In H1, Sonova witnessed strong momentum/recovery across all its segments. Good momentum for Paradise and related offerings, newer innovations, and recovery in elective surgeries rendered pivotal support. This also translated into healthy profitability improvements. While management has maintained its guidance, it does not take on board the newer risks/challenges. Overall, the recent correction opens up a quick entry point, but with limited upside potential.
Companies: Sonova Holding AG
Sonova has upgraded its mid-term sales guidance on the back of sustained market recovery across key geographies and the introduction of newer and upgraded offerings. Although, the EBITA increase guidance remained unchanged. More importantly, this optimism has been reinforced despite the brewing Delta variant risks. Add on top the high-growth potential from the Sennheiser consumer division, and the firm’s sustained technological leadership in the core hearing aids business, Sonova seems attractiv
FY20/21 ended on a high with all segments and regions returning to growth in H2 – momentum was led by the strong market recovery and the successful launch of Paradise. The profitability beat was also encouraging as the group’s structural optimisation initiatives have borne fruit. Given that pent-up demand needs to be satisfied and new demand is also emerging as vaccination gathers momentum, management has shared a promising outlook for FY21/22. Re-initiation of the share buy-back programme is th
The H1 20/21 beat was driven by a strong market rebound, robust commercial execution and the successful launch of Paradise. The hearing aid wholesale business fared better than retail, though cochlear implant was a drag. Geographically, Asia-Pacific led the recovery with positive sales growth in Q2. Importantly, group sales were up in a high single-digit in September and, despite headwinds from the newly-imposed lockdowns, management has reiterated its full-year guidance on the back of the bette
Sonova has reiterated its mid-term growth strategy and financial targets. On the hearing aid wholesale side, the recovery has been faster than expected and the new product launch, Paradise, will be backed by robust commercial execution. On the retail side, store network optimisation and the omni-channel strategy will be at the forefront. The group will also focus on process improvements to generate cost savings. However, the recovery in the cochlear implants segment has been slow.
Benefiting from a faster than expected improvement in the hearing aids marketplace – the elderly population was more comfortable in going back to retail stores than anticipated – Sonova has upgraded its outlook for H1 20/21. Good reception of its recently-launched product, Paradise, also played a part. Assuming no further major lockdowns and sturdy demand for Paradise, Sonova expects to return to growth in H2 20/21. With the market stabilising, Danish rivals Demant and GN Store Nord should also
With the gradual re-opening of the markets, Sonova’s sales run-rate reached 59% (in Q1) vs. 35% in April 2020. The recovery was faster than expected and management has guided for a 65-75% sales run-rate and single-digit EBITA margin for H1 20/21. Interestingly, Sonova has accelerated its structural optimisation measures – streamlining of the retail network and optimisation of non-customer facing functions could lower the headcount by 4-5% – and these initiatives have the potential to generate an
H2 was better than expectations, led by a sturdy show in wholesale, though retail and cochlear implants lost pace due to the ongoing pandemic. Higher volumes and ASPs bolstered EBITA, though these were partly offset by an increase in the allowance for bad debts. To ensure adequate liquidity, the share buy-back programme has been suspended and management has proposed a stock dividend. Given that Sonova’s sales run-rate for April 2020 was better than Demant’s, it could be a key beneficiary when ec
Sales momentum accelerated significantly in H1, led by broad-based growth across businesses. While wholesale benefited from the success of Marvel, the momentum in cochlear implants was driven by the MRI-compatible implant. Retail was fuelled by effective lead generation management and in-store execution, leading to the financial guidance upgrade for FY19/20. Nonetheless, higher than expected R&D and sales and marketing expenses and a new restructuring charge took away some of the sheen.
