Miss-Delectable
New Member
- Joined
- Apr 18, 2004
- Messages
- 17,160
- Reaction score
- 7
Cochlear reports 25% jump in profit - Breaking News - Business - Breaking News
The boss calls it a 25-year-old start up, but to tens of thousands of deaf people it is more likely an institution.
Hearing-implant company Cochlear Ltd reported on Tuesday a full year net profit of $100.13 million, a rise of 25 per cent, while core earnings were up 24 per cent to $107.56 million.
Moreover, global sales of Cochlear's implants jumped by 24 per cent on last year, with 15,947 units sold.
After 25 years on the scene, and with continued financial good health, one would think Cochlear had well and truly established itself.
Not so, says chief executive Dr Chris Roberts.
"In the product life cycle, we're still in the early stages," Dr Roberts said.
"If you look at Cochlear implants, the outcomes that people are getting are improving all the time, and the clinical outcomes are improving because the technology improves.
"I view the company as a 25-year-old start up."
Cochlear has forecast core earnings growth of 15 to 20 per cent in 2008, but this is small pickings compared to a strategy at the forefront of Dr Robert's mind - doubling the size of the Sydney-based company.
This involves a complete transformation of Cochlear, already underway, from simply a medical device company to global service company.
"We have been over the last number of years doing a lot of work designing this business for the next doubling - not focused on the next 10 or 15 per cent growth - and it was clear to us that we needed to fundamentally do manufacturing differently and the entire supply chain," Dr Roberts said.
"We've done a lot of work around our internal capacity and capability, but we've been also working on helping the capacity at a clinic level.
"We're offering many more services to help manage troubleshooting issues with people after they get an implant, so it frees up capacity in the clinic.
"We've been changing our business model, moving away from just being a medical device company selling a device to a clinic, to also thinking about consumer advocacy, and indeed a world-class service company looking after the recipients."
Such measures were already affecting Cochlear's revenue, Dr Roberts said, and attributed fiscal 2007's strong performance to the changes.
"The investments that we've been making in our manufacturing and supply chain have really paid off, we've been able to deliver this extra capacity," he said.
"That increase is not from market share. That is the clinics', and the surgeons have been able to treat 25 per cent more patients. That's really encouraging in terms of the capacity in the system."
Dr Roberts estimated that Cochlear was treating only 10 per cent of its potential market each year, highlighting the opportunities available to the company.
"Even after 25 years, we are implanting less than incidents - new patients born deaf or going deaf - so the market is bigger each year," he said.
"The opportunity for us is to organise ourselves to go out and capture more of that opportunity."
All geographic regions had contributed to the company's performance, Cochlear said.
The Americas produced a 26 per cent rise in revenue to $249.8 million and Europe posted a revenue jump of 23 per cent to $213 million.
Revenue from the Asia-Pacific region rose by 34 per cent to $80.1 million, underpinned by strong growth in China, India, Korea and Australia, the company said.
Total revenue was $559.4 million, up 24 per cent on 2006.
Cochlear reported a final dividend of 70 cents a share, taking the full-year dividend to $1.25.
Shares in Cochlear finished $1.44 up, or 2.3 per cent higher, at $63.25 on Tuesday.
The boss calls it a 25-year-old start up, but to tens of thousands of deaf people it is more likely an institution.
Hearing-implant company Cochlear Ltd reported on Tuesday a full year net profit of $100.13 million, a rise of 25 per cent, while core earnings were up 24 per cent to $107.56 million.
Moreover, global sales of Cochlear's implants jumped by 24 per cent on last year, with 15,947 units sold.
After 25 years on the scene, and with continued financial good health, one would think Cochlear had well and truly established itself.
Not so, says chief executive Dr Chris Roberts.
"In the product life cycle, we're still in the early stages," Dr Roberts said.
"If you look at Cochlear implants, the outcomes that people are getting are improving all the time, and the clinical outcomes are improving because the technology improves.
"I view the company as a 25-year-old start up."
Cochlear has forecast core earnings growth of 15 to 20 per cent in 2008, but this is small pickings compared to a strategy at the forefront of Dr Robert's mind - doubling the size of the Sydney-based company.
This involves a complete transformation of Cochlear, already underway, from simply a medical device company to global service company.
"We have been over the last number of years doing a lot of work designing this business for the next doubling - not focused on the next 10 or 15 per cent growth - and it was clear to us that we needed to fundamentally do manufacturing differently and the entire supply chain," Dr Roberts said.
"We've done a lot of work around our internal capacity and capability, but we've been also working on helping the capacity at a clinic level.
"We're offering many more services to help manage troubleshooting issues with people after they get an implant, so it frees up capacity in the clinic.
"We've been changing our business model, moving away from just being a medical device company selling a device to a clinic, to also thinking about consumer advocacy, and indeed a world-class service company looking after the recipients."
Such measures were already affecting Cochlear's revenue, Dr Roberts said, and attributed fiscal 2007's strong performance to the changes.
"The investments that we've been making in our manufacturing and supply chain have really paid off, we've been able to deliver this extra capacity," he said.
"That increase is not from market share. That is the clinics', and the surgeons have been able to treat 25 per cent more patients. That's really encouraging in terms of the capacity in the system."
Dr Roberts estimated that Cochlear was treating only 10 per cent of its potential market each year, highlighting the opportunities available to the company.
"Even after 25 years, we are implanting less than incidents - new patients born deaf or going deaf - so the market is bigger each year," he said.
"The opportunity for us is to organise ourselves to go out and capture more of that opportunity."
All geographic regions had contributed to the company's performance, Cochlear said.
The Americas produced a 26 per cent rise in revenue to $249.8 million and Europe posted a revenue jump of 23 per cent to $213 million.
Revenue from the Asia-Pacific region rose by 34 per cent to $80.1 million, underpinned by strong growth in China, India, Korea and Australia, the company said.
Total revenue was $559.4 million, up 24 per cent on 2006.
Cochlear reported a final dividend of 70 cents a share, taking the full-year dividend to $1.25.
Shares in Cochlear finished $1.44 up, or 2.3 per cent higher, at $63.25 on Tuesday.
