Medical products firm raises full year forecast on strong interim performance

X The Business Desk

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ConvaTec, the Deeside medical products firm, has broken the $1bn turnover barrier with its results for the six months to June 30.

Revenues of $1.008bn compared with $908m the previous year. Pre-tax profits of $112.1m were up from $81.5m in 2020.

The dividend of 1.717 cents per share remains the same as last year.

ConvaTec said the 11% rise in sales was ahead of its expectations. It was driven by by particularly strong growth in advanced wound care, against the weak COVID-depressed comparative, coupled with good growth in infusion care and solid performances in continence and critical care and ostomy care. Continence care was also strengthened with the acquisition of Cure Medical.

Cure Medical is a California-based manufacturer and distributer of catheter-related supplies. The deal was worth an initial payment of $85.1m, with a further $10.0m payable depending on post-acquisition performance targets.

The company has updated its 2021 full year outlook, saying it expects organic revenue growth of between 3.5-5%, up from its previous prediction of between 3-4.5%.

Chief executive, Karim Bitar, said: “I am pleased with our continued strategic progress, on delivering another semester of good growth and on the underlying performance of the group, notwithstanding that the financial performance was helped by the COVID-impacted quarter two comparative.

“Our ongoing strategic transformation remains on track, and we have made progress during the period.”

He added: “Whilst we are mindful of relatively tougher comparatives in the second half and the continuing COVID uncertainty, particularly in Asia Pacific and Latin America, we are updating our full year organic revenue growth expectations.

“Our constant currency margin guidance has been tightened against a backdrop of higher than anticipated cost inflation and a planned increase in transformation investments, primarily in R&D and sales and marketing, given our confidence in our strategy.

“We will continue to strengthen our foundations as we pivot to sustainable and profitable growth, and I am confident in the inherent attractiveness of the markets we serve and in ConvaTec’s growth prospects.”