Advanced Medical Solutions shares manage gains on 2018 growth

Surgical and advanced wound care specialist company Advanced Medical Solutions Group reported a 6% rise in its revenues in its preliminary results on Wednesday, to £102.6m, and by 7% at constant currency.

The AIM-traded firm said branded revenues were ahead 12% to £62.1m in the year ended 31 December, and by 13% at constant currency.

Original equipment manufacturer (OEM) revenues slipped 3% to £40.5m, and by 2% at constant currency.

Advanced Medical Solutions said its adjusted operating margin was up 180 basis points to 28.0%, while its adjusted profit before tax improved 14% to £28.9m.

It reported continued strong performance from its ‘LiquiBand’ topical tissue adhesives, with sales up 22% to £31.7m, and by 24% at constant currency.

US revenues were 26% higher at £23.0 million, and by 30% at constant currency, while its market share by volume advanced by 2% during the year.

There was said to have been “strong growth” in its internal adhesives operation, following the relaunch of ‘LiquiBand Fix 8’ laparoscopic in the second quarter and the soft launch of the open device in the fourth quarter.

Sales increased 21% to £2.1m at both actual and constant exchange rates.

Advanced Medical Solutions said sales of collagens and other biosurgical devices increased by 8% to £8.6m, and by 6% at constant currency, while sales of sutures were impacted by regulatory challenges, rising 1% at reported and constant currency to £13.3m.

Antimicrobial dressings were 1% higher at £19.6m, and 2% at constant currency.

Post-period end, in January, the company announced the acquisition of Sealantis for $25m (approximately £19m) in cash, with royalties due on product sales until 2027.

It said the acquisition would give it the technology platform and products to enter the $1bn internal sealants market, with the first product expected in the the European market in the first half of 2021, and multiple potential additional sealant products.

The board also highlighted the appointment of Eddie Johnson as its chief financial officer and a board director on 1 January, following the retirement of Mary Tavener following 19 years of service.

Advanced Medical Solutions proposed a final dividend of 0.90p per share, making a total dividend for the year of 1.32p per share, which was up 20% year-on-year.

“2018 was AMS's 17th consecutive year of growth with strong financial and strategic progress across the group,” said chief executive officer Chris Meredith.

“Our solid revenue growth was driven by sales in our branded division which included LiquiBand topical tissue adhesives further increasing market share a further 2%, and the growth of our internal adhesives and biosurgical devices.”

Meredith said the company had further reaffirmed its commitment to innovation through the acquisition of Sealantis, which now opened up the large internal sealants market for the group.

“We are well positioned to take advantage of market opportunities across our product portfolio, and we continue to actively review merger and acquisition opportunities.”

As at 1454 GMT, shares in Advanced Medical Solutions Group were ahead 0.49% at 307p.