Blackmores (BKL) is Australia’s leading natural health brand, providing natural health products such as men’s and women’s multivitamins.

BKL boasts the number one brand in Australia and Thailand, outperforming the market in all of its major territories. BKL’s products span Australia, Malaysia, Thailand, Singapore and Hong Kong.

BKL’s products are supported by the backing of healthcare professionals and key opinion leaders – making BKL the top brand used by GPs in Australia.

A strong year

For FY10, BKL delivered impressive results. Revenue increased 7% on the prior year to $215 million, whilst underlying earnings grew by 25%.

Net profit after tax (NPAT) of $24 million represented a 17% on-year increase, whilst EPS was up 15% on FY09.

BKL declared a final dividend of 70 cents, up 23% on FY09.

BKL noted that its underlying earnings increased significantly in a “year of investment”. The results were supported by the group growing its Asian business, leveraging operational efficiencies from a new facility, and driving innovation.

New products, higher profits

BKL excels in bringing new natural health products to the market that find immediate success amongst consumers and support amongst healthcare professionals, including GPs.

New products such as Everyday Stress Formula and Odourless Fish Oil + Vitamin D3 have proven popular in Australia over FY10 and coming into the new FY.

In Asia, the Omega range of concentrated fish oils in Hong Kong have become a success, as has Joint Formula in Singapore.

BKL released more than 80 new products in FY10, including a range of heart health products, Blackmores Sleep Sound, and Cold & Flu Day/Night.

BKL will be one of the stocks to watch in FY11, with its healthy pipeline including Everyday Stress in 1Q11 and two innovative probiotic products in 2Q11.

Earlier this month, BKL confirmed it was expanding its international presence further via a partnership with CJO Shopping, a major Korean home shopping network, incorporating TV, online and catalogue sales direct to consumers.

Continued strength

BKL’s most recent results – for 1Q11 – indicate the group’s ability to continue to grow revenue and profit, as well as capitalise on the company’s leading brand name.

Total sales for the quarter were $60.6 million, up 11% from the prior year’s first quarter.

Net profit after tax was $7.8 million, a 13% increase on 1Q10.

Conclusion

BKL is a unique healthcare sector player which offers natural alternatives to traditional medicine, capitalising on society’s trend towards more ‘natural’ health treatments.

The group anticipates modest profit growth in FY11, which should be easy to achieve given BKL’s expanded product range and growing footprint in Asia.

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Biota (BTA) is an Australian based, anti-infective drug development company.

The group specialises in the discovery and development of pharmaceuticals, focusing on research for the treatment of viral respiratory diseases, particularly influenza (flu).

Recently, BTA announced that Japan-based Daiichi Sankyo has received approval to manufacture and market its product, Inavir.

Inavir is an anti-viral drugs designed to treat or prevent influenza infections.

Under the agreement, BTA will receive a royalty on all sales in Japan, and both companies are now in talks to market Inavir to the rest of the world.

BTA will be one of the top shares to watch in coming months, as the market waits to see whether the group can successfully launch Inavir on a global scale.

BTA shares rocketed 17% on day of the announcement, making it one of the best performers on the Australian share market.

ASX stock Sonic Healthcare (SHL) is an international medical diagnostics company, providing laboratory, medicine/pathology and radiology services.

Sonic Healthcare (SHL) today reported its FY10 results, keeping the market happy.

SHL recorded a 71% rise in net profit on the prior year to $293.2 million. The prior-year net profit result was impacted by writedowns.

Revenue of $2.99 billion compared with $3.01 billion previously, while underlying earnings rose 28% on year to $544 million on a constant currency basis.

SHL said it was a strong result, despite 2H10 difficulties due to regulatory changes affecting the Australian pathology industry.

These impacts were mitigated by SHL’s increasingly diversified operations, with over 60% of revenue sourced from outside Australia.

SHL declared a final dividend of 35 cents per shares, steady on year.

On a constant currency basis, SHL expects net profit for FY11 to climb by 5%-15%.

Australian stock price for SHL finished the yesterday’s session up 3.6% to $10.80.

Australian Shares – Resmed (RMD)

Resmed (RMD) is a healthcare business, manufacturing medical products for the treatment of respiratory and sleep-disordered breathing. It is one of the companies listed in the top ASX 200.

RMD has reported a 30% increase in FY10 net profit to US$190.1 million, with revenue up 19% to US$1.1 billion.

