Cello Health reports positive momentum as it works on US market

Healthcare-focussed advisory firm Cello Health reported a 6.8% improvement in net revenue to £54.5m in its half-year results on Wednesday, with its like-for-like constant currency net revenue growth standing at 4.5%.

The AIM-traded company said Cello Health divisional net revenue growth was 11.6%, with like-for-like constant currency growth there being 8.2%.

Cello Signal divisional net revenue declined 0.1%, however, with like-for-like constant currency revenue in that division declining 1.0%.

The firm’s headline profit before tax was ahead 12.7% year-on-year for the six months ended 30 June to £5.7m, while its headline operating margin improved to 10.9%, from 10.4% a year earlier.

Headline basic earnings per share were 12.7% higher at 4.08p, compared to 3.62p last year.

On a statutory basis, profit before tax was 39.7% higher at £4.7m, and basic earnings per share rose 40.3% to 3.31p.

The board reported “strong” cash flow for the period, with net funds as at 30 June standing at £2.2m, swinging from net debt of £5.4m a year prior.

It declared a 4.5% improvement to the interim dividend, to 1.15p.

On the operational front, Cello described “strong” growth across Cello Health, particularly in the United States, and added that its new Berlin office was now fully servicing European clients.

It added that the acquisition of ISS in August, post period end, further strengthened Cello Health's US advisory capability.

“The first half of 2019 has continued to see strong growth from Cello Health, notably in the US market,” said chief executive officer Mark Scott.

“Cello Health Communications and Cello Health Consulting have made particularly pleasing progress.”

Scott said the addition of ISS in August would help contribute to that momentum, and had added “critical” regulatory expertise.

“Good revenue visibility for the remainder of the year gives us confidence for a strong full year outcome.”