Convatec Group plc (LON:CTEC) will host a Capital Markets Event this afternoon, 17 November 2022.
Convatec’s Executive Leadership Team, including Chief Executive Officer, Karim Bitar, and Chief Financial Officer, Jonny Mason, will present the next phase of Convatec’s FISBE strategy and the Group’s future growth opportunities.
The team will provide insight into how the Group intends to deliver sustainable organic revenue growth of 4-6% per annum and adjusted operating profit margin expansion into the mid-20s over the medium-term. In delivering these targets, the Group also expects to achieve double-digit EPS and Free Cash Flow CAGR.
The presentations will provide detail into:
– The attractive chronic care markets the Group operates in and Convatec’s leading positions across key geographies
– The next phase of the Group’s FISBE strategy and how the five pillars will evolve to:
· Focus on strengthening customer loyalty in key markets and categories
· Innovate to increase vitality and velocity of trusted medical solutions
· Simplify to improve productivity across our organisation
· Build and embed mission-critical capabilities and winning culture
· Execute with excellence while integrating ESG
– The growth strategies and opportunities for each of the Group’s categories – Advanced Wound Care, Ostomy Care, Infusion Care and Continence Care – and how each will improve the customer experience, enhance its portfolio and drive productivity
– How the Group intends to improve its operating profit margin by:
· strengthening mix across and within categories
· driving simplification and productivity across commercial, Global Quality & Operations and G&A
– The attractive financial qualities of the Group, its cash generative nature, and the Group’s capital allocation framework
On 10 November 2022 the Group published its 10-month trading statement which highlighted continued good momentum in the business. The Group upgraded its 2022 full-year revenue guidance to 5.4-5.8% organic revenue growth, and confirmed it was on track to deliver an adjusted operating profit margin in 2022 of at least 19%.
Consistent with the Group’s medium-term targets, Convatec expects 4-6% organic revenue growth for 2023 to be achievable and for there to be further operating profit margin progression, assuming a modest reduction in the rate of inflation in 2023.
The Group is also pleased to announce that on 15 November it refinanced its bank facilities with $1.2 billion committed for 5 years at slightly improved margins over base rates. The Group’s $500m 2029 senior unsecured notes remain in place. The Group expects Net Debt at year-end to be c.2.1x EBITDA and adjusted finance expense to be c.$55m for 2022. Given the increases in the underlying market base rates, the current expectation is that all in debt costs in 2023 will be c.150bps higher.
The Group will not be disclosing any new material information at today’s event.
Capital Markets Event details
The Capital Markets Event for institutional investors and sell-side analysts will start today at 14:00. Places are limited so if you would like to attend in-person please contact [email protected]
There will also be a live webcast for attendees who wish to join the event virtually, available here.
A copy of the presentation will be available on Convatec’s website after the event with the on-demand webcast available on Friday.
