- Veterinary company CVS said it expected to post a material boost in first-half adjusted earnings, driven by higher revenue and lower employment costs.

Revenue for the six months through December was seen rising 15%, or by 8.4% on a like-for-like basis.

Employment costs, which have hurt CVS in past results, were 51.0% of total sales, down from 51.6% on-year.

CVS said the reduction stemmed from a continued focus on the retention of clinical staff: the company's vacancy rate averaged 7.8% during the half, down from 8.7% on-year.

Gross margins edged back to 76.0%, from 76.2%, though the contraction was pinned on strong sales growth at the company's lower-margin online product dispensary business.

Turning to its outlook, CVS reiterated that comparatives would become more challenging in the second half of the 2020 financial year, given the improved performance seen in the second half of the 2019 financial year.

'The continuing positive trends in key performance indicators provide further assurance that the group is trading in line with management's expectations for the full year,' the company said.

CVS said that, thanks to a recent focus switch to organic growth, it had not completed any further veterinary practice acquisitions since three reported in its year-end results release on 27 September and the trading update on 28 November.

'The group remains focused on identifying and targeting acquisitions that are value enhancing and that complement its existing business,' it added.

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