Description of CVS’ business

CVS Group Plc is one of the Leading veterinary services provider in the UK. The Group has four main business areas: veterinary practices, diagnostic laboratories, pet crematoria and Animed Direct, our online business. The passion of our people for animals and for making your pets our priority is at the heart of our work every day. CVS operates 256 surgeries, usually trading under local business names. These surgeries include three locations which are wholly referral practices providing first class specialist treatment. We have also launched Pet Medic Recruitment business which recruits locums and permanent staff for both our own and third party practices and a buying group known as Mi Vet Club. During the 2013 we began the development of our own brand, MiPet, products. The first two products, Pro-bind (a gut protective) and Active+ (a joint supplement), were launched in July 2013. The own brand label will protect our market as well as our margins and, whilst the initiative is currently limited in scale, further products will be developed during 2014.

CVS(UK)Limited was established in August 1999 to acquire and operate veterinary practices which were well established within their local communities and had a reputation for high quality service. The Company strategy recognises that the value of veterinary businesses lies in the quality of their staff and the relationship they enjoy with their existing clients.




Professional management expertise and other services are therefore provided centrally to all Group practices, relieving them of their administrative burden and enabling local staff to concentrate on clinical care.

The Directors believe that several factors are currently contributing to a growth in the market for veterinary services in the UK, based on growing and ageing pet populations, advances in veterinary medical science, changes in the demographic profile of the human population and a growth in the pet insurance industry.

Building on these underlying growth prospects, and capitalising on other drivers that are encouraging vets to sell their practices to corporate operators, CVS has expanded by acquisition into the market and established a leading position as a national consolidator and operator of veterinary practices and laboratories.

CVS is incorporated in England and currently operates in England, Wales and Scotland.

aims-best-companies-confirmed

Company of the year

CVS

Vet practices consolidator CVS (CVSG) celebrates its eighth anniversary on AIM by winning the coveted AIM company of the year award. The share price has nearly trebled since CVS joined AIM and it has successfully used its share quotation to help finance a consistent stream of acquisitions of vet practices. The sector is still highly fragmented even though CVS has a strong relative market position. The £7.7 million acquisition of Alnorthumbria Veterinary Practice takes the number of surgeries to 307. The acquisitions, development of online operations and the launch of the Healthy Pet Club, which brings in regular revenue, have helped propel profit higher and Peel Hunt forecasts a 2015-16 profit of £22.7 million, rising to £24.5 million in 2016-17. I thought Clinigen, admittedly the newest AIM company on the shortlist, would win, but its chief executive Peter George won entrepreneur of the year instead (see below).

Acquisition of Highcroft Pet Care
RNS
RNS Number : 3316D
CVS Group plc
26 October 2015

26 October 2015



CVS Group plc

("CVS", the "Company" or the "Group")



Acquisition of Highcroft Pet Care Limited ("Highcroft")



CVS, the UK's leading provider of integrated veterinary services, is pleased to announce that has acquired the entire share capital of Highcroft, a provider of small animal veterinary services in the Bristol area comprising 13 surgeries (the "Acquisition"). Completion took place on 23 October 2015.



Highcroft has operated from its main site in Whitchurch, Bristol since 1982, which the Royal College of Veterinary Surgeons has accredited the highest practice standard, and has developed its other sites gradually since then. Highcroft has some 50 professional vets, including 5 diploma holders, and approximately 220 staff in total.



Highcroft is a rapidly growing and strategically important acquisition for the Group, bringing CVS its first significant presence in the Bristol area, a large market where it currently has few surgeries. Highcroft is an integrated practice, already offering out-of-hours and referrals services to which CVS will direct business from other existing CVS practices in the wider area. Recent growth in Highcroft is being driven by the development of a new referral business, which comprises over 20% of turnover, four sites acquired and fully refurbished in 2014 and the establishment of three small sites in 2014 which will act as feeders for the Group's wider service proposition.



Until recently Highcroft operated as two separate legal entities which were brought together as Highcroft Pet Care Limited in February 2015. Based on unaudited pro forma figures for the combined Highcroft group for the year to 31 January 2015, Highcroft generated turnover of approximately £7.3 million, adjusted earnings before interest, tax, depreciation and amortisation ("EBITDA") of approximately £0.5 million and a reported profit before tax of approximately £0.2 million. As at 31 January 2015, net assets of Highcroft were £0.5 million.



