Vindon Healthcare - Vindon Healthcare news

VINDON Healthcare, the pharmaceutical services company, is gearing up for growth at home and abroad in the coming months.

The AIM-listed Oldham company said it would be opening a storage facility in Ireland in the summer and was close to signing a deal for a new £3m home in the north west.

The company revealed its plans as it announced its 2006 results, showing strong growth in turnover and profits. Sales rose from £3.1m to £3.8m while operating profits before goodwill increased 23 per cent, from £893,000 to £1.1m.

Vindon, which counts major pharmaceutical companies GlaxoSmithKline, AstraZeneca and Pfizer among its clients, provides products and services such as controlled environment rooms and storage chambers, blood bank storage units and plant growth chambers.

Chairman Liam Ferguson said he was pleased with Vindon's progress.

"We're optimistic about the move into Ireland. Demand is strong for storage facilities," he said.

Chris Barry ©MEN

Vindon Healthcare Year ended 31 December
2006 2005 Turnover 3,840 2,601
Pre-except profit 972 626
Pretax profit 849 499
EPS basic 0.70p 0.40p
EPS diluted 0.68p 0.40p
EPS adjusted* 0.84p 0.53p
Dividend n/av n/av
*before goodwill amortisation

LONDON (Dow Jones)--Vindon Healthcare said Tuesday that for the year ended Dec. 31 it made a pretax profit of GBP.85 million compared with GBP0.50 million.

The company said that year to date trading is buoyant with strong demand for in-house storage. Current order books and enquiry levels indicate that steady growth should continue to be achieved in the coming year.

It plans to continue as the UK's leading supplier to the pharmaceutical industry of controlled environment products. This sector is expected to grow steadily as Eastern Europe and the Far East markets develop.

In addition, the U.S. and Western European markets continue to expand as the age profile of their populations increase. There is clearly potential to export its products and services to these markets.

The company is currently expanding our product portfolio available to its Irish clients to encompass a dedicated in-house drug storage facility.

Recent regulatory changes which require pharmaceutical companies to widen the scope of stability storage trials into raw materials and "in - production" drugs should provide it with a great opportunity to expand both its storage and equipment supply service.

It remains confident of the long term future expansion of the group.

©2007 Dow Jones & Company, Inc.

Vindon Healthcare, through its operating subsidiary, Vindon Scientific, designs, manufactures and sells environmental control products to drug companies including Astra Zeneca, GlaxoSmithKline and Pfizer. An increasing proportion of its profits are derived from the provision of stability storage services to pharmaceutical R&D companies. Today’s prelims show continued growth in sales and profits. We expect demand for both Vindon’s equipment and services to continue to grow and are raising our FY07 forecasts and upgrading our recommendation to Outperform.

FY06 sales increased by 22% to £3.84m, ahead of our forecasts. PTP grew by an impressive 42% to £1.06m, in line with our forecasts.

The high level of order cover from the stability storage services contracts and sustained demand for Vindon’s equipment and services give us confidence to raise our FY07 sales estimate from £4.15m to £4.47m and our FY07 PTP estimate from £1.17m to £1.26m, giving annual PTP growth of 19%. We expect a similar (20%) level of profit growth in FY08, when we estimate sales of £5.22m generating PTP of £1.51m.

Demand for Vindon’s stability storage service is such that it has outgrown its site in Diggle, near to Oldham. Management intend to move all operations to larger premises in nearby Rochdale early in calendar 2008. This will give the potential to expand stability storage capacity by 600%. We are treating additional revenues associated with this move as upside.

Demand for Vindon’s products and services is likely to remain robust, its competitive position in the UK and Eire is strong and visibility of stability storage revenues is very high, indicating a P/E rating similar to other high quality engineering stocks such as Halma, Rotork and Spirax-Sarco. Our recent uplift in estimates justifies an upgrade in our recommendation from Market Perform to Outperform.

©WH Ireland