Cochlear's profit dented by US tax charges but Apple's implant project is steaming ahead
Written on the 13 February 2018 by David Simmons
Whilst shareholders will receive a higher interim dividend following the half year, Cochlear's (ASX: COH) first-half profit has taken a dip.
The hearing implant developer has maintained its full-year guidance despite its profits taking a dive because of the timing of a large Chinese tender and US tax charges.
Chcolear's net profit for the six months to December 31 fell one per cent from a year earlier to $110.8 million, partly due to a $5.5 million hit from a revaluation of deferred tax assets.
The company says the full-year impact of tax charges in the US will be reduced by a lower corporate tax rate.
Chief executive of Cochlear Dig Howitt says the company's position in the market is strong, mainly because of the launch of its iPhone compatible implant.
"Cochlear's market leadership position has strengthened with new products broadening the portfolio and driving share gains," says Howitt.
The company's market share grew with the launch of the Nucleus 7 sound processor in the US, Western Europe, and Australia.
The Nucleus 7 is the world's first sound processor that streams sound directly from Apple products, enabling people with hearing loss to make phone calls, FaceTime calls, and listen to music in high quality stereo sound.
In the first half, Cochlear sold 15,972 implant units - down two per cent from the same time last year, because of changes in the timing of some tenders in China.
The company says a highlight of its first-half results was a 12 per cent lift in unit sales in developed markets, which includes the US.
Chochlear's interim dividend should delight shareholders - increasing by eight per cent from last year.
The company maintains its forecast of a full-year profit in the range of $240 million to $250 million, up from $224 million in FY17.
Shares in Cochlear are down 0.46 per cent to $171 per share at 1.27pm AEDT.
Business News Australia
Author: David Simmons