Diss-based CVS Group reveals bold European expansion plans amid changing veterinary industry
PUBLISHED: 06:00 04 May 2016
Archant Norfolk Photographic © 2016
Veterinary giant CVS Group is eyeing expansion into Europe as it builds on the most acquisitive year in its history.
The Diss-based group has taken on more than 50 practices in the past year to take its total holding to 349, as it capitalises on vets’ dwindling desire to own their own surgeries.
Revelation of the EDP Top100 firm’s ambition comes as half-year revenues for the period ending December 31 2015 reached £100m for the first time in its 17 years.
Chief executive Simon Innes said the business could double in size within the next five years, with Holland and Ireland particular targets.
He added: “I think the growth is going to go on for a lot longer. We have nothing in Northern Ireland. We are hoping to buy our first practice there in June. Hopefully it will be the start of many more.”
CVS Group’s growth signals a change in the way veterinary practices are operating, with fewer younger vets willing to commit to owning a practice, and experts saying younger vets see it as a job rather than a vocation.
This means larger groups offering greater buying power and back office support are an attractive prospect to independent practices. “Partners want to slow down or retire,” said Mr Innes. “It means they can sell the practice, get a lump sum for their life’s work and then come back to work the following day as an employee and work as a vet, which is what most vets became vets to do.”
The company, which employs more than 4,100 people, has grown through the acquisition of veterinary practices, hospitals and laboratories and pet crematoria since it was founded in 1999, and floated on AIM in 2007.
While it has a growing market share in pets - at 12pc - Mr Innes said they were still relatively “small players” in the equine and agricultural animal sector, with below 1pc of market share.
Plans to grow this side of the business saw CVS buy Scott-Dunn’s Equine Clinic, which looks after the Queen’s horses at Windsor, in 2006.
And while further acquisitions will be the main driver of future growth, this year a step-change has seen CVS open its first practice from scratch, and a £4m investment in a new specialist hospital in Hampshire followed.
It also plans to launch a pet insurance plan early next year.
Acquisition value was usually about 70pc of a practice’s annual revenue, said Mr Innes, with growth financed by a mixture of cash flow and debt.
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