The Directors believe that these unaudited pro forma figures do not fully reflect the current performance of Highcroft, which benefits from a high and growing level of referrals business at higher gross margin than first treatment practice revenue. Unaudited sales for the 8 months to September 2015 grew by over 30% against the comparable period last year. This growth is being driven by the development of the referrals business, the full year impact of the sites that were acquired and refurbished in the previous year and the growth of the more recently established, immature sites. These factors will continue to have an on-going impact on Highcroft, with high growth expected to continue in the near term.



The Group intends to continue to develop the Highcroft business to optimise its potential. As part of CVS, Highcroft is also expected to benefit substantially from better purchasing power as well as overhead synergies. These benefits are conservatively estimated to approach £0.6 million within three years. CVS expects the Acquisition to be mildly accretive in the Group's current financial year, reflecting the initial investment in the business, with phasing of synergy benefits and further growth delivering fuller accretive benefit in the first full year of ownership and beyond.



The initial total consideration payable to the shareholders of Highcroft is £7.4 million including costs. This figure is subject to adjustment based on the working capital and indebtedness of Highcroft as at 23 October 2015. In addition CVS will acquire net debt of approximately £4.1 million with Highcroft. Intangible assets and goodwill of approximately £11.0 million are expected to arise on completion of the Acquisition.



Up to £1.0 million of deferred consideration is payable to the vendors of Highcroft in 2017, subject to sales of at least £10.2m being achieved in the Highcroft business year ending 31 January 2017.



The Directors believe that the Acquisition is a particularly strong fit with the Group's existing operations and a further important step in the Group's strategy of growing integrated operations in practices, out-of-hours and referrals centres. The Acquisition follows the opening of the Group's Lumbry Park referral centre earlier this month and the acquisition of the Dovecote referral centre in July 2015.



Simon Innes, Chief Executive of CVS commented, "CVS looks forward to working with the Highcroft team to continue to deliver high levels of expertise and service as we deliver the next phase of growth together."

Annual general meeting statement

CVS Group PLC (CVSG:LSE) set a new 52-week high during today's trading session when it reached 760.50. Over this period, the share price is up 87.78%.

Acquisitions and New Bank Facilities
RNS
RNS Number : 9627H
CVS Group plc
04 December 2015

4 December 2015



CVS Group plc

("CVS", the "Company" or the "Group")



Acquisition of Albavet Limited ('Albavet'), The Pet Crematorium Limited ('The Pet Crematorium') and New Bank Facilities



Acquisition of Albavet



CVS (AIM: "CVSG"), the UK's leading provider of integrated veterinary services, is pleased to announce that on 3 December 2015 it acquired the entire share capital of Albavet and its wholly owned subsidiary, VETisco Limited (together the "Albavet Group" and the "Acquisition").



The Albavet Group employs some 34 professional vets and over 150 staff in total across three separate businesses: 11 veterinary surgeries; a veterinary buying group, trading under the name of Vetshare; and an instrumentation business trading under the name of VETisco.



The veterinary surgeries are well established businesses and are based in the Fife area (4 sites), Glasgow (1 site), Nottingham (1 site), the Stoke-on-Trent area (4 sites) and Wallington, Surrey (1 site). The surgeries perform small animal work.



The Vetshare buying group currently has over 400 members operating from over 500 surgeries across the UK. Vetshare negotiates supplier rebates on behalf of its members and generates its revenues based on commission on members' purchases from wholesalers. It also sources and negotiates other veterinary services for its members, including crematoria and laboratory work. In September 2014 members of the London Vet Forum buying group transferred to Vetshare, increasing the number of members by over 20%.



The VETisco instrumentation business is a small distribution business having commenced in 2012. It currently makes a small loss.



In the year to 31 October 2014, the last for which published accounts are available, the Albavet Group had turnover of approximately £6.6 million, of which £5.5 million was generated by the surgeries. Earnings before Interest, Tax and Depreciation and Amortisation ("EBITDA") was c. £0.8m million and profit before tax was £0.6 million (both after adjusting for rent that will be payable on properties owned by the Albavet Group pre acquisition but which will be leased post acquisition). As at 31 October 2014 net liabilities excluding goodwill of Albavet were £0.7 million.



