Sonova stabilizes in the first half of 2024/25
Published: Tuesday, Nov 19th 2024, 08:30
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Hearing aid manufacturer Sonova stabilized as expected in the first half of the 2024/25 financial year. However, profitability suffered from temporarily higher costs. New products should now provide momentum in the second half of the year.
Specifically, the company from Stäfa in Zurich, known for its Phonak brand, increased sales by 4.6% to CHF 1.83 billion in the first half of 2024/25 (as at the end of September), as Sonova announced on Tuesday. Adjusted operating profit (EBITA), however, fell by 7.1 percent to 325.2 million (-3.7% in local currencies). The corresponding margin fell to 17.7 percent (previous year: 20.0%).
The bottom line was a net profit of CHF 211.7 million (previous year: CHF 249.6 million). With this result, Sonova exceeded analysts' expectations (AWP consensus) in terms of sales, but fell well short in terms of profitability.
Profitability suffers from one-off costs
However, it was already clear that profitability would come under pressure. The company had to bear high marketing expenses and product launch costs for the new hearing aid platform. There were also additional costs for measures to optimize operating structures, including the construction of a new factory in Mexico.
But the effort seems to have paid off. The hearing aid manufacturer has made a successful market launch with the introduction of its new AI-based hearing aid platforms Infinio and Sphere Infinio.
As the company announced in a separate presentation, the Phonak brand was able to increase its market share in the commercial segment in the USA by around 5 percentage points in the first two months following its launch. However, the impact of the launch on the half-year figures is still small.
Outlook confirmed
For the full year 2024/25, Sonova is now still aiming for consolidated sales growth of 6 to 9 percent and adjusted EBITA growth of 7 to 11 percent. This is also in line with the Group's medium-term targets. Taking into account exchange rates as of the beginning of November 2024, Sonova expects a negative impact of 1-2 percentage points on reported sales growth in Swiss francs for the financial year 2024/25.
The second half of the year should be much more dynamic than the first due to the good market launch of the new hearing aids. In addition, Sonova recently signed a new contract with the wholesaler Costco in the USA. This is of great importance as, according to analysts, around 15 percent of hearing aids in the country are sold through this chain of stores.
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