Sonova Holding AG, the world's leading provider of hearing systems, is announcing today that the Group is expecting sales of around CHF 1,600 million and an EBITA margin of 20-21% for 2010/11, barring any unforeseen events. The previously announced recall of the Advanced Bionics cochlear implant, delayed sales growth in traditional hearing instruments and negative currency effects have resulted in changes in the outlook for the current business year.
In the field of hearing implants, the Group confirmed a drop in sales of around CHF 65 million for the current business year due to the product recall by Advanced Bionics that took place in November 2010. Efforts to re-enter the market are progressing well. Activities in the field of research and development have also been further intensified.
Due to an unclear regulatory situation in the US market, the launch of the new Phonak hearing instruments in the second half of the current business year was delayed. It has not been possible to compensate the lost sales, especially as the severe winter has made it difficult to achieve above-average growth. After strong growth in recent years, Unitron, Sonova's second strongest hearing-systems brand, will fall short of its expected sales targets in the current business year. All in all, the Sonova Group is expecting sales of hearing systems in the current business year to be around CHF 40-50 million less than originally anticipated.
Regardless of this, the Group has confirmed that its products have been met with a positive response from customers and that demand for the recently launched Phonak brand products based on the new Spice technology is good. Unitron will present a product range based on the new platform at the AAA Congress in Chicago in April 2011.
Sonova is anticipating an EBITA margin of 20-21% for the 2010/11 business year. This is due primarily to the sales loss from the Advanced Bionics recall, lower sales growth in hearing systems and stronger negative currency effects.
As a result of the product recall by Advanced Bionics, the related goodwill has to be reassessed. Based on the information currently available, Sonova expects an impairment of CHF 150-200 million. This impairment will be recorded as a restatement for business year 2009/10. The result for the current business year 2010/11 is not affected by this restatement.
Sonova expects the growth drivers in the hearing systems market to remain unchanged. The Group is continuing to aim to achieve long-term growth and increased profitability by being an innovation leader, expanding its sales channels and new business areas.
Sonova will publish its results for the 2010/11 business year on May 24, 2011.
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