Össur, Reykjavik, Iceland, posted its interim results for the second quarter (2Q) and first half of 2022.
Highlights include:
- Sales amounted to $181 million. Sales growth was 2 percent in local currency and declined by 1 percent organic. In the first half of this year, sales totaled $351 million, sales growth was 5 percent in local currency and increased by 2 percent organic.
- Prosthetics declined by 1 percent in 2Q and grew by 2 percent in first half of this year.
- Sales growth was negatively impacted by $12 million due to currency movements in 2Q 2022, compared to the same period a year ago, which corresponds to about a 6 percent-point negative effect on the reported growth rate.
- Gross profit margin was 61 percent in 2Q, compared to 63 percent in 2Q 2021. Supply chain cost increases are expected to increase cost of goods sold by $15 million on a full-year basis in fiscal year (FY) 2022 from pre-pandemic levels in FY 2019, compared to an increase of $10 million in FY 2021. Gross profit was 61 percent the first half of 2022 compared to 64 percent in the first half of 2021. Össur implemented sales price increases in first quarter 2022 and will seek to increase prices further in 2022 and 2023.
- Earnings before interest, depreciation, and amortization (ETBIDA) amounted to $33 million in 2Q, and the EBITDA margin was 18 percent compared to 22 percent in 2Q 2021.
- Net profit totaled $14 million or 8 percent of sales compared to $19 million or 10 percent of sales in the same period a year ago. Net profit in the first half of 2022 totaled $24 million compared to $31 million the first half of 2021.
- Cash generated by operations amounted to $17 million or 10 percent of sales in 2Q and amounted to $31 million or 9 percent of sales in the first half of the year.
- The financial guidance for the full year has been revised per announcement no. 42/2022 on July 18. The financial guidance for the full year 2022 is 4-6 percent organic sales growth (previous 6-9 percent), 18-20 percent EBITDA margin before special items (previous 20-21 percent), 3-4 percent capital expenditure of sales, and an effective tax rate of 23-24 percent. Currently, Össur management estimates that organic sales growth and EBITDA margin before special items for FY 2022 will be around the middle of the new guidance range.
“The macro environment remains volatile, with external factors affecting sales and supply chain challenges driving higher cost and delays in delivery of products. However, sales growth continues to be strong in [Europe, the Middle East and Africa] and [Asia-Pacific countries] with the exception of China. We are very pleased with how the Power Knee has been received in the market and are optimistic about the potential of powered prosthetics. While managing through this volatile environment that is impacting our operational cost, our focus remains on providing innovative mobility solutions to more individuals,” said Sveinn Sölvason, Össur president and CEO.
