Premier Veterinary Group PLC Trading Statement (2805M)

TIDMPVG

RNS Number : 2805M

Premier Veterinary Group PLC

12 October 2016

PREMIER VETERINARY GROUP plc

("PVG" or "the Group")

Trading update for the year to 30 September 2016

"Number of pets on Premier Pet Care Plan up 70% in the last 12 months"

London, UK, 12 October 2016 - Premier Veterinary Group plc (LSE: PVG) provides the following update on trading in advance of the preliminary announcement of its results for the year ended 30 September 2016.

Premier Pet Care Plan Customer Growth

The Group's recurring revenue streams are driven by the number of pets that are signed up to Premier Pet Care Plan ("PPCP"), a preventative healthcare program for pets. The number of pets on active plans at the end of the fourth quarter of 2016, and in the preceding four quarters, are as follows:

 
                      As at      As at      As at      As at      As at 
                    Sept-15     Dec-15     Mar-16     Jun-16    Sept-16 
United Kingdom       79,000     99,000    107,000    115,000    121,000 
Europe                3,000      5,000     10,000     14,000     18,000 
 
  Total no of 
  fee generating 
  pets on plan       82,000    104,000    117,000    129,000    139,000 
 

Overall, the number of pets on plan has increased by 70% in the last 12 months.

Overview of PPCP developments in each region

United Kingdom

In the United Kingdom, the number of pets on PPCP has grown by 5% in the last quarter, despite losing approximately 5,500 pets on plan in the same period as a consequence of the sale of the Group's veterinary practices. As part of its own integration activities, the party that acquired the Group's veterinary practices moved these pets to their existing wellness plan. When adjusted to reflect only the practices that were not part of the sale, the net increase in pets on plan in the last quarter on a like for like basis is 11%.

In the 12 months to September 2016, the number of pets on PPCP has grown by 53%.

As previously announced, the Group has signed a three-year contract extension to provide PPCP to all Medivet Group Limited's ("Medivet") new and existing practices in the UK. Medivet currently operates 143 practices across all areas of the UK and plans to expand further.

Europe

The number of pets on PPCP has grown by 29% in the last quarter. The Group is now operating in 5 countries in Europe, namely the Republic of Ireland, Denmark, the Netherlands, France and Germany.

The majority of business in Europe is currently in the Netherlands with approximately 15,000 pets on plan in that country. PPCP is branded as "Huisdieren Zorg Plan" ("HZP") in the Netherlands and, since its introduction to the Dutch companion animal market in March 2015, the Group, through its subsidiary Premier Vet Alliance Limited, has entered into contracts with over 10% of the available clinic market.

Furthermore, the Group has signed a cooperation agreement for PPCP with Zoetis, one of the world's largest animal healthcare companies.

The cooperation agreements signed with this influential global manufacturer serving this market will result in their representatives identifying and supporting practices which are interested in launching HZP in the Netherlands. Working in close collaboration with Zoetis is expected to accelerate the penetration of HZP into the wider Dutch market.

In the last quarter, sales teams have been recruited in France and Germany and 12 clinics have signed agreements with the Group in these territories. These clinics are scheduled to launch and start offering PPCP in the first quarter.

United States

As previously announced, the Group has signed agreements with Veterinary Practices Inc, ("VPI") and Merritt Veterinary Supplies Inc ("MVS"). Both of these agreements promote the roll out of PPCP to their respective member hospitals.

As at 30 September 2016, 39 clinics have contracted with the Group's wholly-owned subsidiary, Premier Vet Alliance (US) Limited ("PVA"). The first 10 clinics have now launched and over 200 pets are already signed up to PPCP.

The initial volume of clinics signing up to PPCP has exceeded internal expectations. A team of 8 sales and training staff has been recruited and the Group is operating in 7 states, all in the South East of the United States.

Buying Group

Members of the buying group operated by the Group's subsidiary, Premier Vet Alliance Limited (the "PVA Buying Group") enjoy access to a range of services designed to encourage clinical compliance, the highest standards of pet care and business growth. The PVA Buying Group is primarily designed to provide more autonomy, flexibility and deliver greater savings. The specially negotiated discounts on both small and large animal products enable independent practices to compete with larger groups.

Currently over 500 clinics throughout UK, Northern Ireland and the Republic of Ireland are members of the PVA Buying Group

Loan Note issue

As previously announced, the Group has recently raised GBP900,000 through the first tranche of loan notes, with a further GBP350,000 committed for drawdown by the end of the year. These funds were raised to support the investment in business development resources in the US and Europe to fuel expansion in these areas.

Outlook

Early indications in the new geographic markets are positive as the number of clinics signing up to PPCP is exceeding initial expectations. The Group will continue to make significant investment in technology and business development resource to maximize opportunities in both the UK and these new territories.

Dominic Tonner, Chief Executive Officer of PVG, added:

"We continue to see significant growth in our established market for preventative healthcare programs in the UK. The board is delighted with the initial progress the Group has made in the US and our progress in Europe continues to gather momentum from our success in the Netherlands. The investment we have made in our global transaction IT platform and our business development resources leave us well positioned to grow rapidly in the year ahead."

For further information, please contact:

Premier Veterinary Group plc Tel: [phone]

Dominic Tonner, Chief Executive Officer

Will Evans, Chief Financial Officer

   Square1 Consulting                                                        Tel: [phone] 

David Bick/Brian Alexander

Note to Editors:

PVG's services to third party veterinary practices, through its wholly-owned subsidiary, Premier Vet Alliance Limited ("PVA"), include the administration and support of a preventative healthcare program for pets branded "Premier Pet Care Plan" ("PPCP"); and the operation of a buying group (the "PVA Buying Group") which offers enhanced discounts to member practices on pharmaceutical and consumable spending. In the US, Premier Pet Care Plan is marketed through the Company's wholly-owned subsidiary, Premier Vet Alliance (US) Limited.

PPCP is a structured, preventative healthcare program for cats, dogs and rabbits and is available only through veterinary practices. The program is seen as a way of providing gold standard care for pets at an affordable price for the client, by way of fixed monthly payments.

PPCP uses a clinical approach to prevention, as this is the most effective method of ensuring illnesses are diagnosed more quickly and not given a chance to advance. What truly sets PPCP apart is its unique approach of offering an end-to-end solution and support to the practice, which has been proven to work extremely well. PVA works alongside practices to create a tailor-made, cost-effective service for clients, one that delivers excellent care to their patients and significantly improves practice performance.

The PVA Buying Group, is now the UK's largest veterinary buying group without group interests in veterinary practices or veterinary wholesalers offering its members the best discounts across the industry on pharmaceutical and consumable spend.

For further details: http://www.premiervetalliance.co.uk/:

This announcement includes "forward-looking statements" which include all statements other than statements of historical facts, including, without limitation, those regarding the Company's financial position, business strategy, plans and objectives of management for future operations, and any statements preceded by, followed by or that include forward-looking terminology such as the words "targets", "believes", "estimates", "expects", "aims", "intends", "will", "can", "may", "anticipates", "would", "should", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. These forward-looking statements speak only as at the date of this announcement. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward- looking statements contained in this announcement to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. As a result of these factors readers are cautioned not to rely on any forward-looking statement.

This information is provided by RNS

The company news service from the London Stock Exchange

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October 12, 2016 02:00 ET (06:00 GMT)