What: The past year has provided completely divergent performances for investors in the listed health products space.
While market leader Blackmores Limited (ASX: BKL) – which now boasts a market capitalisation of $1.5 billion – has astounded many investors with its share price surging a massive 220% in the past 12 months; the share performance of $45 million minnow Vita Life Sciences Limited (ASX: VSC) has gone in the opposite direction, sinking around 50%.
So What: The share price performance of Vita Life Sciences in the past year is understandable when one reviews the just released half-year results. Here are the key points:
- Sales revenue up 3% to $18.2 million
- Earnings before interest and tax (EBIT) down 28% to $2.37 million
- Net profit after tax down 67% to $1.56 million
- Diluted earnings per share down 66% to 2.79 cents
- Dividends per share up half a cent at 1.5 cents
Now What: Vita Life Sciences is an over-the-counter pharmaceutical and healthcare business involved in the formulating, packaging, sales and distribution of vitamins and supplements. Its product range is sold across eight countries including Australia and Singapore where the company is experiencing continued growth. Meanwhile, its sales into Malaysia, China and Thailand have been affected by country specific issues.
According to a consensus forecast provided by Morningstar, analysts are expecting Blackmores to grow its earnings per share from 149.2 cents per share (cps) in financial year (FY) 2014 to 246.2 cps in FY 2015, and to 293 cps in FY 2016. Much of this growth is thanks to a well-executed expansion into Asia where the group is enjoying strong growth rates.
Whether Vita Life Sciences can successfully follow in Blackmores' footsteps remains to be seen…
