Cochlear FY profit drops 22% but exceeds forecasts

Cochlear Ltd, the Australian hearing implant manufacturer, announced a 22% decline in profit for the year ended June 30, 2023. The underlying net profit fell to A$322.4 million ($213 million), lower than the A$303.9 million forecast by Reuters. Despite a reported revenue decrease of 1% to A$2.34 billion, sales increased by 2% in constant currency terms.

The profit drop was largely due to a A$109.1 million non-cash writedown related to Epiminder, a portfolio company, and A$66 million in cloud-related expenses. The company plans to cut fixed costs to allocate around A$25 million for growth spending next year. Cochlear intends to boost research and development by 15% and strengthen ties with clinical referral networks to boost adult implant demand.

For the fiscal year 2027, the company expects low single-digit revenue growth in constant currency and underlying net profit between A$330 million and A$350 million. The final dividend was reduced by 40% to A$1.30 per share, causing total dividends to fall 20% to A$3.45 per share.