Stroking an animal slows down the heartbeat, lowers blood pressure and generally makes people feel more relaxed. So it is hardly surprising that over the past year millions of households around the world have become pet owners for the first time or added another furry friend to their homes.
In America, almost 90 million families now own a pet, while Europe boasts more than 140 million cats and dogs.
On the rise: In America, almost 90 million families now own a pet, while Europe boasts more than 140 million cats and dogs
The trend bodes well for animal drugs group Dechra Pharmaceuticals, whose products range from thyroid pills for cats and dogs, to painkillers for horses to flea bite treatment for rabbits.
The group also produces premium pet food, Specific, with varieties for chubby cats and diabetic dogs. Based in Northwich, Cheshire, Dechra’s products are available in more than 70 countries and last week, longstanding chief executive Ian Page posted upbeat half-year results to December 31, including an 8 per cent increase in the dividend to 11.11p.
For the full year, brokers forecast a 12 per cent increase in sales to £576 million, with profits up 18 per cent to £137 million and a dividend of 37.7p, compared with 34.3p last year.
MIDAS VERDICT: Midas first recommended Dechra in 2008, when the shares were £3.97. Today, they are £34.30, so they have risen more than eightfold in the past 13 years and dividends have risen every year too. Longstanding shareholders may feel the time is right to sell a chunk of stock and bank profits but they should retain at least a quarter of their shares. The pet market is booming. Dechra is a well-run business and prospects are sound.
Traded on: Main market Ticker: DPH Contact: dechra.com or 01606 814730
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