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magazineAlliance Pharma's growth potential remains underappreciated
Alliance Pharma (APH:AIM) 104p
Gain to date: 45.3%
Original entry point: Buy at 71.6p, 3 October 2019
Pharmaceutical specialist Alliance Pharma’s (APH:AIM) recent first-half results (21 Sep) demonstrate the strength of the business with like-for-like revenue growth in the consumer healthcare division (70% of the business) and prescription medicines division both up 12% year-on-year.
The star performer in the first half was scar prevention and treatment brand Kelo-cote which saw like-for-like revenues up 62% driven by strong demand in China.
The increasing propensity of Chinese customers to buy their health products online was a key driver and the company estimates that the market has the potential to grow by a compound annual growth rate of 17% a year out to 2025.
The company signed a new distribution deal in August which it said gets it closer to the customer and provides greater control of its distribution chain in China.
The 2020 Amberen acquisition has been fully integrated and is delivering in line with management expectations. After launching the Perimenopause treatment in June, the company’s market share has doubled to 7%, demonstrating the potential US opportunity.
SHARES SAYS: We believe that Alliance Pharma’s growth potential remains undiminished while the shares still trade
at a discount to peers according to Numis.
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Issue contents
Editor's View
Feature
Great Ideas
- China exposure is a key risk for Lindsell Train Equity Fund
- Alliance Pharma's growth potential remains underappreciated
- Why this Japanese trust has gained 15% in a month
- Close to 50% gain from Equals since April, more to come?
- Want Asia exposure but worried about China? Try Vietnam
- A brighter outlook for property makes this 5% yielding trust a bargain
