Abcam lifts interim dividend as first half revenue is boosted by rabbit antibody

The group's first half revenues were driven by demand for RabMAb, a suite of rabbit monoclonal antibodies

Abcam's shares rallied after reporting an increase in first half earnings

Abcam plc (LON:ABC), which manufactures antibodies used in clinical research, has raised its interim dividend 20% after achieving first half growth in earnings and revenue.

Adjusted pre-tax profit rose to £32.1mln in the six months ended 31 December 2016 from £24.3mln in the year-ago period.

Total revenue jumped to £102.5mln from £78.6mln, driven by 50% growth in sales of RabMAb, a suite of rabbit monoclonal antibodies. A 37.1% increase in non-primary antibody revenues and a weaker sterling following the Brexit vote last June also boosted results as its businesses are mostly based outside the UK.

The company recorded an increase in revenue across all its regions including the Americas, the Europe, Middle East and Africa area, Japan, China and the rest of the Asia Pacific.

Underlying earnings (EBITDA) margin rose to 35.1% from 34.5% on an adjusted basis, helping to lift EBTIDA to £35.9mln from £27.1mln.

The group raised its dividend to 2.825p from 2.354p.

“We are pleased to have delivered double-digit sales growth and our profit goals in the first half,” said chief executive Alan Hirzel.

“We continue to invest in our teams, our systems and our facilities to allow us to grow; and, as we look to the traditionally stronger second half of this financial year, we remain confident in our long-term strategy and the progress we are making in achieving our annual goals."

Shares gained 6.32% to 933.5p in early trading.

Peel Hunt said it remains confident Abcam will likely exceed its forecasts for fiscal year 2017, which include EBITDA of £73.5mln on sales of £218.4mln.

The broker reiterated a ‘hold’ rating and target price of 750p, saying the stock trades at  33 times calendar year 2017 price-earnings ratio versus a life science consumables universe of 24 times. 

Quick facts: Abcam

Price: 1282 GBX

Market: AIM
Market Cap: £2.64 billion

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