The Sonic Healthcare Limited (ASX: SHL) share price is on the move on Thursday.
At the time of writing, the healthcare company's shares are up 5% to $40.50.
Why is the Sonic share price rising today?
Investors have been bidding the Sonic share price higher today following the release of a trading update.
According to the release, Sonic's revenue and profits have continued to grow during the first 4 months of FY 2022.
Sonic's revenue is up 5% over the prior corresponding period to $3,087 million. Earnings before interest, tax, depreciation, and amortisation (EBITDA) are up 16% to $991 million.
Given that many brokers are forecasting declines in revenue and earnings this year, it isn't overly surprising to see the Sonic share price rising today on the news.
What is driving Sonic's growth?
Management advised that its growth has been driven by strong demand for COVID-19 testing and a solid performance from its base business.
In respect to Covid testing, the release notes that Sonic's laboratories are testing tens of thousands of people every day. They are also conducting Covid serology testing and, in some markets, Covid whole-genome sequencing to aid identification of variants.
This has seen the company perform a total of about 36 million Covid PCR tests to date during the pandemic.
In addition, Sonic has provided more than 1 million Covid vaccinations to the community. It has distributed them through special-purpose high volume hubs and its network of more than 200 medical centres.
As for the base business, it has grown its revenues by 6% versus the equivalent period in FY 2021. It has also grown 4% versus the equivalent pre-pandemic period in FY 2020.
Management commentary
Sonic's CEO, Dr Colin Goldschmidt, said:
Sonic's 38,000 staff around the world continue to display courage, dedication, initiative and flexibility in meeting the challenges that arise every day in combating the COVID-19 pandemic whilst assisting with the underlying health and well-being of millions of patients.
In addition to the heroic efforts of our staff, our response to the pandemic has been enabled by the decades of investment the company has made in infrastructure, equipment and systems. Without this strong base our current outstanding operational and financial performance would not be possible.
No guidance for FY 2022 has been given due to Covid-related uncertainty.
