CVS Group (CVSG) H2 2024 earnings summary

Executive summary

• Achieved 9.9% revenue growth to £647.3m and 4.7% adjusted EBITDA growth to £127.3m, driven by acquisitions and organic growth, with strong performance in the UK and successful entry into Australia.

• Completed 27 acquisitions for £95.2m, including 22 in Australia (28 sites) and 5 in the UK, while divesting loss-making businesses in the Netherlands and Ireland.

• Continued investment in clinical facilities, technology, and people, including migration to a new practice management system and recruitment of 170 new graduate vets.

• Proactive engagement with the UK CMA investigation and managed headwinds from a cyber incident and operational disruptions.

• Focused on core operations and long-term growth, supported by a disciplined acquisition strategy.

Financial highlights

• Revenue increased by 9.9% year-over-year to £647.3m, with like-for-like growth of 4.1% (2.9% underlying, adjusted for cyber disruption).

• Adjusted EBITDA rose 4.7% to £127.3m, with a margin of 19.7% (down 0.9ppts year-over-year).

• Spent £95.2m–£97.0m on acquisitions and £43.1m on capital expenditure for technology and clinical equipment.

• Free cash flow was £62.0m, with operating cash conversion at 70.5%.

• Adjusted EPS was 86.6p (down from 98.9p), and final dividend increased to 8.0p.

Outlook and guidance

• On track to double adjusted EBITDA over five years, with FY 2025 results expected in line with market expectations.

• Confident in medium to long-term growth, supported by a strong acquisition pipeline in Australia and continued investment in technology and people.

• Further acquisitions anticipated to be additive to performance, with margin target of 23% supported by maturing acquisitions and Australian operations.

• Healthy balance sheet and free cash flow support further investment; leverage expected to remain below 2x.