Convatec delivers higher 1H profits, raises full-year guidance

2nd Aug 2023 08:18

(Sharecast News) - Convatec's profits rose over the first six months of the year, leading the medical products and technologies company to raise its guidance.

For the half ending on 30 June, operating profits vaulted higher by 41.7% to reach $123.4m on a reported basis, even as sales edged up by just 1.1% to $1.06bn.

"This performance demonstrates the momentum Convatec is building - revenue growth is accelerating and we are expanding our operating margin, despite ongoing investments to drive future growth and the challenging inflationary back drop," said Karim Bitar, the group's chief executive officer.

"Given the strength of performance and the encouraging outlook, particularly in [Advanced Wound Care], we are increasing our guidance for the full year."

Adjusted operating profits on the other hand were up by a more restrained 7.0% at constant currencies to $214.1m.

Leverage rose during the period to 2.5 times adjusted earnings before interest, taxes, depreciation and amortisation, versus 2.1 in the year earlier period.

Management raised its guidance for full-year organic revenue growth from 5.0-6.5% to 6.0-7.5%.

Its adjusted operating profit margin was now pegged to reach at least 20.5% in 2023 on a constant currency basis, versus the 19.7% previously guided to.

The company raised its interim dividend payout by 3.0% to 1.77p per share.

As of 0932 BST, shares of Convatec were advancing by 2.33% to 210.60p.