Irish pharmaceutical and healthcare services group United Drug said they are looking to make acquisitions in the US, Britain, and Europe in the short term and hoping to expand into China and Brazil within five years.
Chief executive Liam FitzGerald said the company had a strong balance sheet after reporting a 7% increase in pre-tax profits for the six months to the end of March, to €35m. Operating profits also rose by 7% to €39.5m.
“The first half of 2012 has seen us advance our international healthcare services offering and return to good growth in profits and earnings while continuing to invest in our physical and IT infrastructure and management talent,” Mr FitzGerald said.
The company is eyeing up supply chain, packaging, and companies for acquisition in the US, UK, and Europe.
Mr FitzGerald said the company will remain an Irish company but continue to develop its international business. Overseas businesses now account for over 70% United Drug’s profits, with the US businesses contributing 25% of profits to March.
Mr Fitzgerald said that emerging markets would become a target for the company in the future.
“We have two small operations in Asia. At some stage we will have to expand in Chain and Brazil, but that will be in three to five years,” he said.
Mr Fitzgerald also said United Drug is focused on providing services to the approved drugs markets. He said the company is keen to offer services to pharmaceutical companies for their products that were still in the pre-approval phase.
Dónal O’Neill, an analyst with Goodbody stockbrokers, said United Drug’s cash generation was a little lighter than he expected, but despite this, he expects cash flow to improve considerably in the second half of the year.
He also reminded investors that the balance sheet remains very strong, leaving the group well placed to pursue accretive acquisitions.
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