Animalcare has delivered a strong set of FY25 numbers, but there are really two stories in this RNS. First, the underlying business had a very good year, helped massively by the Randlab acquisition and continued growth from key brands. Second, the market now has to judge those results through the lens of the recommended cash takeover from Charterhouse.
For retail investors, that means one simple question: is this a business improving fast enough to justify why a buyer wants it? On the evidence here, the answer looks like yes.
Animalcare FY25 results: the key numbers investors need to know
| Metric | FY25 | FY24 | Change |
|---|---|---|---|
| Revenue | £89.1 million | £74.2 million | +20.0% |
| Underlying EBITDA | £17.7 million | £11.6 million | +52.6% |
| Underlying profit after tax | £10.9 million | £6.7 million | +62.7% |
| Reported profit after tax | £5.1 million | £18.5 million | Down |
| Underlying continuing basic EPS | 15.7 pence | 10.9 pence | +44.0% |
| Reported basic EPS | 7.3 pence | 30.3 pence | Down |
| Net debt excluding lease liabilities | £9.1 million | £9.0 million | Broadly flat |
| Leverage | 0.7 times underlying EBITDA | Not disclosed in same format | – |
| Cash conversion | 79.7% | 103.1% | Lower |
| Recommended offer price | 336 pence per share | Not applicable | – |
A quick bit of jargon. Underlying figures strip out one-off or non-core items such as acquisition, restructuring and amortisation charges. Reported figures are the full statutory numbers.
Why Animalcare’s profit quality looks better than the headline drop suggests
The first thing that could confuse investors is the big fall in reported profit after tax to £5.1 million from £18.5 million. On the face of it, that looks ugly. In reality, last year’s reported number was flattered by disposal gains from Identicare and STEM, so this is not a like-for-like deterioration in trading.
The cleaner read is the underlying performance, and that was strong. Underlying EBITDA rose 52.6% to £17.7 million, while underlying continuing basic EPS climbed 44.0% to 15.7 pence.
That tells you the core business got better, even if the statutory comparison looks messy. I’d call that a positive, and an important one.
Randlab acquisition transforms Animalcare’s Equine growth and margins
The engine room of this update is Randlab. Animalcare completed that acquisition on 3 January 2025, and it has made an immediate difference to both scale and profitability.
Equine revenue jumped 185.1% to £21.1 million. Of that, £13.6 million came from Randlab, while the existing Equine portfolio contributed £7.5 million.
More importantly, Randlab looks high quality. The acquired business delivered like-for-like organic growth of about 12.0% at constant exchange rates, ahead of management expectations, and generated gross margins of 72.9% before the inventory fair value adjustment. That is the kind of margin profile that can really lift a group.
You can see that in the consolidated numbers. Group gross margin improved by 320 basis points to 58.8%, and underlying EBITDA margin before R&D expenditure improved by 500 basis points to 20.6%.
My view: this acquisition has not just added revenue, it has upgraded the business mix. That matters more than simple top-line growth.
Organic growth was modest, so Animalcare still needs its flagship brands to fire
There is one note of caution. Group like-for-like organic growth was only 1.7% at actual exchange rates, or 0.7% at constant exchange rates. So while total revenue growth was impressive, most of it came from acquisitions rather than the legacy business.
That said, the better parts of the portfolio are still performing well. Daxocox grew 23%, Plaqtiv+ grew 42%, and Orozyme grew 30%.
Companion Animals revenue overall rose just 1.0% to £50.3 million, partly held back by reduced Conofite sales in Spain and the end of distribution deals on older, lower-margin brands. Management says those issues had a combined sales impact of around 8-9%.
So the picture here is mixed rather than perfect. The flagship brands are doing well, but the broader organic growth number says Animalcare still has work to do to turn portfolio quality into faster group-wide momentum.
R&D investment rises as Animalcare builds a bigger animal health pipeline
This is another encouraging part of the update. R&D investment rose to 4.5% of revenue from 2.8% last year, with total investment of £4.0 million across five key projects.
The company spent £1.9 million on the VHH NGF antibody programme, including the acquisition of the related assets for a net cash consideration of €0.7 million. It also committed about £2.0 million to preclinical work on Sweet Itch, an equine skin condition affecting an estimated 8% of horses globally.
Animalcare now says it has six major pipeline projects. That matters because animal health companies with differentiated products tend to earn better margins and stronger long-term growth.
The obvious flip side is that R&D spending dents near-term profits and carries development risk. Still, for me, this is the right sort of spending. It looks disciplined and targeted rather than reckless.
Cash flow, debt and the missing final dividend
Cash generation remained solid. Underlying cash conversion was 79.7%, which was lower than last year’s 103.1% but in line with company guidance of about 80.0%.
Net debt excluding lease liabilities was £9.1 million, almost unchanged from £9.0 million a year earlier, despite the group investing in acquisitions, R&D and equity stakes. Leverage at 0.7 times underlying EBITDA is low, and the company had £36.1 million of headroom on its revolving credit facility at year end.
That is a healthy balance sheet. It gave Animalcare room to invest, and it helps explain why a private equity buyer would find the business attractive.
The bad news for income investors is the dividend. Following the recommended acquisition announcement on 16 April 2026, the board is proposing no final dividend for FY25.
That is disappointing in isolation, but also fairly normal in takeover situations. Once a cash offer is on the table, boards tend to avoid anything that complicates the deal.
Charterhouse bid at 336 pence: what the Animalcare takeover means now
The recommended offer from Charterhouse, via CCP Paw 2 Limited, hangs over everything here. The board says the 336 pence per share cash offer provides a premium to recent trading and represents a better outcome than remaining an independent AIM-listed company.
That is quite telling. The board says it remains confident in Animalcare’s standalone prospects, but also admits those ambitions would require years of investment and execution in a tougher macroeconomic backdrop.
Translated into plain English: the company thinks it can grow further, but shareholders are being offered cash today rather than waiting around for the full plan to play out.
Since the period end, trading has continued in line with management expectations. So there is no sign here of a wobble in the underlying business before the takeover process completes.
Animalcare FY25 verdict: strong execution, better business mix, but the takeover is now the main event
This was a good set of results. Revenue rose strongly, margins improved sharply, the balance sheet stayed sensible, and Randlab looks like a smart acquisition that has strengthened Animalcare’s position in Equine.
The main negative is that underlying organic growth was modest, so investors should not kid themselves that everything is flying without acquisition help. Reported profit also looks weaker, though that is mostly an accounting and comparison issue rather than a trading collapse.
Overall, I think this RNS reinforces why Charterhouse wants the business. Animalcare looks more scalable, more international and more focused on higher-quality products than it did a few years ago. For existing shareholders, though, this is no longer just about whether FY25 was good. It is about whether 336 pence per share is a fair price for what Animalcare could become next.
