Cochlear reports record full year results

Cochlear released its full year results today reporting a 19 percent increase in net profit to $155.2 million on the back of record total revenues of $784.8 million.

The company reported Cochlear implant (CI) sales, including accessories and sound processor upgrades, of $603.7 million, down 2 percent, up 13 percent in constant currency.

A total of 21,023 implants were sold during the year, a 20 percent increase on the previous 12 months. This was largely driven by the launch of the new Cochlear Nucleus 5 implant in the first half. The majority of implants sold in the second half of the year were of the Nucleus 5. Sales of the Cochlear Baha 3 complete hearing system, currently being launched in major markets, were up nine percent to $92.5 million.

US sales provided the biggest boost to the overall result, up 18 percent to $307.6 million, followed by the EMEA (Europe, Middle East and Africa) where sales increased seven percent to $291.5 million. Sales to the Asia Pacific increased five percent to $97.1 million, which included 500 units sold into China as part of a donation program. Cochlear also reported a foreign currency gain of $38.6 million.

R&D spend fell two percent to $94.9 million for the year. This contributed to margin expansion with EBIT/Total Revenue improving four percent to 30 percent. Cochlear declared a final partially franked dividend of $1.05 (franked to 60 percent) to be paid in September. The full dividend for the year was up 14 percent to $2.00.

The result was roughly in line with market expectations, however it faield to impress investors with the stock shedding almost two percent to close today at $69.86. Analysts noted that Cochlear’s refusal to give much guidance for future results was a key reason for the negative reaction.

Speaking about the results on Australian television on Tuesday, Cochlear CEO Dr Chris Roberts noted however, that the company expects to realise a higher level of product innovation over the next few years following the completion at the end of this year of its new global headquarters at Macquarie University.