Why this small cap ASX share zoomed 7% higher today

The Probiotec Limited (ASX:PBP) share price was on form on Wednesday and zoomed notably higher. Here's why…

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The Probiotec Limited (ASX: PBP) share price continued its impressive run on Wednesday.

It shares finished the day almost 7% higher at $2.37. This latest gain means the Probiotec share price is now up a sizeable 55% over the last 12 months.

a woman

What is Probiotec?

Probiotec is a manufacturer, packer and distributor of a range of prescription and over-the-counter (OTC) pharmaceuticals, complementary medicines and consumer health products.

It owns three manufacturing facilities in Australia and counts a number of major international pharmaceutical companies as customers.

Why did the Probiotec share price surge higher today?

Investors were fighting to get hold of the company's shares following the release of an update on its expectations for the first half of FY 2020.

According to the release, the company expects to report first half revenue from continuing operations of $44.1 million. This will be a 34% increase on the same period last year.

Growing at an even stronger rate will be the company's EBITDA from continuing operations. For the six months ended December 31, management expects EBITDA from continuing operations of approximately $6.2 million. This represents an increase of 68% on the prior corresponding period.

In the absence of any unforeseen events and subject to normal trading conditions, management expects an equally strong full year result.

It has reaffirmed its guidance for full year revenue of greater than $100 million and EBITDA in the range of $16 to $17 million for FY 2020.

Though, there appears to be scope for the company to outperform this guidance. Management advised that Probiotec continues to receive solid levels of enquiries and sales leads.

Furthermore, it notes that it is well positioned to capitalise on these opportunities with significant capacity available as a result of recent investments.

The company's CEO, Wes Stringer, said: "We are pleased that we have continued to execute with respect to the delivery on the existing portfolio of the business as well as the ongoing integration of our recent acquisitions."

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Probiotec Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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