RMD attributed the revenue growth to the market share gains in the Americas as well as the positive roll out of its new S9 Autoset and Elite flow generator products.

In addition to its result, RMD has announced a 2:1 stock split in the form of a 100% stock dividend to its shareholders.

Australian share price for RMD shares dropped 1.9% last Friday.

Healthscope (HSP) is the second largest private hospital provider, operating pathology businesses and medical centres in Australia and Asia.

HSP has recommended its shareholders accept the $2.7 billion takeover offer from the TPG-Caryle Group private equity consortium.

The offer represents a 16% premium to Friday’s closing price, and is almost 40% higher than HSP’s closing price before it received the first bid.

Encouragingly for HSP, the consortium maintained that it doesn’t plan to break up the group.

HSP Australian share price rocketed 10% yesterday following the announcement.

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Sigma Pharmaceuticals (SIP) is an Australian manufacturer of prescription, over-the-counter and generic pharmaceutical products, as well as a distributer to pharmacies throughout Australia.   SIP’s troubles of late have made it one the shares to sell.

Demonstrating its troubles, SIP recently advised it is unsure whether it will meet its budget this financial year due to the weak performance of its generics division.

SIP stated that the generics division’s earnings were $6.4 million below expectations.

In more bad news, SIP advised that proposed changes to government subsidies will add further pressure on already strained margins.

In a slightly positive development, SIP said that it has renegotiated debt facilities maturing past 2011, and is committed to clearing $100 million in debt by 31 March 2011.

SIP shares slid almost 5% on the day of the announcement, making it one of the worst performers in the Australian share market.

Stocks to Watch – Healthscope (HSP) 8 June 2010

Healthscope (HSP) is the second largest private hospital provider, operating pathology businesses and medical centres in Australia and Asia.

HSP has confirmed that US-based Tenet Healthcare has dropped its bid for the private healthcare provider.

Tenet had come under fire from analysts and shareholders who questioned the merit of the acquisition, with the speculation putting Tenet’s share price under severe pressure of late.

The withdrawal of a potential acquirer lowers the takeover tension in the battle for HSP, which was a negative for its share price.  HSP shares dipped 0.9% today.

Australian share price for HSP clearly gapped higher on two recent occasions. Selling pressure has pushed the stock down as of late, last closing down 0.9%, at $5.44 a share.

In the latest Australian stock market news, Healthscope (HSP) has received an additional two takeover offers at a price of $5.80 per share.  One of the offers is believed to be from private equity firm, Kohlberg Kravis Roberts.

HSP noted that the latest offers were equal or superior to the one put forward by a private equity consortium on May 20, which was at a price of $5.75 per share.

The latest offers could be the start of a bidding war for HSP, with the company’s main attraction being its prized private hospital operations.

HSP has advised its shareholders take no action in regards to the latest offers.

HSP has been one of the top performers in the stock market since it became the subject of takeover developments.  Its share price has risen over 20% since receiving its first offer.

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Sigma Pharmaceuticals (SIP) is an Australian manufacturer of prescription, over-the-counter and generic pharmaceutical products, as well as a distributer to pharmacies throughout Australia.

Last Friday, SIP said it had received a $707.4 million takeover offer from a mysterious bidder, pitched at 60 cents per share.

SIP later confirmed the unnamed takeover suitor was actually South African-based Aspen Pharmacare Holdings.

The deal comes after a private equity consortium bid for peer Healthscope, which also happens to be one of the sector’s hot stocks, raising speculation that private equity players are courting SIP.

Though SIP has said its underlying business is sound, the market has been demanding management improvements at SIP of late.

SIP has been suffering debt issues and has given uncertain FY11 underlying earnings guidance, so the market consensus is that the takeover deal looks good for SIP.

SIP said it is considering the proposal and recommends that shareholders take no action yet.

SIP was among the hot stocks last Friday, finished up a whopping 37% to $0.48.

Stocks to Sell 20 May 2010

Australian stock Sonic Healthcare (SHL) is an international medical diagnostics company, providing laboratory, medicine/pathology and radiology services. SHL currently has a market capitalization of $4.9 billion.

SHL has advised that it will fall short of its previous earnings guidance due to weak pathology revenues and regulatory uncertainty.

SHL now expects FY10 net profit of between $290 and $295 million, down from the previous guidance of $315 million.

Australian share price for SHL last closed at $12.62, down 0.6% for the session.