in an attempt to oust chairman Trevor Janes, who has led opposition to their takeover attempts. Hutson and Reeves control close to 20 percent of the company.

Hutson owns the other 50 percent of Abano's Bay International audiology business and would have gained full control for a nominal sum under last year's aborted takeover. He was removed from the board last September.

(BusinessDesk)


Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7327 0.0000 0.00%
AUD 0.9211 0.0000 0.00%
EUR 0.6140 0.0000 0.00%
GBP 0.5434 0.0000 0.00%
HKD 5.7285 0.0000 0.00%
JPY 82.1000 0.0000 0.00%

Commods

Commodity Price Change Time
Gold Index 1293.3 6.130 2017-09-22T00:
Oil Brent 56.4 0.420 2017-09-22T00:
Oil Nymex 50.7 0.110 2017-09-22T00:
Silver Index 16.9 -0.034 2017-09-22T00:

Indices

Symbol Open High Last %
NZX 50 7795.4 7814.8 7795.4 0.25%
NASDAQ 6401.4 6429.5 6422.7 0.07%
DAX 12569.7 12646.6 12600.0 -0.06%
DJI 22334.1 22364.3 22359.2 -0.04%
FTSE 7263.9 7320.3 7263.9 0.64%
HKSE 27949.8 27960.9 28110.3 -0.82%
NI225 20413.6 20417.1 20347.5 -0.25%
ASX 5655.4 5688.2 5655.4 0.47%