Dechra Pharmaceuticals raised its dividend by 15.1 per cent as the company achieved higher revenues and profits during the second half of 2012.

The veterinary medicines company returned an interim dividend per share of 4.34p, compared to 3.77p for the same period a year earlier.

Group revenues climbed 20.4% year-on-year to £252.2m for the half year while profits before tax soared 29.25 to £11.5m.

Results were driven by strong performance of licensed branded veterinary products in specialist pet diets in key segments in Europe and the US.

Contract manufacturing saw double digit sales growth while the group's services segment realised solid revenues and a modest improvement in operating margin.

Dechra began to see rewards from the successful integration of Eurovet Animal Health which the company acquired last May. Eurovet is a Netherlands-based business which operates in the companion animal pharmaceuticals and farm animal pharmaceuticals markets.

"The first phase of the integration has progressed in line with our strategy and is delivering the expected cost and revenue synergies," the company said.

Net borrowings were up £102m at the end of the year, compared to £87m at June 30th and £46.1m at the end of 2011.

Operating profits jumped 37.3% to £15.1m while basic earnings per share increased 6.9% to 9.91p.

The firm's outlook for the year ahead was positive as trading was expected to remain robust. However, the company said it was cautious given the economic environment, particularly in European markets.

Dechra said bad weather also hit sales in the service sector in January but anticipates the segment will bounce back.

"The group continues to deliver its strategic objectives; with additional synergies from the Eurovet acquisition, new product introductions, improved efficiency and international expansion we remain well positioned to maintain our strong growth."

RD

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