The total consideration payable to the shareholders of Albavet is £11.3 million including costs. This figure is subject to adjustment based on the working capital and indebtedness of Albavet at the date of acquisition. In addition CVS will acquire net debt of approximately £0.1 million with Albavet. Intangible assets and goodwill of approximately £11.6 million are expected to arise on completion of the Acquisition.



The consideration for the Acquisition was paid out of the Group's new bank facilities.



Albavet is a strong fit with the Group's existing operations. Its surgeries fit well into the geographical spread of the Group's existing small animal sites. The acquisition of the Vetshare buying group will provide a significant base for further development of CVS's buying group strategy. As part of the CVS Group, Albavet is expected to benefit substantially from better purchasing power. Many of the benefits within the Albavet surgeries are expected to be generated over the first year post acquisition, while benefits in the enlarged buying group are expected to be achieved over the medium term.



Acquisition of The Pet Crematorium

CVS has also acquired the entire share capital of The Pet Crematorium which consists of two crematoria: the first is located at Witton Gilbert, near Durham and the second is at Larkhall, near Hamilton. It employs about 22 staff. The terms of this transaction are below the threshold requiring further disclosure.



This acquisition significantly improves the geographical coverage of CVS's crematoria network. The Scottish and North East England locations complement the existing CVS sites at Rossendale, Runcorn, Exeter and Cobham.



New Bank Facilities



CVS is also pleased to announce that it has entered into a new bank facility agreement which provides the Group with total facilities of £115 million to support the Group's organic and acquisitive growth initiatives over the coming years. These facilities are provided by a syndicate of three banks: RBS, HSBC and AIB. They replace the existing banking arrangements on more favourable terms, including a lower coupon, and comprise the following elements:

· A fixed term loan of £67.5 million, repayable on 23rd November 2021 via a single bullet repayment; and

· A six year Revolving Credit Facility ("RCF") of £47.5 million that runs to 23rd November 2021.



In addition the Group has a £5.0 million overdraft facility renewable annually.



The two main financial covenants associated with these facilities are based on Group Borrowings to EBITDA and Group EBITDA to interest. The Group Borrowings to EBITDA ratio must not exceed 3.5 for the period up to 31st December 2017 from when it must not exceed 3.0. The Group EBITDA to interest ratio must not be less than 4.5. The facilities require cross guarantees from the most significant of the CVS Group's trading subsidiaries but are not secured on the assets of the Group. EBITDA is based on the last 12 months' performance adjusted for the full year impact of acquisitions made during the period.



Commenting on the Acquisitions and on the new facility agreement, Simon Innes, CVS Chief Executive, said:



"The Albavet Group is a well-established, high quality operation. This acquisition significantly develops our surgeries in central Scotland and in the Midlands. The Vetshare buying group provides a major step forward in our strategy of developing a significant buying group which can benefit from the scale and scope of CVS.



The Pet Crematorium is a great addition to our Crematoria Division with the two locations near Hamilton and Durham ideally complementing our existing crematoria network.



We are delighted to welcome the Albavet and The Pet crematorium staff to CVS.



The new borrowing facility provides CVS with ability to finance the acquisition of Albavet and a number of other acquisitions that we expect to take place in the remainder of the financial year. The Group is comfortable with operating at a Group Borrowings to EBITDA ratio in the region of 3.0 for a period of time and the maximum ratio of 3.5 allows us the flexibility to do so. This level of gearing is a temporary measure, to allow us to complete the unusually large number of significant acquisitions that have taken place this year. The reduction of the maximum ratio to 3.0 from 31 December 2017 underlines our intention to reduce gearing gradually following the current period of higher acquisitive growth, and reflects the strong cash generation in the business which also funds the Group's numerous organic growth initiatives."

Broker Forecast - Peel Hunt issues a broker note on CVS Group PLC
BFN
Peel Hunt today reaffirms its buy investment rating on CVS Group PLC (LON:CVSG) and raised its price target to 850p (from 775p).

Story provided by StockMarketWire.com

17 Dec Berenberg 880.00 Buy

CVS Group PLC (CVSG:LSE) set a new 52-week high during today's trading session when it reached 824.00. Over this period, the share price is up 83.11%.

