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2005 Annual report - Virbac

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30<br />

on 29 April <strong>2005</strong>, and those for 2004 on 30 August <strong>2005</strong>.<br />

The main suits (investigation by the Securities exchange<br />

commission and a class action suit by shareholders) were<br />

settled;<br />

◆ The bid in December <strong>2005</strong> to buy the shares in the US<br />

subsidiary <strong>Virbac</strong> Corporation not already held, namely<br />

39.7% of the share capital at a price of 4.15 US dollars<br />

per share, representing a total purchase price of around<br />

37 million US dollars;<br />

◆ The continued improvement in the Group’s financial<br />

position with consolidated net debt falling to<br />

€14.8 million, namely 10% of Group shareholders’ equity<br />

compared respectively to €37.9 million and 31% at<br />

end 2004.<br />

Business activities in <strong>2005</strong><br />

Pro forma at constant exchange rates, Group sales rose by<br />

4.9% in <strong>2005</strong>, with growth in both segments: +7.5% in the<br />

companion animal market, +2.2% in the food producing<br />

animal business.<br />

Trends per segment<br />

Companion animals<br />

This business accounts for 63% of Group sales. All segments<br />

helped grow sales except for electronic identification, which<br />

had a particularly strong 2004.<br />

❖ Parasiticides<br />

This segment grew by 17.8% on 2004.<br />

This performance largely stemmed from the US subsidiary’s<br />

success with Iverhart+ ® (wormer for heart worms) which<br />

benefited from an extension in its use-by period and the<br />

withdrawal from the market at end 2004 of a competing<br />

product.<br />

In Europe, growth was driven by the strong performance<br />

of collars and external parasiticides, as well as the launch<br />

of Preventic ® spot-on (external parasiticide treatment) in<br />

Germany.<br />

In Latin America, <strong>Virbac</strong> Brazil successfully launched a local<br />

range of external and internal parasiticides.<br />

❖ Immunology<br />

This business grew by 5.5% in <strong>2005</strong>.<br />

Despite strong competition in the dog vaccine market,<br />

Group sales rose on the back of Germany in Europe,<br />

Colombia and Mexico in Latin America and Australia<br />

in the Pacific. The decline in sales in France can be explained<br />

by the tailing off of the vaccination drive that followed<br />

the discovery of a case of canine rabies in southern France<br />

in 2004. In Europe, the cat vaccine business faced fierce<br />

competition following the launch of a new range, but <strong>Virbac</strong><br />

undertook a series of major campaigns that enabled it to<br />

protect its positions.<br />

Sales of Virbagen ® Omega (leading interferon in the<br />

veterinary market) rose across Europe but particularly in<br />

the United Kingdom which benefited, more than other<br />

countries, from the extension of the marketing authorisation<br />

to cats.<br />

❖ Antibiotics/Dermatology<br />

These ranges grew overall by 3.4% on 2004. In dermatology,<br />

sales of Epi-Otic ® (ear cleanser) performed well in all areas.<br />

The antibiotic segment also grew thanks to the launch of<br />

Rilexine ® (marketed under the Rilexipet ® brand) in Japan<br />

and this product’s strong performance in Spain. In France,<br />

<strong>Virbac</strong> caused a stir by launching, at the end of the year,<br />

the new version of Rilexine ® palatable tablets with the total<br />

compliance programme and the goal of regaining its<br />

leadership position in this segment and is getting ready<br />

to launch it in the main European markets in early 2006.<br />

❖ Specialities<br />

Specialties, which includes the dental range, anaesthetics,<br />

ophthalmologic products, anti-inflammatories,<br />

endocrinology and reproduction, saw a 12.2% rise in <strong>2005</strong>.<br />

The dental range saw strong growth in <strong>2005</strong> on the back of<br />

a very strong performance in America where the animal<br />

dental care market is expanding rapidly. Asia also<br />

contributed to this strong performance with the launch of<br />

dental care chews in Japan. The launch of a competing<br />

dental range in Europe resulted, on the other hand, in a<br />

slight decline in sales.<br />

The anaesthetic range profited from the success of Zoletil ®<br />

(general anaesthetic) which saw double-digit growth in<br />

<strong>2005</strong>.<br />

Sales of ophthalmologic products rose thanks to the launch<br />

of VT Phak eyes in May <strong>2005</strong> (ophthalmologic drops) and<br />

Regefluid ® as a replacement for Humiscreen (artificial tears)<br />

in May <strong>2005</strong>.<br />

The anti-inflammatory and motricity function range owes its<br />

growth to the strong performance of Fortiflex ® (nutritional<br />

supplement used for motricity function disorders) in France<br />

and Japan where a version enriched with two new<br />

ingredients was launched in <strong>2005</strong>.<br />

The strong growth in the endocrinology range stems from<br />

strong sales of Soloxine ® in the United States (hormone<br />

against canine hypothyroidism) which regained its<br />

leadership position in the market in <strong>2005</strong>. Lastly, the<br />

reproduction range rose slightly in <strong>2005</strong>, following a<br />

slowdown in the growth in sales of Alizine ® (contraceptive<br />

for cats and dogs).

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