Sonova Shares Rise Most in Month on Hearing-Aid Sales Growth

Sonova Holding AG (SOON) rose the most in a month in Zurich trading after reporting that sales of hearing aids increased 7 percent in the first half excluding acquisitions.

Sonova rose 13 percent to 86.75 Swiss francs, the stock’s biggest advance since Sept. 14.

The results indicate that Sonova is bouncing back after recalling the HiRes 90K cochlear implants last year because of a malfunction, said Ingeborg Oie, an analyst at Jefferies International Ltd. in London. Sales of the Phonak Ambra hearing aid, which Sonova began selling last year, also are going well, she said in a report to clients today.

The hearing-aid sales growth “should put to rest some of the concerns over the success of the Ambra product,” Oie wrote. “The strong ramp-up in cochlear implant sales following the return of the product to market stands out most.”

Revenue in the six months ended Sept. 30 sank 8.2 percent to 763 million Swiss francs ($851.3 million) because of the Swiss franc’s strength and the recall, the company said in a statement today announcing preliminary results. Analysts predicted 783.7 million francs, the average of three estimates compiled by Bloomberg.

Strong Franc

The franc’s strength against the euro and the dollar cut sales by 17 percent, the company said. Sales of hearing instruments increased 11 percent in local currency terms, boosted by Phonak Spice and Unitron ERA products, Sonova said.

Sonova recalled the implant, made by its Advanced Bionics unit, in November because of a malfunction that led to “severe pain, overly loud sounds and/or shocking sensations.” The company received approval in September from U.S. regulators to resume sales. Sonova said it began selling the product again outside the U.S. in mid-April.

Cochlear Ltd. (COH), the Australian company that makes the world’s best-selling ear implant, said last month it was recalling its Nucleus CI500 range because of an increase in failures. Sonova aims to take market share from Cochlear as a result, Sonova Chief Executive Officer Alexander Zschokke said on a conference call today. Sonova’s own recall hasn’t hurt its reputation, he said.

First-half earnings will be announced Nov. 15. Sonova briefed investors and analysts at a hearing-aid conference today in Germany.

Sonova has fallen 28 percent this year, giving the company a market value of 5.77 billion francs.

To contact the reporter on this story: Phil Serafino in Paris at pserafino@bloomberg.net.

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net.

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