Cochlear shares skid as US growth slows

Hearing implant company Cochlear says its profits have risen 16 per cent to $128.6 million, but its shares have plunged after it said its growth in US and Europe has slowed.

AAP

19 February 2019

Mentioned: Cochlear Ltd (COH)

Profits are up but shares are down at hearing technology firm Cochlear

Hearing implant company Cochlear says its profits have risen 16 per cent to $128.6 million, but its shares have plunged after it said its growth in US and Europe has slowed.

The company said its sales revenue was up 11 per cent (6 per cent in constant currency) to $711.9 million.

The company declared an interim dividend of $1.55, an increase of 11 per cent on last year.

"Cochlear continues to target the delivery of consistent revenue and earnings growth over time," chief executive Dig Howitt said.

The company said it was experiencing strong growth in Japan but lower growth in the US and Europe, particularly German, after a competitor launched its product.

The company derives nearly half its revenue from the Americas and sales were up just 3 per cent on a constant currency basis there.

Cochlear shares were down 8.5 per cent to $177.97 at 3:30pm.

The company also declared a contingent liability involving litigation with the Alfred E. Mann Foundation for Scientific Research and Advanced Bionics LLC.

A US federal court in November awarded them $US268 million ($A375m) against Cochlear in a long-running patent dispute.

The company is appealing the decision and says if the appeal is unsuccessful the company expects to be able to access debt facilities to fund it.

Since the patent at issue at expired the litigation doesn't affect Cochlear's current portfolio.

Sydney-based Cochlear has sold more than 550,000 implants to people around the world with moderate to profound hearing loss. Its latest model allows users to control it from their smartphone.

Cochlear H1 profit lifts

Half-year net profit up 16pc to $128.6 million
Revenue up 11pc to $711.9 million
Interim dividend up 11 pc to $1.55, 100 per cent franked

AGEING POPULATION

BIOTECH

COCHLEAR

AUTHOR

AAP
provides Morningstar with market news.

	Last	$ Change	% Change
Cochlear Ltd COH	$290.77	1.69	+0.58%

© 2024 Australian Associated Press Pty Limited (AAP) or its Licensors. This is the Morningstar service with content provided by AAP where indicated. AAP reserves all rights, including copyright, in services provided by it. The information in the service is for personal use only, does not constitute financial product advice (whether general or personal) and may not be re-written, copied, re-sold or re-distributed, framed, linked or otherwise used whether for compensation of any kind or not, without the prior written permission of AAP. You should seek advice from a professional financial adviser before making decision to acquire or dispose of a financial product.

This service is published for general information purposes only without assuming a duty of care. AAP is not in the business of providing financial product advice (whether personal or general advice), and gives no warranty, guarantee or other representation about the accuracy of the information or images contained in this service. AAP is not liable for errors, omissions in, delays or interruptions to or cessation of the services through negligence or otherwise. The globe symbol and "AAP" are registered trademarks.