Weaker than expected growth for Alcon in the third quarter
Published: Tuesday, Nov 12th 2024, 19:50
Updated At: Wednesday, Nov 13th 2024, 09:20
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The ophthalmology group Alcon continued to grow in the third quarter, but not quite as strongly as expected. The targets for the year as a whole were also lowered slightly.
Alcon missed analysts' expectations in the third quarter. The Swiss-American company achieved a turnover of 2.43 billion dollars between July and September. This corresponds to an increase of around 6 percent, as the company announced on Tuesday, exceptionally after the close of trading in Switzerland. As a result, the shares were temporarily suspended from trading on the US stock exchange.
Contact lenses work well
In terms of divisions, Alcon grew by 7% to 1.10 billion dollars in the "Vision Care" segment, with the contact lens business growing in particular. In the second segment, "Surgical", growth was somewhat lower at 5 percent to 1.34 billion.
Alcon did not quite meet average expectations in terms of profitability either. At 20.6%, the core margin as a measure of profitability was above the previous year's figure (previous year: 19.5%), but slightly below average expectations.
CEO David Endicott is satisfied with the cash flow generated. Specifically, net cash flow from operating activities amounted to USD 1.6 billion in the first nine months of 2024, compared to USD 937 million in the same period of the previous year.
Forecasts lowered
Following somewhat less dynamic growth, Alcon has slightly lowered its forecasts for the year as a whole. Alcon now aims to achieve sales of 9.8 to 9.9 billion dollars in 2024, slightly less than previously. The operating profit margin is expected to be between 20.5 and 21.0 percent, which means that the upper end of the forecast has been lowered slightly.
UBS is also assuming slight adjustments to consensus expectations and expects the share to react negatively on the stock market. Shortly after the opening of trading in Zurich, the share is down by just over 1 percent.
CEO David Endicott was optimistic following the figures. However, his focus is already on the coming year, in which Alcon should once again grow faster than the market, as he said in an interview with "Finanz und Wirtschaft". He also expressed confidence with regard to the 2027 targets.
Endicott therefore expects further growth in the contact lens business in the future. The Chinese market is likely to contribute to this.
On the subject of acquisitions, he said that the Group could certainly act more aggressively, but did not have to. "It takes patience, sometimes two years to close a deal," said the CEO. "The challenge is timing and finding something with our price expectations that supports organic growth."
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