South African stock alert


Morning Alert: Adcock Ingram inches higher, resistance at 12-day EMA 18 October 2017 10:50 SAST


Adcock Ingram Holdings Ltd. (J:AIP) has increased 1.4% but fell short of the 12-day Exponential Moving Average [EMA] of ZAR59.37.

Fundamental measures by comparison with the sector average [in brackets] indicate:


Price/Sales of 1.9 [1.9]

Price to Book of 3.6 [3.6]

Dividend yield of 2.2% [2.1%]

Return on Capital Employed 16.3% [15.7%]


Return on Equity 11.7% [4.9%]

Return on Assets 6.8% [2.9%]

Total Liabilities/EBITDA of 3.7 is comfortably below the Joseph Piotroski benchmark of <5.

SECTION 1: Ranking

DescriptionValueRank In Market
MCap $US million795.4In 2nd Quartile
52-week Range (in ZAR)42.5-67.1
1-month Range (in ZAR)57.0-62.2
Today's Volatility %5.9In Bottom Quartile

SECTION 2: Earnings

FY2016 Annual Report: Adcock Ingram Net Profit down 9.9%

Adcock Ingram (J:AIP) reported net profit for the year-ended 31 December 2016 of ZAR179m ($US13.0m), down 9.9% from ZAR199m ($US12.8m) in the previous year.

Major changes compared with previous year:

Favourable Changes:

- Total revenue up 7.3% from ZAR5.2b ($US333.8m) to ZAR5.6b ($US402.0m)

- Interest cover up 33.8% from 6.1 to 8.2

- EBIT to total assets up from 10.8% to 11.2%

- Total revenue to total assets up from 0.9 to 1.0

- Profit before tax to Sales up from 9.5% to 9.9%

- Administration expenses to Sales down from 7.9% to 7.6%

- Interest expenses to Sales down from 1.9% to 1.4%

- Debt to Equity down 38.5% from 0.3 to 0.2

- Current ratio up 20% from 1.6 to 2.0

- Working capital to total assets up from 20.5% to 30.6%

- Total current assets to Total Assets up from 52.1% to 61.8%

- Long-term investments to Total Assets up from 5.1% to 6.3%

- Total Liabilities to EBITDA of 3.7 compares favourably with the Joseph Piotroski benchmark of less than 5. This ratio has improved by 6% from the previous year's ratio of 4.0.

- Total Liabilities to Operating Cash Flow of 4.5 compares favourably with the Joseph Piotroski benchmark of less than 4. This ratio has improved by 18.1% from the previous year's ratio of 5.5.

- Net tangible assets per share up 27.2% from ZAR14.06 (US90.5c) to ZAR17.89 ($US1.3)

Unfavourable Changes:

- Net profit down 9.9% from ZAR198.8m ($US12.8m) to ZAR179.1m ($US13.0m)

- EPS down 13.7% from ZAR1.17 (US7.55c) to ZAR1.01 (US7.33c)

- Retained earnings to total assets down from 36.3% to 34.2%

- Total non-current assets to Total Assets down from 47.9% to 38.2%

- Fixed Assets to Total Assets down from 27.3% to 25.4%


- EBIT Margin steady at 11.3%

- Sales and marketing expenses to Sales down from 18.4% to 18.1%

- Tax expenses to Sales up from 2.8% to 3.1%

- Total liabilities to Total assets steady at 0.4

- Current Inventory to Total Assets down from 22.1% to 20.9%

SECTION 3: Recent News of Adcock Ingram

September 22: Adcock Ingram Holdings Limited - Dealings In Securities By Executive Directors And Company Secretary


In accordance with the JSE Limited Listings Requirements ("Listings Requirements"), shareholders are advised that executive directors and the company secretary have been awarded Share Options in terms of the Adcock Ingram Employees Share Scheme ("scheme") which was approved by shareholders in 2008.

September 12: Adcock Ingram Holdings Limited - Voluntary Announcement - Acquisition Of Genop Holdings Proprietary Limited

Adcock Ingram is pleased to announce that it has concluded a Share Purchase Agreement to acquire 100% of the shares of Genop Holdings Proprietary Limited and its subsidiaries ('Genop' or the 'Business') for a confidential purchase price, payable in cash, (the 'Genop Acquisition').

Genop is a highly specialised instrument, surgical and pharmaceutical products company focussed on the ophthalmic, optometry, skincare, aesthetic and plastic surgery segments in Southern Africa, with historic revenue of approximately R400 million per annum.

August 25: Adcock Ingram Holdings Limited - Group Annual Results For The Year Ended 30 June 2017 And Cash Dividend Declaration

Salient features

Continuing Operations

Increase of 7% in Turnover to R5,936 million

Increase of 10% in Gross Profit to R2,242 million

Increase of 20% in Trading Profit to R724 million

Increase of 37% in HEPS from continuing operations

Increase of 34% in total dividends declared to 139 cents per share

August 25: Adcock Ingram announces dividend

Adcock Ingram today announced a final dividend of 76.0c per share. The ex dividend date is Wednesday, September 13, 2017 and the record date is Friday, September 15, 2017 and it is payable on Monday, September 18.

August 22: Events Calendar: Adcock Ingram Holdings Limited - Post Group Financial Results Announcement Conference Call For Stakeholders To Be Held On Friday 25 Aug 2017 At 11: 00

Adcock Ingram will publish on SENS on Friday 25 August 2017 the Group Financial Results for the year ended 30 June 2017. Shareholders are advised that following the publication of the results announcement, a conference call will be hosted by Mr. Andy Hall, Chief Executive Officer and Ms. Dorette Neethling, Chief Financial Officer.

Adcock Ingram Holdings Ltd. (J:AIP; JNB:AIP; SJ:AIP)

ISIN: ZAE000123436

PermID: 4298082482