19/10/2011 | 07:00 CEST | Financial results
Stäfa (Switzerland), 19.10.2011 – Sonova Holding AG, the world’s leading provider of hearing systems, announces preliminary sales results for the first half of 2011/12 of CHF 763 million which includes a local currency growth rate of 11.4% in the hearing instruments segment. The Group unveils many new products launched at this year’s International Congress of Hearing Aid Acousticians (EUHA) in Nuremberg, Germany. Sonova also announces the outcome of the employee consultation process and the resulting decision to close the Phonak Acoustic Implants facility in Lonay, Switzerland.
Sonova announces preliminary consolidated sales of CHF 763 million for the first half of 2011/12. The hearing instruments segment generated sales of CHF 724 million, which represents a local currency growth of 11.4% over the prior half year. Organic growth accounts for 7.0% while acquisitions contributed 4.4%. As expected, a significant negative currency impact of 16.9% was caused primarily by the weakening of the USD and EUR against the CHF. The strong sales growth is due mainly to the success of the Phonak Spice and Unitron ERA platform products.
As a result of last November’s product recall, sales of CHF 39 million for the hearing implants segment were below last year’s level; however, they were above expectations following the return of Advanced Bionics’ HiRes 90K cochlear implant in mid-April to markets outside the USA. In mid-September, the company received approval from the FDA to resume selling in the USA and therefore, the H1 sales results only include several weeks of USA sales. Compared to the same period last year, when the product was sold in all markets worldwide, sales in H1 are 28.8% less in local currencies and further impacted by a negative currency impact of 11.3%.
News from the EUHA in Nuremberg
Only 12 months after the successful launch of the Spice platform Sonova’s main brand, Phonak, is introducing Spice+, which incorporates another technology step forward in sound quality, first fit acceptance and signal processing. Spice+ provides superior hearing benefits in both noisy and quiet environments thanks to the new implemented signal processing strategies. Phonak is also launching the next generation of its fitting software, Phonak Target 2.0, which is highly intuitive and requires no additional training to the hearing care professionals.
The entire current Spice product portfolio is now available on the Spice+ platform. Additionally, Phonak is introducing an entire portfolio of water and dust resistant products. The new micro-sized housings offer the highest water, sweat and dust repellent solution in the industry as well as reliable performance in every listening environment. The three new models cover a wide range of solutions: from the Phonak M H2O in three price points to the smallest Naída S CRT with an external receiver. In addition, the pediatric portfolio is now completed with Nios S H20, an extremely robust and reliable new hearing aid for children and teenagers. Complementing this new range of products, Phonak is also introducing the smallest ever custom device, Phonak nano. It virtually disappears in the ear canal and requires no special impression taking techniques. Finally, a new accessory, Phonak ComPilot, is the first multifunctional device offering the benefit of spoken alerts that simplify the interaction with the hearing aid.
Sonova’s second brand, Unitron, announces new feature enhancements to its Quantum and Moxi product families, including a new Automatic Adaptation Manager to transition hearing instrument wearers from first fit acceptance to optimal speech understanding. Wearers continually experience natural sound quality as they transition towards the ideal amplification that will provide optimal speech intelligibility. This important transition happens automatically, but is designed to be flexible so that hearing healthcare professionals have the option to customize and personalize the feature settings. In addition, a new 312 micro BTE is now available for Quantum, offering natural sound quality at three technology levels, completely wireless and in a discreet and attractive design. Finally, Unitron has also added a new remote control to its suite of accessories.
Outcome of employee consultation
As announced last month, the Group reviewed its middle ear implant activities and announces the decision to close the Phonak Acoustic Implants’ site in Lonay, Switzerland, which employs 26 people. After carefully reviewing and evaluating the employee consultation results, it was decided to close the Lonay site as part of the further consolidation of the Medical Division. “This was a difficult but necessary step to strengthen our core business. We will do our best to support the affected employees, some will be retained within Sonova in a different function and the others will be supported by professional newplacement assistance,” says Alexander Zschokke, Interim CEO of the Sonova Holding AG. Management believes that, for Sonova, the cochlear implant market provides significant better mid-term opportunities for growth and profitability than the market for middle ear implant products. Therefore Sonova will now focus on the cochlear implants business and the further development of its next generation systems.
Sonova will record one-time restructuring costs of approximately CHF 3.9 million related to the site closure. The company will also write-off the remaining capitalized R&D costs related to Ingenia, the middle ear implant under development, of CHF 4.9 million, as a one-time, non-cash impairment charge. Neither the restructuring charges nor the impairment charge impacts the full year guidance on EBITA. Sonova’s mid-term projections for sales and profitability did not include the Ingenia product and therefore, this decision does not affect the company’s outlook.
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