Cochlear (ASX: COH) has continued to hike its dividend as the business returns to pre-covid form. The company's stock opened 4.2% higher as the market opened.
Half-year financials at a glance:
Revenue of $815.3m, up 10%
Underlying net profit of $157.5m, up 26%
Net profit after tax (NPAT) of $169.3m, down -28%
Interim dividend per share of $1.55, up 35%
The profit result was ahead of Bloomberg estimates of $126.6m and beat Bell Potter expectations of $140.9m.
Cochlear recorded a 7% increase in implant units to 18,598 in the first-half. The decline in developed markets was offset by strong growth in emerging markets.
Unit volumes declined 2% for developed markets, but remain well ahead of pre-covid levels. Volume declines were most notable in the US due to hospital staffing shortages in the second quarter.
For the emerging markets, unit volumes jumped around 30% with a strong recovery from covid-related deferrals experienced across most countries.
For perspective, developed markets contribute roughly 80% of global sales with the remaining 20% from emerging markets.
Its encouraging to see Cochlear's gross margins improve 2 percentage points to 19%, ahead of the company's 18% longer-term target.
The improvement in underlying profits was driven by strong top-line growth, improved margins and the benefit of lower-than-expected operating expenses.
Net profit after tax (NPAT) in the first-half of FY21 were bolstered by one-off gains including a $59m patent litigation tax and $17.2m in covid government assistance.
Cochlear expects FY22 net profit to be between $265m and $285m, a 13-22% increase compared to FY21.
Cochlear flagged that hospital staffing shortages may impact implant capacity in the second half. As a result, the company expects a lower rate of growth for Cochlear impacts for the full year.
Finance Writer & Social Media
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