Cochlear shares slump on word of weaker sales

Shares in Cochlear Limited (ASX:COH) fell over 15% after the company revealed it has been tracking weaker sales during the second half of FY13.

The company is now forecasting net profit for the full year of between $130 million and $135 million.

This would be a marked improvement on the $56.8 million in profit Cochlear reported for FY12. But those results were impacted by more than $101 million in costs associated with the major recall of one of its cochlear implants.

Cochlear attributed the weaker sales to the lead-up period to the launch of its new Nucleus 6 line of sound processor products.

The company has meanwhile commenced a staggered launch of Nucleus 6, starting with the two markets where the product is approved - Canada and Korea.

The first major launch event was held at last month’s European Symposium of Paediatric Cochlear Implantation in Turkey.

The company has followed this up with an Asian launch at the International Federation of Oto-Rhino-Laryngological Societies in Korea and plans a Canadian debut later this month.

Cochlear revealed it expects to receive European approval for the product shortly and US approval this calendar year.

Nucleus 6 is an adaptive sound management system which includes wireless connectivity and integrated hearing aid functionality. It contains an auditory scene classifier, designed to analyse the sound environment and apply the most suitable sound processing technology.

Cochlear said it has been developing the chipset used in Nucleus 6 products for over six years.

Cochlear shares were trading 15.2% lower at $54.73 as of around 2 pm on Monday.