Sonova: very strong fundamentals

The company posted better than expected annual results. Although the turnover is down, the group has managed to improve its profitability. Sonora implemented optimization measures in July 2020 which resulted in a workforce reduction of 4.5%. The pandemic has penalized the course of business because restrictions and the fear of being infected have dissuaded clients from seeing doctors and audiologists. However, the fundamentals underlying the group’s growth are still very much present: the ageing population and retirees want to stay active. The group therefore expects a strong sales recovery in 2021. Turnover should increase between 24% and 28% and EBITDA between 34% and 42%. These estimates do not take into account the contribution of wireless headphones from Sennheiser, which Sonova recently acquired. In addition, to underline its confidence in the future, the group increased its dividend to CHF 3.2 per share and launched a share buyback program of CHF 700 million.