Cochlear’s Shares Rose 7.8% On ASX Post Announcement of Nucleus® Profile Launch

Cochlear’s Shares Rose 7.8% On ASX Post Announcement of Nucleus® Profile Launch

Cochlear Limited (ASX:COH) is in the healthcare sector with its operations in innovating and presenting the market with a spectrum of implantable hearing solutions that deliver a lifetime of hearing outcomes.

The launch of the Nucleus® Profile™ Plus Series implant has been announced by the company today, on 16th April 2019, with the series being designed for routine 1.5 and 3 Tesla magnetic resonance imaging scans without the requirement of removing the internal magnet. It will be commercially available initially in Germany, and other European countries will follow going forward. Subject to the timing of regulatory approvals, the series implant launch is expected across other developed markets as well.

The company in the recent past has announced that the criteria that health professionals use while determining who is suitable for a cochlear implant within the National Health Service has been expanded by National Institute for Health and Care Excellence (NICE). The eligibility criteria was changed to equal or greater than 80 decibels hearing loss at two or more frequencies without using hearing aids. With these changes it is expected that the number of people in the United Kingdom will double, who can now have access to cochlear implant.

On the financial front, the company reported its half-yearly results for H1 FY19. The reported sales revenue increased by 11% (6% in CC) to $711.9 million, while total expenses increased by 8% (5% in CC) to $531.3 million. As a result, the business generated an EBIT increase of 10% (11% in CC) to $177.0 million, with the EBIT margin remaining stable at 25%. The company reported a net profit of $128.6 million, which is an increase of 16% on HY18, however the increase was 11% post adjustment of the impact of the deferred tax asset revaluation in HY18. The operating cash flow stood at $164.1 million an increase by $71.4 million. An interim dividend of $1.55 was declared by the Board of the company, representing an increase of 11% from the last year.

As per the guidance provided by the company, the revenue growth will be driven by the services business, with strong uptake of the Nucleus 7 Sound Processor, particularly in the first half. The company will continue its investment to retain market leadership and drive long term market growth with the target of maintaining the net profit margin.

On the price-performance front, the stock of Cochlear Limited, at market close on 16 April 2019, was trading at $180.760, an increase of 7.85% during the day’s trade with a market capitalisation of $9.67 billion. The stock has generated a negative YTD return of 4.18% and returns of 9.66%, 9.80% and 7.45% over the past six months, three months and one-month period, respectively. Its 52-week high price stands at $221.440, and 52-week low price stands at $155.220, with an average trading volume of 219,329.


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