LONDON (ShareCast) - (Sharecast News) - Veterinary service provider CVS Group reported "strong" first half financial performance on Friday, with total sales growing by 9.4% to £245.6m.

The AIM-traded firm said like-for-like sales increased 7.8% for the six months ended 31 December, down from 8.4% in the prior year, which it said reflected continued momentum across all divisions and the recognition of HPC revenue.

Its adjusted EBITDA margin improved from 16.9% in the first half of the 2020 financial year, to 18.4% in the first half of 2021, with vet vacancy rates remaining "stable" at 7.4%, compared to 7.8% a year earlier.

CVS said its positive trading performance, coupled with continued strong cash generation, led to a reduction in net bank borrowings to £44.4m from £63.5m at the start of the period, with leverage at 0.72x as at 31 December, down from 1.14x respectively.

Four small animal practice acquisitions were completed in the first half, up from the three acquisitions it made in the first half of 2020.

All CVS practices remained open in the current lockdown, the board said, offering essential services to clients in accordance with Royal College of Veterinary Surgeons guidance, but with a closed-door policy to clients in the interest of public health.

"The veterinary market continues to benefit from favourable consumer trends, with increasing pet ownership and the humanisation of pets driving wider appreciation of animal care," the CVS board said in its statement.

"These trends, coupled with advances in clinical care increases the range of services we can offer.

"Alongside our excellent clinical standards and preventative care offerings, and the breadth of our integrated model, this is providing additional resilience to a number of our revenue streams."

The board said it was "pleased" with the group's resilience, as shown through the positive performance of the business, despite the challenges experienced from the second half of the prior financial year.

"Although the board remains cautious given the current level of macro uncertainty, particularly in light of the recent UK lockdown restrictions, the improved performance has been maintained across all operations during the first half.

"The board therefore remains confident in the Group's ability to maintain clinical excellence and in the adaptability of its people and processes, which together support the group's continuing momentum and its strong longer-term prospects."

CVS said it would announce its interim results for the six months ended 31 December on 25 March.

At 0949 GMT, shares in CVS Group were up 2.75% at 1,538.1p.

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