Apiam: Apiam Animal Health Ltd (ASX:AHX) (H1 2025) Earnings Call Highlights: Resilient Revenue Growth ...

In This Article: Release Date: February 25, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Negative Points Q & A Highlights Q : Do you have any insights into the broader vet clinic spend across the companion and pet animal markets, and what sort of underlying industry growth rates are you seeing in the current economy? A : Christopher Richards, Managing Director, noted that the companion animal veterinary services are facing challenges due to cost-of-living issues and a low point in the life cycle of pets. The industry is seeing a 7% revenue decline, but Apiam's investments in people and standards of care are helping to outperform the industry. Q : Could you please quantify the cost savings you estimate flowing into the second half from some of the efficiency measures you've outlined? A : Matthew White, CFO, stated that they expect similar cost savings in the second half as seen in the first half, with a 3% reduction on a like-for-like basis in clinical vet services, which is the best opportunity for efficiency. Q : Given APM's mixed history with acquisitions, what criteria and hurdle rates do the board use when considering acquisitions? A : Christopher Richards explained that acquisitions must be compelling and add value, with growth opportunities and good succession plans. They also consider the additional costs when private businesses join Apiam, ensuring a compelling growth story and regional synergies. Q : Are there now all profitable clinics that are left, or are still some losing money? A : Christopher Richards mentioned that there are still four Greenfield clinics that are losing money, impacting about a million dollars a year. The focus is on improving EBITDA margins across clinics, with opportunities to enhance earnings. Q : How do you see the impact of softer equine markets flowing through into the second half? A : Christopher Richards noted that the majority of equine revenue comes from the breeding season, which occurs in the first half of the year. Therefore, the softer equine markets will not significantly impact the second half. Q : Has APM's new director, Bruce Dixon, expressed his views on why he's invested in APM and what input suggestions has he made to date? A : Christopher Richards stated that Bruce Dixon invested because he sees significant growth opportunities in the business. Dixon has contributed valuable insights on business operations. Q : Are you looking to expand pathogen detection services using emerging technologies as part of growth and utilization of resources at ACE Laboratories? A : Christopher Richards confirmed that they are expanding pathogen detection services, developing new diagnostic kits, and investing in next-generation sequencing to enhance pathogen diagnostics and antimicrobial usage monitoring. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus .