ConvaTec Share News (CTEC)

(Sharecast News) - Medical products and technologies company ConvaTec Group updated the market on its trading for the third quarter on Wednesday, reporting that it was in line with management expectations, with full-year guidance remaining unchanged.
The FTSE 250 company said group revenue for the three months ended 30 September was $462.9m, which was 2.4% higher on a reported basis and 4.6% higher on an organic basis year-on-year, which the board said in part reflected the benefits of some short-term tailwinds.

For the nine months ended 30 September, revenue was $1.35bn, which was a decline of 1.6% on a reported basis due to foreign exchange movements, but growth of 1.5% on an organic basis.

Looking at its franchises for the third quarter, in Advanced Wound Care, ConvaTec reported organic growth of 3.6%, which was reportedly driven by its silver portfolio, in particular 'AQUACEL Ag+', as well as foam, while distributor inventory movements provided a short-term tailwind which would partly reverse in the fourth quarter.

In Ostomy Care, the company said organic growth of 3.0% reflected a "solid underlying performance" against a weak 2018 performance.

For Continence and Critical Care organic growth was 8.0%, which the board said was "flattered" - as expected - by a weaker prior year comparator due to a packaging recall, along with continued growth in its Home Distribution Group (HDG).

In Infusion Devices, organic growth was 4.3%, which was also put down to a weaker prior year comparator.

The ConvaTec board said its transformation initiative remained on track, and left its guidance for the 2019 financial year unchanged.

"I am excited to have joined ConvaTec and returned to the healthcare sector," said chief executive officer Karim Bitar.

"Since I joined the group at the end of September I have had the opportunity to visit several sites and engage with many colleagues; I have been encouraged by their enthusiasm and the potential within ConvaTec."

Bitar said he was "pleased" the company reported a solid performance in the third quarter, but added it was a "small step" on a "significant journey" as it focussed on pivoting to sustainable and profitable growth.

"As an organisation we need to get closer to patients, to strengthen our innovation pipeline and to drive a relentless focus on execution excellence.

"I look forward to giving an update on our plans and progress next year."

As at 0952 GMT, shares in ConvaTec were up 9.01% at 199.55p.