Paradise among factors brightening Sonova financial estimate despite COVID

 

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A bright guidance for the first half of the 2020/21 financial year has been beamed out by the Swiss hearing solution giant, Sonova, possibly indicating faster industry-wide recovery from COVID than expected.

Though events in the coronavirus strategy saga may yet pin back market optimism, the cheery tone set by Sonova in its June update has been continued in its latest estimate. The group expects a return to growth in the second half of the 2020/21 financial year, while it estimates sales for the first half of FY 2020/21 to "reach around 79% of the prior year level at constant exchange rates and to achieve an adjusted EBITA (Earnings before interest, taxes, and amortization ) margin in Swiss francs of approximately 15% for the same period".

Recovery, says the group, is fuelled by a good response from the global hearing care market to COVID-19 pandemic impacts, and the new Phonak Audéo Paradise platform, released on August 19. Significantly, Sonova's march back to health is led by Asia-Pacific sales, with around 4% growth. US sales were close to 10% lower than the prior-year level, says the company.

“During the past months, our business has performed above expectations, driven by a strong product portfolio, the successful execution on our growth and productivity initiatives, and supported by improved market conditions. This was only possible thanks to the dedication of our employees and swift action throughout our company to address the current market challenges," said Sonova CEO, Arnd Kaldowski.

"Supported by the successful launch of our new Phonak Paradise platform, we expect to return to positive growth in the second half of our business year," continued Kaldowski.

However, both the strengthening of the Swiss franc and the current exchange rate situation sees Sonova reckoning on a 4% reduction in reported sales growth and a 10% hit on its 2020/21 EBITA growth in CHF.

Source: Sonova

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