CooperVision (CVI) continued to grow faster than the global soft contact lens market in the first three months of this year, with sales rising by 9 percent in constant dollars in a market that grew by 3 percent to $1.77 billion, according to the management's estimates and independent market research.
Sales in the Europe, Middle East and Africa (EMEA) region went up by 6 percent for CVI as well as the market. CVI outperformed in the Americas with a sales increase of 9 percent in a flat market environment. The company's sales in the Asia-Pacific region went up by 14 percent, against market growth of 5 percent.
For the second quarter of its financial year, ended on April 30, CVI's parent, Cooper Companies, has reported growth of 11 percent in its total revenues to $483.8 million, with an increase of 9 percent on a pro forma basis. Its net income rose to $74.4 million from $61.1 million.
CVI's revenues rose by 9 percent in dollars as well as in local currencies in the quarter, reaching $391.2 million. It was the strongest quarterly increase for CVI since 2014, and the management attributed it to the strength of its product portfolio. The growth was led by increases of 14 percent for both toric and multifocal lenses.
A similar increase was recorded for two-week and monthly silicon hydrogel lenses. Single-use silicon hydrogel lenses, including Sauflon's Clariti line, grew by 52 percent. Total sales of silicon hydrogel lenses rose by 20 percent, and this category now represents 60 percent of CVI's sales.
Sales in Japan, where the total contact lens market is estimated at $1.2 billion a year, were driven by the company's Proclear and Biofinity lines and boosted by the launch of its MyDay contact lenses in March. During the quarter, CVI launched an improved version of its Avaira two-week silicon hydrogel lens in EMEA, called Avaira Vitality, using improved manufacturing processes for higher quality at a lower cost. It should be introduced in the U.S. later this year.
The gross margin remained flat at 61 percent of sales. The margin was lower than expected because CVI was forced to keep some manufacturing equipment in Hungary idle while introducing new equipment. The negative impact will persist in the next two quarters. The operating margin improved to 28.8 percent from 25 percent.
Cooper is targeting revenues of between $1,545 million and $1,567 million for CVI during its full financial year ending in October, indicating growth of 7 percent in constant currencies versus a previous forecast of 5.5 percent.
In its discussion with analysts, the management expressed little concern about a new monthly sphere launched by Johnson & Johnson in June, noting that it's not a whole family of products. It's competing against CVI's Biofinity line of monthly lenses, which is going to be expanded.