Sonova raises guidance reflecting faster business recovery and expects to return to growth in 2H 2020/21 Montag, 28. September 2020 - 07:00

Media Release

Stäfa (Switzerland), September 28, 2020 – Sonova Holding AG, a leading provider of hearing solutions, today raises its guidance for the first half of FY 2020/21. Following the business update on July 6, 2020 Sonova’s business activities have picked up faster than anticipated, supported by the ongoing recovery of the global hearing care market from the COVID-19 pandemic impacts. Moreover, the Group’s internal growth and productivity initiatives are increasingly bearing fruit. As a result, Sonova now expects sales for the first half of FY 2020/21 to reach around 79% of the prior year level at constant exchange rates and to achieve an adjusted EBITA margin in Swiss francs of approximately 15% for the same period. For the second half of the financial year, the Group expects to return to growth, achieving a revenue increase of 4%-8% and a rise in the adjusted EBITA in the range of 20%-30% compared with the prior year period, both at constant exchange rates.

Arnd Kaldowski, CEO of Sonova, says: “During the past months, our business has performed above expectations, driven by a strong product portfolio, the successful execution on our growth and productivity initiatives and supported by improved market conditions. This was only possible thanks to the dedication of our employees and swift action throughout our company to address the current market challenges. Supported by the successful launch of our new Phonak Paradise platform, we expect to return to positive growth in the second half of our business year. Coupled with the acceleration of our efforts to optimize our organizational structure, this is expected to drive a strong growth in profitability for the remainder of the financial year.”

The market recovery continued to progress faster than anticipated, positively impacting Sonova’s business activities. While the overall hearing instruments market remained modestly below prior year levels in recent weeks, some major markets have returned to growth. The cochlear implants market improved as well, albeit at a considerably slower pace than the hearing instruments market as many hospitals continue to operate at reduced surgical volumes. For the Sonova Group, the APAC region continued to lead the recovery in the second quarter of FY 2020/21 with sales growth at constant exchange rates estimated at around 4%, followed by the regions EMEA and Americas (excl. US) at approximately prior year levels. In the United States, sales were close to 10% lower than the prior year level.

As a result and reflecting the year-to-date performance, Sonova therefore raises its guidance for the first half of the financial year 2020/21, expecting Group sales to reach around 79% (previous guidance: 65-75%) of prior year levels and the adjusted EBITA to decline by approximately 30%, both at constant exchange rates. This implies an adjusted EBITA margin in Swiss francs of around 15% (previous guidance: in the single digits at constant exchange rates).

For the second half of the financial year 2020/21, the Group expects revenue growth of 4%-8% and an increase of the adjusted EBITA in the range of 20%-30% compared with the prior year period, both at constant exchange rates. The outlook assumes a continued gradual market recovery absent any significant re-tightening of lockdown restrictions. While the speed of the recovery so far has been encouraging, the current rise in infection rates in several markets illustrates the continued risk to the expected upward trend.

For FY 2020/21, this implies that sales are expected to reach 92%-94% of prior year levels and an adjusted EBITA at around prior year level, both at constant exchange rates. As a consequence of the strengthening of the Swiss franc and reflecting current exchange rates, Sonova anticipates reported sales growth in Swiss francs to be reduced by around 4 percentage points and the adjusted EBITA growth in Swiss francs to be negatively affected by around 10 percentage points in FY 2020/21.

Investor and analyst conference call

Sonova will host a conference call for investors and analysts, today, September 28, 2020, at 08.30 AM CEST to discuss today’s announcement. Participants are kindly requested to dial in 10-15 minutes prior to the start of the call.

The conference call can be accessed at:

+41 (0) 58 310 50 00 (Europa)

+44 (0) 207 107 06 13 (UK)

+1 (1) 631 570 56 13 (USA)

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Contacts:

Disclaimer

This Media Release contains forward-looking statements, which offer no guarantee with regard to future performance. These statements are made on the basis of management’s views and assumptions regarding future events and business performance at the time the statements are made. They are subject to risks and uncertainties including, but not confined to, future global economic conditions, exchange rates, legal provisions, market conditions, activities by competitors and other factors outside Sonova’s control. Should one or more of these risks or un¬certainties materialize or should underlying assumptions prove incorrect, actual outcomes may vary materially from those forecasted or expected. Each forward-looking statement speaks only as of the date of the particular statement, and Sonova undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law.

About Sonova

Sonova, headquartered in Stäfa, Switzerland, is a leading provider of innovative hearing care solutions. The Group operates through its core business brands Phonak, Unitron, Hansaton, Advanced Bionics and AudioNova. Sonova offers its customers one of the most comprehensive product portfolios in the industry – from hearing instruments to cochlear implants to wireless communication solutions.

Pursuing a unique vertically integrated business strategy, the Group operates through three core businesses – hearing instruments, audiological care and cochlear implants – along the entire value chain of the hearing care market. The Group’s sales and distribution network, the widest in the industry, comprises over 50 own wholesale companies and more than 100 independent distributors. This is complemented by Sonova’s audiological care business, which offers professional audiological services through a network of around 3,500 locations in 19 key markets.

Founded in 1947, the Group has a workforce of over 15,000 dedicated employees and generated sales of CHF 2.92 billion in the financial year 2019/20 as well as a net profit of CHF 490 million. Across all businesses, and by supporting the Hear the World Foundation, Sonova pursues its vision of a world where everyone enjoys the delight of hearing and therefore lives a life without limitations.

For more information please visit www.sonova.com and www.hear-the-world.com.

Sonova shares (ticker symbol: SOON, Security no: 1254978, ISIN: CH0012549785) have been listed on the SIX Swiss Exchange since 1994. The securities of Sonova have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), or under the applicable securities laws of any state of the United States of America, and may not be offered or sold in the United States of America except pursuant to an exemption from the registration requirements under the U.S. Securities Act and in compliance with applicable state securities laws, or outside the United States of America to non-U.S. Persons in reliance on Regulation S under the U.S. Securities Act.