Turnover & gross profit up for Drive DeVilbiss Healthcare as mobility giant reports £6.05m loss in 2018
With both turnover and gross profit up, mobility giant Drive DeVilbiss Healthcare has reported a substantially lower loss in 2018 of £6.05 million to the previous year as it reaped the rewards of its Sidhil acquisition.
The manufacturer, wholesaler and distributor of a vast range of mobility equipment reported in its latest annual report an increase in turnover of just under five percent, growing from 2017’s £100.2 million to £105.02 million in 2018.
The increase in turnover resulted in a five percent gross profit rise for Drive DeVilbiss Healthcare, growing to £33.64 million against £32.01 million in 2017.
According to the company’s strategic report, the growth in both turnover and gross profit was “primarily driven by the acquisition of Sidhil Group Limited on the 6th January 2017,” leading to a restructuring of Drive DeVilbiss Healthcare’s activities, “with a focus on the specific revenue channels of service, retail, and non-retail.”
A leading manufacturer of hospital and home health care furniture and accessories, Drive DeVilbiss Sidhil reported a significant increase in its profits for the year ended 31st December 2018 to over £4million.
The increase in both turnover and gross profit led to a significant reduction in the loss the company made in the year ended 31st December 2018, with profit before taxation amounting to a loss of £5.86 million, contrasting 2017’s £30.95 million loss – with a considerable amount of 2017’s loss largely attributed to non-recurring costs incurred from the acquisition of Sidhil.
After taxation, the global mobility player reported a loss of £6.05 million in 2018.
Making an operating profit of £300,000 in 2018, the company’s strategic report highlighted the increasingly competitive nature of the mobility, independent living and healthcare market, particularly around price and product quality.
According to Drive DeVilbiss’ strategic report, the result of the mounting competition had not only been “downward pressure on margins,” but also a “risk that customer’s expectations may not be met.”
Despite this, Drive DeVilbiss’ EBITDA margin, a measure of its operating profitability, increased marginally to 8.3 percent in 2018 compared to 7 percent in 2017.
Drive DeVilbiss’ also addressed the uncertainty that the UK’s departure from the EU has given rise to, confirming that Brexit is unlikely to represent a risk to its ability to trade effectively, with the company highlighting that its business trades in the UK with relatively minor cross border activity with the European Union.
Out of the company’s £105.02 million in turnover, £99.21 million was generated in the UK.
The annual report for the year ended 31st December 2018 follows a Wall Street Journal report in September 2019 that Drive DeVilbiss Healthcare’s North American business was facing a “liquidity crunch.”
Later in the same month, Drive DeVilbiss Healthcare confirmed it had reached an agreement with its lenders and private equity owner Clayton, Dubilier & Rice (CD&R), securing $35 million in new capital, alongside a reduction in cash debt service obligations from its current lenders.
Hailing the backing as a testament to the confidence shared in its strategic vision, Bob Gilligan, Chief Executive Officer of Drive DeVilbiss Healthcare, commented at the time: “We are pleased with the strong demonstration of support that our stakeholders have shown to our business and strategic vision.
“The new capital and associated capital structure enhancements will enable Drive to continue to invest in improving our infrastructure to deliver high-quality service to our customers, while also providing an additional runway to execute on our business plan supporting continued growth.”
Manufacturing an extensive range of mobility aids, including mobility scooters, wheelchairs, walking aids, beds, moving and handling equipment, aids for daily living and more, Drive DeVilbiss Healthcare is one of the industry’s largest equipment suppliers.
The organisation was formed in 2015 following the Drive Medical’s acquisition of DeVilbiss Healthcare. In August 2016, the company was bought by CD&R for an alleged $800 million from private equity firm Ferrer Freeman & Company.https://thiis.co.uk/turnover-gross-profit-up-for-drive-devilbiss-healthcare-as-mobility-giant-reports-6-05m-loss-in-2018/https://i1.wp.com/thiis.co.uk/wp-content/uploads/2019/11/drive-devilbiss-healthcare-head-office-featured.jpg?fit=725%2C389&ssl=1https://i1.wp.com/thiis.co.uk/wp-content/uploads/2019/11/drive-devilbiss-healthcare-head-office-featured.jpg?resize=150%2C150&ssl=1NewsroomSupplier NewsTrade Newsacquisition,annual reporr,CD&R,Clayton Dubilier & Rice,Drive DeVilbiss healthcare,Drive DeVilbiss Sidhil,EBITDA,Ferrer Freeman & Company,liquidity crunch,mobility equipment,operating profit,private equity company,turnover,Wall Street JournalWith both turnover and gross profit up, mobility giant Drive DeVilbiss Healthcare has reported a substantially lower loss in 2018 of £6.05 million to the previous year as it reaped the rewards of its Sidhil acquisition. The manufacturer, wholesaler and distributor of a vast range of mobility equipment reported in...Calvin BarnettCalvin Barnettcalvin@thiis.co.ukAdministratorTHIIS Magazine