The contrast is striking. While the title Vetoquinol collapsed by 11.02% in reaction to a turnover of the first quarter below expectations, the action of its competitor Virbac jumped by 7.6% Monday morning, to 374 euros, leading the SRD. At 318 million euros, the income of the Nice animal health pharmaceutical laboratory increased by 19.3% as of March 31, of which 16.2% organic.
The performance, which exceeded financial analysts’ expectations, was driven by a favorable monetary context – in particular the appreciation of the dollar, the Indian rupee and the Brazilian real –, a favorable base effect and the dynamics of the branch dedicated to pets. Accounting for 58% of total activity, it saw its revenues increase by 22.3% (+19.5% at constant rates) thanks to the ranges pet food, specialties, dermatology and hygiene, and the range of vaccines for dogs and cats. The food producing animal segment also posted good growth of 16.9% at real rates (+13.3% at constant exchange rates), mainly driven by the ruminant and aquaculture sectors. ” Unlike Vetoquinol, volumes are very strong, if we consider that the price effects at Virbac are close to 3-4% over this quarter given the increases in 2021 », Analyzes the expert from Oddo BHF.
Accessible objective
From a geographical point of view, growth is driven by the Asia-Pacific region, in particular Australia and India, where sales jumped 80%. Enough to compensate for the slowdown in China, where the upsurge in cases of Covid-19 contamination is paralyzing activity. In Europe, the United States and Latin America, growth was measured in double digits (+11.2% and +35.6%), with the exception of Chile, which grew by 9.5%
On the strength of this start to the year, Virbac is widening its annual growth range, now aiming for between 5% and 10% growth, against 5% to 8% previously. The other forecasts remain unchanged: a current operating margin before amortization of assets resulting from acquisitions of around 15% at constant exchange rates, reflecting voluntary overinvestment of around 1% of sales, inflation and strains on supply chains. the free cash flow should be around 60 million euros excluding dividends. ” To reach 10% in 2022, Virbac must grow by just over 6% over the next three quarters, which seems accessible to us given the price increases (more than 2% estimated) and the historical growth of the veterinary market. (+4% estimated) “, calculates Oddo BHF.
PC