The Cochlear Limited (ASX: COH) share price is rising after the hearing implants company posted its FY23 full-year results.
The Cochlear share price opened at $244.73, up 4.93% on yesterday's close. It's currently trading at $251.30, 7.76% higher.
Cochlear reported record annual revenue of $1,956 million and strong growth across all business units.
And there's a juicy reward for investors with the final dividend boosted by 21% to $1.75 per share.
Let's review the details.
Cochlear share price leaps on record revenue
Here are the highlights of the full-year report:
- Sales revenue $1,956 million, up 19% on the prior corresponding period (pcp) of FY22
- Statutory net profit $301 million, up 4% pcp
- Underlying net profit $305 million, up 10% and at the top end of the guidance range
- 70% franked final dividend of $1.75 per share, up 21% pcp and payable 11 October.
What else happened in FY23?
Cochlear said the launch of the Nucleus 8 Sound Processor late in the second quarter generated strong demand for implants and sound processor upgrades.
The company said an "improving trend in adult referral rates is providing us with early indications that awareness and access initiatives are having some success".
In FY23, Cochlear purchased $30 million in shares as part of a progressive $75 million on-market share buyback to reduce its cash balance to about $200 million over the coming years.
ASX investors were supportive of the share buyback plan announced in February alongside the company's half-year results. The Cochlear share price rose by 7.75% on the day the results were released.
What did Cochlear management say?
Cochlear management says:
As we look to the future, we remain confident of the opportunity to grow our markets.
There remains a significant, unmet and addressable clinical need for cochlear and acoustic implants that is expected to continue to underpin the long-term sustainable growth of the business.
In a separate presentation lodged today, Cochlear says:
We helped over 44,000 people hear with one – or two – of our cochlear or acoustic implants [in FY23], providing an estimated net societal benefit of more than $7 billion over the lifetime of the recipients from improved health outcomes, educational cost savings and productivity gains (up 15%).
What's next for Cochlear?
In terms of FY24 guidance, Cochlear says it expects to deliver underlying net profit of $355 million to $375 million, which would be a 16% to 23% increase on FY23.
Guidance is based on currency assumptions of a 67 cent AUD/USD (67.5 cent average in FY23) and a 61 cent AUD/EUR (64.4 cent average in FY23).
The guidance does not factor in the proposed acquisition of Oticon Medical's cochlear implants business. This is due for completion at the end of December 2023.
Cochlear intends to invest about 12% of its sales revenue in research and development in FY24.
Cochlear share price snapshot
The Cochlear share price is up 10% over the past 12 months and up 20% in the year to date.
