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Highlights:
- Cochlear Limited (ASX:COH) shares ended higher on Wednesday after the company reported 9% increase in revenue in FY23.
- The company declared an interim dividend of AU$1.55 per share.
- In FY23, the company maintains its expectations to achieve underlying net profit between AU$290- AU$305 million.
Implantable hearing solutions provider Cochlear Limited (ASX:COH) announced its HY2023 results ended 31 December 2022 today (15 February 2023). The company reported a 9% jump in its revenue while maintaining net profit guidance for the current fiscal, leading to a sharp jump in its share price. COH shares ended 7.75% higher at AU$225.28 today after trading in positive territory throughout the day.
| Company Name | Market Price (AU$) |
Market Cap (AU$) |
Yearly Return (%) |
Dividend Yield (%) |
PE Ratio (x) |
YTD (%) |
52W High (%) |
52W Low (%) |
|
|---|---|---|---|---|---|---|---|---|---|
| COCHLEAR FPO [COH] | 225.28 | 14.819B | 10.00 | 1.42 | 48.08 | 2.43 | 236.43 | 184.62 | |
*Data powered by Morningstar®. Data delayed 20 minutes unless otherwise indicated. Read More
as of 15/02/2023, 06:01:18 PM AEDT
Cochlear’s sales revenue rose 9% (7% in constant currency) to AU$893 million, propelled by strong growth in cochlear and acoustic implant revenue. There was a 14% improvement in the company’s implant unit on the back of robust demand for the Cochlear™ Nucleus® 8 Sound Processor.
During the period, the Group’s statutory net profit declined 16% to AU$142 million, because of one‐off gains recorded in the previous fiscal. Meanwhile, its underlying net profit fell 10% (6% in CC) to AU$142 million, and underlying EBIT fell by AU$31.9 million to AU$185.7 million. This was because of investments made in cloud computing, new product unveiling costs and the effect of the rise in operating expenditure towards the latter half of FY2022.
The company’s underlying net profit margin prior to the effect of cloud computing‐associated expenditure was 17%, litter less compared to the 18% long‐term goal.
Cochlear's progressive on‐market share buy‐back program will begin in March to gradually lower the cash balance to around AU$200 million over a few years. This program matches the current dividend policy, which aims for a 70% payout of the company’s underlying net profit.
Cochlear Limited (ASX:COH) interim dividend
The company declared an interim dividend of AU$1.55 per share in accordance with the previous year and representative of a payout of 72% of underlying net profit.
COH shares will go ex-dividend on 21 March 2023, and the record date for deciding the eligibility of shareholders for receiving the above dividend is 22 March 2023. The dividend amount will be paid on 14 April 2023 to the eligible shareholders.
FY23 Outlook
In FY23, the company maintains its expectations to achieve underlying net profit between AU$290- AU$305 million, which is a 5-10% growth over FY22 underlying net profit and a rise of 8-13% when adjusted for the elevated cloud computing expenditure. Cochlear expects to report a robust increase in sales revenue and nearly 18% underlying net profit margin prior to cloud computing costs.
Cochlear would keep on investing in R&D and market growth endeavours to maintain long-term market growth. Cloud computing-related investment is estimated to pick up in FY23 to approximately AU$36 million (AU$25 million post-tax), AU$14 million increase (AU$10 million post-tax) on FY2022. Capital expenses are likely to be about AU$100 million.
