Cochlear Limited researches, develops and markets cochlear implant systems for hearing impaired individuals. The Company's hearing implant systems include Nucleus and Baha and are sold both domestically and internationally.
COH, a holding in the Value strategy, reported its interim results and pleasantly surprised a market – in a terrible day for the broader market as investors fret over the invasion of Ukraine by Russia – that was expecting a downgrade to earlier guidance. Despite COVID restrictions in its key markets, COH was able to maintain its full-year profit guidance and increase its interim dividend by 35% to $1.55 per share. Key highlights of the half-year were:
- Sales revenue increased by 12% in constant currency to $815m
- Underlying net profit increased 26% to $158m on the back of improved gross margins
- FY22 underlying net profit guidance has been maintained at $265m-$285m, an increase of between 13-22% on FY21
- A payout ratio of 65%, an increase from 61% last year and a good sign of the board’s confidence that the impact from the pandemic is largely behind the company
The stock is up almost 10% on the back of the announcement as the market’s worst fears have been allayed, and COH’s status as a safe haven is hopefully restored going forward. The stock remains a hold as part of the Value strategy.