After a slow start, organic sales growth accelerated significantly in H2, led by the successful introduction of the next-gen MFA product, Marvel. Geographically, Europe was the principal growth contributor which overshadowed a weak show in the US. Profits also witnessed a substantial increase, benefiting from higher volumes, favourable ASPs and supply chain optimisation. For FY18/19, organic revenue growth came in at the higher end of the guidance range and profits were in line with expectations
CVS, one of the largest healthcare and pharmacy chains in the US, has announced the closure of all of its hearing centres in the US. With the over-the-counter/OTC hearing aids regulation set to become law in 2020, the requirement of hearing loss testing and support care would be done away with and thus there would be no need for an audiologist in the new set-up, the company said. Also, as lower-priced products would dominate the market, dedicating space in stores to audiologists won’t make much
Revenues were in line with expectations as a deceleration in sales growth in the hearing instruments wholesale business was offset by a pick-up in momentum in the retail division. However, declining ASPs, resulting from a mature product portfolio and stiff competition, suppressed profitability. With a new product now out in the market, ASP’s should improve and thus bolster the top-line as well as profitability in the second half of the year.
Impacted by challenging market conditions in the US wholesale (competition) and retail business (repositioning of stores), Sonova reported FY17/18 organic sales growth (+3.8%) below the mid-term target range of +4-6%. However, as the next-gen SWORD product (launch expected in Q4 18/19) is likely to be a game-changer, we anticipate an acceleration thereafter.
Though the H1 17/18 results were slightly below the street’s estimates, we believe that the launch of the 2.4GHz MFA platform should provide the much needed push to organic growth in the short term and help the company achieve its FY17/18 revenue and profitability targets. However, the mid-term growth prospects hinges upon the success of the next-gen product (likely in FY18/19) which is likely to address the shortcomings of the current product offering (ear-to-ear streaming and rechargeability).
Sonova’s H1 16/17 numbers (slightly below consensus estimates) confirmed continuing sluggishness due to AudioNova’s acquisition and an ageing product cycle. Sales grew at a slower pace of 5.5% in LC (6.7% in CHF) vs. 6.7% in H1 15/16 to CHF1.1bn, albeit slightly better than the 4.8% in H2 15/16. Even this growth primarily (3.5%) came from acquisitions, while the organic number languished at 2% (H1 15/16: 2.6%). On a segmental basis, Hearing Instruments (HI) and Cochlear Implants (CI) grew by 5.4
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A very positive trading update from SDI Group justifies upgrading FY 2022 sales by 7% (£2.8m) to c.£45m. Part of this can be explained by a stronger-than-expected performance from Monmouth Scientific (acquired in H2 FY 2021) and slightly higher Atik sales, but the majority is attributable to strong growth across its broader business portfolio, with sales in these businesses estimated to have risen c.16% in H1, supporting earlier comments that order patterns were returning towards pre-pandemic no
Companies: SDI Group plc
SDI reported a strong set of interim results to 31 October that were in line with its trading update of 4 November, reporting an 89% increase in adjusted pre-tax profit, driven by 75% revenue growth. Organic growth of 42% benefited from peak shipments under the Atik OEM contract, expected to be completed by January, without which underlying business growth was still an impressive 24%. We leave our forecasts unchanged for now, but consider the prospect of upward revisions based on trading and acq
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Companies: Oncimmune Holdings Plc
Today’s update reveals many of the challenges flagged in September have persisted. Alongside rising input/logistics costs, and volatile customer ordering, revenue guidance has been reduced by 10%. We have rippled a similar reduction through to FY22, leading to EPS downgrades of 27% this year and 38% next year. The company continues to look to 2022 with confidence, and maintains its medium term ambitions for profitable expansion.
Companies: Venture Life Group Plc
CareTech is a specialist social care and educational services provider. This morning, the group has released full year results to 30 September, very much in line with October's year-end update and illustrating a highly creditable performance in what has been a very challenging market backdrop for care operators brought about by the pandemic. Strong cash generation in the year reduced the net debt to EBITDA ratio to 2.7x, while the upward valuation of the group's freehold and long leasehold prope
Companies: CareTech Holdings PLC
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Companies: SkinBioTherapeutics Plc
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Companies: Fusion Antibodies Plc
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Companies: CVS Group plc
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Companies: Poolbeg Pharma Ltd.
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