StockMarketWire.com - Veterinary pharmaceutical products and services supplier Animalcare's operating profits fell by 24% to £1.09m in the six months to the end of December.

Pre-tax profits fell by 21% to £1.09m and revenues were down by 10% at £5.40m.

The group said first half revenues reflected the temporary supply disruptions with its key product, Buprecare, and reductions in sales volumes in microchip identification products and related services.

But is said sales excluding Buprecare increased by 14% compared to the same period last year, driven by new product introductions licensed veterinary medicine.

Basic underlying earnings per share from total operations of 4.7p (2010: 5.0p) have been supported by a change in the sales mix towards higher margin veterinary medicines, good overall cost management and benefit in the current period of research and development tax credits reducing the effective tax rate.

Cash generation from operations remained strong at around £1.3m and the group's net cash position has improved to £1.75m as at 31 December 2011 (2010: £0.43m).

The interim divided of 1.5p per share is 50% up on last time.

Chairman James Lambert said: "During the first six months of this financial year we have overcome the temporary loss of supply of one of our key products, Buprecare ampoules.

"Reduced consumer confidence is however significantly affecting our companion animal identification business, but the strength of our portfolio of licensed veterinary medicines continues to deliver growth greater than the overall market.

"Whilst the second half of the year presents challenges, the Board believes that overall trading for the full year will be in line with market expectations."




At 8:20am: [LON:ANCR] share price was +1.5p at 155.5p



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