STOCKHOLM (Reuters) – Swedish medical gear group Getinge reported an unexpected slide in quarterly profit on Wednesday as supply disruptions continued and post-pandemic demand for some surgical equipment failed to pick up.
The maker of products for surgery, intensive care and sterilisation predicted it will return to healthy growth in the second half of 2023 after sales fell in 2022.
“Hospitals have not yet recovered to pre-pandemic levels for elective surgery, are generally experiencing lower productivity than before the pandemic, and have low treatment needs related to seasonal influenza,” Chief Executive Mattias Perjos said.
Getinge, which early in the pandemic saw demand soar temporarily for ventilators and ECMO machines – a kind of external artificial lung – forecast full-year organic sales growth of 2-5%.
“For 2023 we are expecting a weaker first half of the year … whereas the second half of the year is expected to be stronger,” Perjos said.
Getinge, however, said China’s easing of pandemic restrictions in December had led to a renewed hike in orders for its ECMO and ventilators in December and January.
Its shares were up 2% at 0858 GMT, outpacing the wider market in Stockholm, which was up 1%.
Fourth-quarter operating profit was 828 million crowns ($79.3 million) against 1.11 billion a year-ago and below a mean forecast in a Refinitiv poll of analysts of 1.32 billion, as organic sales and order intake fell 5% and 7%, respectively.
Getinge said it aimed to raise prices and improve efficiency after lower sales and higher costs squeezed margins in the quarter.
“Short term, it is challenging to get full cost compensation via price increases due to long customer agreements for parts of the business,” it added.
It proposed a dividend of 4.25 crowns per share for 2022, up from a year-earlier 4.00 crowns and beating an estimated 4.07 crowns.
($1 = 10.4355 Swedish crowns)
(Reporting by Anna Ringstrom, editing by Terje Solsvik and Sharon Singleton)
