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UPDATE 1-Australia's Cochlear H1 profit drops 53 pct, shares plunge
February 11, 2014 / 12:05 AM / in 4 years

UPDATE 1-Australia's Cochlear H1 profit drops 53 pct, shares plunge

* H1 net profit A$36.8 mln vs A$51 mln forecast

* Shares dive up to 11.7 pct, lowest since Nov. 2011

* Delays in U.S. approvals hit earnings (Adds earnings details, company comments, analyst comments)

SYDNEY, Feb 11 (Reuters) - Australia’s Cochlear Ltd reported a 53 percent plunge in first-half profit on Tuesday as the world’s biggest maker of hearing implants made slow progress in getting U.S. regulatory approvals, sending its shares to more than two-year lows.

Cochlear said its net profit after tax for the six months ending in December, excluding patent dispute provision, fell to A$36.8 million ($33 million) from A$77.7 million a year ago.

That was over 30 percent lower than market consensus of around A$51 million.

“This was a difficult half as we entered the period with no regulatory approvals for our new products in our key markets,” Cochlear chief executive Chris Roberts said in a statement.

Net profit attributable to members fell 73 percent to A$21 million ($18.78 million), the company’s lowest half-year number in two years. It projected second-half net profit of A$70 million to A$80 million.

“To us it seems the business is struggling. It’s obviously losing market share now,” said Donald Williams, chief investment officer at Platypus Asset Management. “This is obviously the worst half the company has produced for a very long time.”

The company’s shares dropped as much as 11.7 percent to their lowest since November 2011, and last traded down 9.4 percent at A$53.39 at 0000 GMT. The stock has lost 24.4 percent over the past year, against a 5.4 percent gain in the broader market.

Cochlear said the company did get some approvals by the end of the half, which means sales momentum was picking up into the second half.

The company continued to see market pressures in the United States where it had yet to receive certain approvals that it had been expecting.

“If they get their approvals then you would expect sales to improve on the back of that, but the timing of that is uncertain,” said Williams.

($1 = 1.1183 Australian dollars)

Reporting by Maggie Lu Yueyang; Editing by John Mair and Stephen Coates

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