Chairman's Letter

Photograph inset:
Dr. Peter Fellner

Consort Medical has delivered a year of solid trading performance in its core business, and has further expanded its future growth opportunities from both its development portfolio and its innovation pipeline.

The Group has demonstrated successful execution of its long-term organic growth strategy in a number of important areas during the year.


Following 5.2% growth, Bespak surpassed £100m in revenues (FY2013: £95.0m) for the first time. This growth of our core revenues translated strongly into earnings growth, with adjusted EPS growing by 8.5% to 48.3p per share (FY2013: 44.5p).

EBITDA before special items increased by £0.4m (2.0%) to £24.4m (FY2013: £24.0m). With ongoing major investment programmes to support our organic growth, working capital increased by £4.0m to £24.1m (FY2013: £20.1m), and capital expenditure increased to £16.3m (FY2013: £6.9m).

The Group balance sheet closed with a net cash position of £25.8m (FY2013: net cash £37.0m). With headroom of £73.3m under its undrawn banking facility, and a further £25.0m available under an accordion facility, the Group has significant cash resources available to comfortably satisfy its future growth and capital commitments.

Development and Innovation

Our development pipeline saw good progress in the year. A major highlight was the regulatory approval and launch of our first auto-injector, for Dr. Reddy's sumatriptan, confirming Bespak's expertise in the injectables market.

We were awarded a new programme during the year for a nasal drug application (NAS030); and an exclusive multi-year commercial supply contract for our dry powder inhaler programme DEV610 also adds further scale to our growth potential.

Bespak's regulatory competence and reputation was further endorsed by the UK MHRA awarding us a first licence for commercial drug handling. This significant achievement is an important milestone in the Nicoventures programme, and paves the way for similar future commercial opportunities.

Our Innovation team achieved the commercial unveiling of the Syrina®, Vapoursoft® and Lila® technologies at the Parental Drug Association exhibition in Basel in November 2013. We look forward to their translation into customer-partnered development programmes in the future.

Board Changes

Ian Nicholson brings to Consort Medical extensive expertise and Life Sciences industry experience, and during the year the executive team, supported by the Board, took the decision to engage Ian's services in support of a number of business development opportunities. Cognisant of the UK Corporate Governance Code (2012), Ian has accordingly relinquished his membership of the Audit and Remuneration Committees, as he is no longer classed as an independent non-executive director.

Following her appointment as Chairman of Venture Life Group plc, Dr. Lynn Drummond has indicated her intention not to stand for re-election at the forthcoming Annual General Meeting. On behalf of the Board and the Company, I would like to thank Lynn for her considerable contribution to the Group over the past three years.

Following Lynn's decision to stand down, the Company is working with advisers to appoint a further independent non-executive director to the Board.

After more than four years' service at Consort Medical, John Slater, our Legal Counsel and Group Company Secretary, retired on 30 April 2014. On behalf of the Board and the Company I would like to thank John for his sterling service, and to wish him a very happy retirement. The Board is pleased to announce the appointment of his successor, Iain Ward, as Group Legal Counsel and Company Secretary. Iain will be joining the Group on 14 July 2014 from Shire plc.


I wish to thank our employees for their excellent contributions over the past year, which have been crucial in strengthening the Company's position. I also thank our shareholders for their continued support for the Company.


The Board has reviewed the final dividend, and I am pleased to recommend that it will be increased to 13.35p per share. The dividend will be paid on 24 October 2014 to shareholders on the register at 19 September 2014, following our Annual General Meeting on 4 September 2014.

Dr. Peter Fellner

1 Financial performance metrics relate to continuing operations unless stated otherwise.