CooperVision had to face strong competition in the U.S. in October from Johnson & Johnson, which accompanied the release of a new one-day silicon hydrogel contact lens, Oasis, with aggressive discounts that flooded the market. Still, CVI managed to raise its total sales of silicon hydrogel lenses by 16 percent to $212 million in the fourth quarter of its financial year, ended last Oct. 30. Dales of its two one-day products, My Day and Clariti, grew by 48 percent.

CVI also suffered some disruption in deliveries in Europe between mid-September and the end of November as it accelerated the shutdown of various regional Sauflon warehouses, transitioning the logistics to its big European distribution center in Belgium. Last but not least, the lens solution business inherited from Sauflon, which was particularly strong in Europe, declined by 36 percent in constant currencies in the last three months, due in part to a fast-growing market for one-day disposable contact lenses.

Each of these three factors had a more or less equal impact on CVI’s revenues during the fourth quarter, resulting in about $20 million worth of lost sales and compounding the effect of a stronger dollar. All in all, CVI’s sales declined by 3 percent to $373.4 million in the quarter, although they were up by 5 percent in local currencies and by 7 percent excluding solutions.

In constant currencies, CVI’s sales grew by 3 percent in Europe, the Middle East and Africa (EMEA), by 4 percent in the Americas and by 13 percent in the rest of the world. In terms of products, single-use spheres enjoyed currency-neutral growth of 12 percent, while toric and multifocal lenses went up by 8 and 7 percent, respectively. Sales of one-day silicon hydrogel lenses jumped by 45 percent on a comparable, pro-forma basis, reaching $137 million for the year.

CVI’s gross margin declined to 54 percent form 59 percent in the year-ago period, in spite of a favorable currency effect on its production costs. The drop was mainly due to integration costs and charges associated with the start-up of new lines, without which the gross margin would have risen from 63 to 64 percent.

For the full financial year through October, CVI’s revenues increased by 7 percent to $1,487.8 million, and they were up by 6 percent on a pro-forma basis, assuming that it had owned Sauflon for two years. The company continued to grow faster than the market, but less so than before.

For the 12 months through September, CVI’s sales went up by 8 percent, twice as fast as the 4 percent increase to $7,265 million calculated by the Contact Lens Institute for the overall global contact lens market. The market grew by 5 percent in the Americas, by 4 percent in EMEA and by 2 percent in Asia-Pacific.

The company’s growth of 9 percent for the July-September period was only marginally higher than the market’s growth of 8 percent, and it clearly underperformed in the Americas, where the market grew by 11 percent. CVI performed better in EMEA and Asia-Pacific, where the market rose by 4 percent and 6 percent, respectively.

Adding the results of Cooper Surgical, the entire Cooper Companies group booked a net profit of $36.7 million for the quarter, up from $30.8 million in the year-ago period, on 3 percent lower sales of $455.5 million. The group’s gross margin declined to 56 percent from 60 percent, but the operating margin progressed from 8 to 9 percent.

For the full financial year, Cooper reported net profit of $203.5 million, down from $269.8 million in the previous year. Sales increased by 5 percent to $1,797.1 million, but the gross margin dropped from 64 to 60 percent and the operating margin fell from 18 to 13 percent. As planned, the company was still be able to deliver more than $200 million in cash flow, excluding acquisition and integration and expenses, and it hopes to raise that to $300 million this year.

The management is predicting a total turnover of between $1,834 million and $1,874 million for the group in 2015/16, including revenues for CVI of $1,509 million to $1,539 million. That implies a sales increase of about 6 percent at CVI, or one percentage point more than the overall soft contact lens market.

Going forward, CVI expects the market to rise by between 4 and 6 percent annually next year and over the next five years, with a possibility to get closer to 6 percent if prices go up. They have been relatively flat overall lately. CVI hopes to continue to grow faster than the market and to hit an operating margin of 27 percent or more by 2020.

One bright spot on the horizon for the company is the recent approval by regulatory authorities for My Day to be sold in the large Japanese market, where total sales of daily contact lenses are estimated at $750 million per year. CVI’s management declined to say when this will happen for competitive reasons, and partly also because of possible capacity constraints.

The integration of Sauflon has been largely completed, but the company will continue to suffer from currency headwinds. Thus, the management is budgeting an increase of between 10 and 14 percent in earnings per share for the current financial year.