(Adds details, executive comments, share price)
By Roshni Menon
May 14 (Reuters) - With more than 100 million euros in its war chest, UDG Healthcare Plc is seeking acquisitions to expand its contract outsourcing and healthcare communications business, company executives said on Thursday.
The business, already the biggest contributor to the Dublin-based company’s operating profit, publishes case studies, magazines and provides public relations services in the medical business.
“The healthcare communications market is still very fragmented so there’s some very nice opportunities to consolidate,” UDG Chief Operating Officer Brendan McAtamney told Reuters. “We will look to add complementary assets.”
McAtamney was speaking after UDG reported a 19 percent jump in first-half adjusted operating profit. The company also raised its full-year adjusted earnings per share growth forecast to 7-9 percent at constant currency.
It had earlier forecast a 5-8 percent rise for the financial year ending Sept. 30.
Though some of the world’s top healthcare communications companies are from the stables of advertising majors such as Omnicom Group Inc and Publicis Group SA, there are many small, privately owned players in the market.
UDG bought three of them last year, following up its $144 million purchase of KnowledgePoint360 in February with a smaller deal in July for specialist PR companies Galliard and Nyxeon.
These acquisitions contributed to a 35 percent jump in first-half revenue at Ashfield, the unit of UDG that houses healthcare communications and contract outsourcing services such as nurse educators, telesales and event management.
McAtamney said that UDG could also make bolt-on acquisitions in contract outsourcing in those countries where it is not already a market leader.
UDG, a 67-year-old company once known as United Drug, posted an adjusted operating profit of 53.6 million euros ($60.9 million) for the six months ended March 31.
The weaker euro also helped. The euro has depreciated 15 percent against the dollar and 7 percent against the pound in the first half of UDG’s financial year.
UDG reports in euros but makes about 70 percent of its profit in pounds and dollars.
The company increased its interim dividend to 2.90 cents per share from 2.69 cents per share a year earlier.
UDG’s shares gained 43 percent in the six months to March 31 and a further 14 percent to Wednesday’s close. They were largely unchanged at 539.5 pence at 1200 GMT. ($1 = 0.8799 euros) ($1 = 0.6330 pounds) (Editing by Robin Paxton)