First-half profits at Newmarket-based Tristel beat forecast
Paul Swinney, Tristel chief executive, and Liz Dixon, finance director. Picture: Gregg Brown - Credit: Gregg Brown
Infection prevention products company Tristel has reported further growth in first half sales and profits, with export markets now accounting for 50% of revenues.
Tristel, based at Snailwell, near Newmarket, said turnover in the six months to December 31 grew by 10% compared with the same period a year earlier, from £9.748m to £10.727m with a 28% increase in overseas sales offsetting a 4% dip in the UK.
Pre-tax profits grew by 18% from £1.7m to £2.0m, despite regulatory costs of £500,000 associated with the company’s drive to enter the United States market, a result slightly ahead of the forecast in the company’s last trading update in December.
Paul Swinney, chief executive of Tristel, said: “We are very satisfied with overseas sales growth of 28% and with overseas revenues now accounting for one-half of all revenues.
“We have increased our pre-tax profit margin, before share-based payments, to 19% from 18% last year, even after costs of £0.5m incurred in the USA regulatory programme.”
He added: “We are progressing steadily with our planned entry into the North American hospital market having satisfied the additional data requirements of the EPA [the US Environmental Protection Agency]. A decision is expected from the EPA during the second half of this financial year. Our expectation continues to be that sales in North America will start next financial year.
“For many years we have been represented in Hong Kong by distributors and have now decided to employ our own team in this market. We expect the increased margin from selling directly to hospitals to exceed operational costs in next financial year. In the second half of this financial year, there will be an exceptional early termination payment to the distributor of approximately £0.2m.”
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Finance director Liz Dixon said that, with the exception of Hong Kong, most overseas markets had seen strong growth during the first half, including the company’s Australia, Germany/Central Europe and New Zealand subsidiaries and its UK-managed overseas distributors. The dip in UK sales reflected strategic changes in the product and customer mix, she added.
The interim dividend will increase by 14%, fro 1.4p per share at last year’s half-way stage to 1.6p.
