CVS Group PLC (LON:CVSG) has bounced back strongly after a troubled start to the year caused by a shortage of vets.
Richard Connell, chairman, is also confident it can withstand any Brexit pressures pointing out the veterinary sector has been “resilient” in past periods of economic downturn, and the risk of supply shortages is small given that pharmaceutical manufacturers have increased stock levels.
The group tends sickly pets at its 510 surgeries across the UK, the Netherlands and Ireland and has been one of AIM’s best performers in the last few months as the trading outlook has improved.
After sliding on a profit warning in January, a trading update in July mollified investors and CVS today confirmed the recovery with sales up 24% year-on-year to £407mln and a 15% rise in underlying profits at £54.5mln.
Before-tax profit dipped 17% over the year to £11.7mln, down from £14.1mln the year due to higher amortisation and acquisition costs.
CVS acquired 34 surgeries over the financial year.
Analysts at Peel Hunt repeated their ‘Buy’ rating, and set a target price of 1050p, saying that veterinary businesses are “predictable and cash generative”, making them an attractive long-term investment.
Traders had a bounce in their step on Friday morning with shares jumping 8% to 979p.