Still 40p short of the broker target. Looks pretty strong going into 2016 as most pet lovers will pay out for vet bills.



CVS Group PLC (CVSG:LSE) set a new 52-week high during today's trading session when it reached 840.00. Over this period, the share price is up 86.67%

Notification of Presentation and Interim Results
RNS
RNS Number : 2395M
CVS Group plc
19 January 2016

19 January 2016





CVS Group plc

("CVS")



Notification of Shareholder Presentation and Interim Results



CVS, the UK's leading provider of integrated veterinary services, is today providing analysts and institutional investors with a tour of its new Lumbry Park Major Multi Disciplinary Referral Centre, together with a briefing focussed on the strategy and operations of the group. No new material information will be provided.



CVS also announces that it will be releasing its Interim Results for the six months ended 31 December 2015 on 21 March 2016.

Interim results

· Sales growth of 23%

· Like-for-like sales increase of 3.0%

· Adjusted EBITDA up at £14.6m (23.7%)

· Adjusted EPS 14.7p (14.0%)

· Net debt £84.8m (June 2015: £46.2m) reflecting a significant acceleration in acquisition activity

· 42 practice surgeries acquired during the period and 8 after the period end

· Significant development of the referrals business with the acquisition of Highcroft Veterinary Referrals, Dovecote Veterinary Hospital and the opening on Lumbry Park Veterinary Specialists

21 Mar Peel Hunt 850.00 Buy

31 Mar Berenberg 880.00 Buy

Sunday Midas tip -CVS Group is the largest veterinary company in the UK, with more than 350 surgeries, five laboratories that carry out diagnostic tests for vets and seven pet crematoria. The company also owns Animed Direct, an online store for medicines, pet food and other must-have pet products.

Midas recommended CVS in June 2009, when the shares were 142p. Today the stock is 748½p, down from 806p before the Brexit vote. At current levels, the shares are a buy.

CVS has expanded substantially over the past seven years, both organically and through acquisition, and profits have quadrupled. Brokers expect profits up 25 per cent to £24.4 million for the year to June 30. Further strong growth is pencilled in for the next two years.

Research shows that pets are increasingly regarded as members of the family, so owners spend more on their food, health and wellbeing. This should play to CVS Group’s strengths, whatever the economic outlook.

Midas verdict: CVS shares have been knocked back along with many other consumer-related stocks, but the reaction is overdone. Investors who bought back in 2009 should retain their shares. New investors may also find value at today’s price.

Director Deals - CVS Group PLC (CVSG)

Nick Perrin, Financial Director, bought 2,000 shares in the company on the 7th July 2016 at a price of 688.63p. The Director now holds 12,000 shares. NOTE: Average price Story provided by StockMarketWire.com Director deals data provided by www.directorsholdings.com

16:05 07/07/2016
Director Deals - CVS Group PLC (CVSG)

Richard Connell, Chairman, bought 5,000 shares in the company on the 7th July 2016 at a price of 688.63p. The Director now holds 97,891 shares. NOTE: Average price Story provided by StockMarketWire.com Director deals data provided by www.directorsholdings.com

Trading update

25 Jul Peel Hunt 950.00 Buy

29 Jul Berenberg 910.00 Buy

2 Aug Investec 880.00 Buy

Proactive investor -Profits set to fluff up at CVS Group plc
Share
15:44 22 Sep 2016
Veterinary group is expected to report full-year profits modestly ahead of expectations

CVS treats domestic pets as well as horses and larger animals
Veterinary services provider CVS Group plc (LON:CVSG) will aim to appeal to the City’s animal instincts on Friday.
CVS, which is unveiling full-year results, said in a pre-close update in July that it expected adjusted pre-tax earnings for the year to the end of June to be modestly ahead of market expectations.
The company, which runs a range of veterinary practices and hospitals mainly in southern England, said at the time that annual revenue had risen 4.8% against the first half’s 3%.
Investors are likely to look out for any deal news after a record year in terms of the number of acquisitions.
It acquired 67 surgeries as well as three crematoria, the Vetshare buying group and the VETisco instrumentation business.
“We continue to see a significant number of acquisition opportunities and are able to focus on those that offer the best potential for the group,” it said.
The City is also likely to look for any changes to guidance after the group’s July forecast of further like-for-like growth, albeit more moderate following a strong performance in the previous six months