Abano forecasts FY sales growth up to 1.3 percent , jump in net profit

Tuesday 26th March 2013

Abano Healthcare Group, which invests in specialty health clinics, forecasts growth in full-year sales and profit driven by the expansion of its dental business. The shares rose 3.8 percent.

Sales are forecast at $207 million to $209 million for the 12 months ending May 31, from $206.4 million a year earlier, the Auckland-based company said in a statement. Underlying profit, which excludes one-time items and accounting adjustments may rise to $4.1 million to $4.6 million, from $3 million in 2012, while net profit is seen in a range of $2.3 million to $2.8 million, up from $1.6 million.

The company sold its Abano Rehabilitation unit in June last year and this year has focussed on expanding in dentistry with the acquisition of 22 practices bringing the total in its trans-Tasman network to 139. It has three more expected to settle before the financial year end though several more have been pushed over into next year.

"The dental businesses remain the primary revenue generators for Abano with same-store sales continuing to grow in New Zealand, buoyed by the ongoing Lumino television campaign," managing director Alan Clarke said in a statement. "Australia has seen a slowing in growth in line with the softening Australian economy."

Interest in joining Abano's dental network "remains strong, with a solid pipeline of acquisitions planned," he said.

The company's audiology clinics in Australia and Southeast Asia are still forecast to be breakeven on an earnings before interest, tax, depreciation and amortisation basis in two or three years' time, it said

Abano confirmed it will pay dividends for 2013 of 21 cents a share.

The shares rose 25 cents to $6.80, the highest since August 2009, and have advanced 57 percent in the past 12 months. The stock is rated a 'buy' based on two recommendations tracked by Reuters, with a median price target of $7.105.

BusinessDesk.co.nz

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