viewCello Health PLC

Cello Health gains momentum as full-year profits and revenues rise


  • Two divisions: Cello Health and Cello Signal
  • The group's dividend has risen every year for the past 13 years
  • Expansion in the US is key to future growth
  • Suitable acquisitions are being mulled to speed this aim

Quick facts: Cello Health PLC

Price: 108 GBX

Market: AIM
Market Cap: £114.83 m


What Cello Health does:

Cello Health PLC (LON:CLL) calls itself a healthcare-focused advisory group.

It has two arms: Health, which provides expertise, processes, intellectual property and market knowledge spanning the pharmaceutical, biotechnology, diagnostics, healthcare equipment and consumer health sectors.

And Signal, which provides “digital, social media and branding expertise” to companies, and is increasingly focused on health having previously been focused sectors such as technology and retail.

Cello’s big claim to fame is that it works with 24 of the top 25 pharmaceutical companies around the world.

How it is doing:

For the year ended 31 December, the healthcare advisory firm reported a headline pre-tax profit of £13.1mln, up 6.6% on the prior year, while net revenues jumped 6.7% to £107.6mln.

Cello also reported that profit margins had risen to 19.3% from 18.5% in 2018 and that the year had seen an “ongoing expansion” of its pharmaceutical and biotech client base.

As a result, the company raised its full-year dividend by 6.5% to 4.1p per share.

Looking ahead, Cello said while it was “possible” that spending from some of clients may be disrupted by the coronavirus outbreak, most of its customer base was “dominated by clients which are traditionally less sensitive to short-term changes in consumer behaviour” and that they were “confident” of being able to trade effectively over the period.

“We enter 2020 with a good order book from 2019 and performance has been good in the early months of the year”, the company added.

“The strong revenue and profit growth achieved by the Group in 2019 reflects our focus on our professional structure and client offering, as well as excellent operational leadership”, said chief executive Mark Scott.

“We are very conscious of the uncertainty created by [coronavirus] and will continue to take appropriate cautionary measures to mitigate any impact, resulting from this, on the business. We remain confident of the long-term growth opportunity in the healthcare services arena", he added.

Inflexion points

  • In February, Cello reduced the consideration for the sale of its social media analytics business to Access Intelligence PLC (LON:ACC). Cello will make a cash payment of £1.6mln to correspond to a shortfall in the net assets of Pulsar Platform below the agreed target level at the closing of the deal, with Access Intelligence also buying back 4,076,238 of its own shares to reduce the purchase price for one pound. 

  • In October, Cello sold social media analytics business Pulsar to Access Intelligence PLC (LON:ACC) in exchange for £4.5mln worth of shares.

What analysts say

House broker finnCap said in a note in January that Cello was trading a a "discount to peers" and that its valuation multiples were "underpinned with good upside".

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Full interview: Cello Health reports good growth in profits and strong cash flow

Cello Health PLC's (LON:CLL) Mark Scott tells Proactive London they've seen good growth in profits and strong cash flow for the first half of the year said that he's confident about the rest of the year too. The group delivered net revenue of £54.5mln for the first six months of the year,...

on 18/9/19

3 min read