CVS Group PLC has released its full year trading update for the financial year ended 30 June 2024, highlighting a 10% revenue growth for its continuing operations, with like-for-like sales increasing by 2.9%. The company reported that revenue growth and like-for-like sales were impacted by the transitory effect of a cyber incident and the resulting decision to accelerate cloud migration across the majority of the Group's companion animal practices in the UK. Adjusted EBITDA margin for continuing operations is expected to be at the lower end of the stated range of 19% to 23%, with an estimated Adjusted EBITDA of approximately £127m.
The company also provided an updated capital allocation policy, focusing on maintaining operational cash conversion, investment in overseas acquisitions, capital expenditure, and leverage. In FY25, CVS Group PLC expects to continue focusing its capital allocation towards its Australia opportunity, aiming to drive long-term sustainable growth.
CVS Group PLC continued to invest in practice facilities, clinical equipment, and technology, with total capital expenditure of approximately £42.0m in FY24. The company also made significant acquisitions in Australia, completing ten acquisitions of small animal first opinion practices, bringing the total to 23 acquisitions comprising 30 practice sites. Additionally, the Group completed five acquisitions of small animal practices in the UK in FY24, comprising six practice sites.
The company also addressed the cyber incident and investment in IT infrastructure, stating that it brought forward capital expenditure for IT and related infrastructure due to the rollout of a new practice management system. Net bank borrowings as of 30 June 2024 were £168.0m.
Overall, CVS Group PLC's trading update, business developments, and board changes reflect its strategic focus on revenue growth, capital allocation, and expansion in both the UK and Australia markets.