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Invacare sees ‘strong growth’ for North America

Invacare sees ‘strong growth’ for North America

Matt MonaghanELYRIA, Ohio – Invacare reported net sales increased 15.1% to $225.9 million in the second quarter of 2021 compared to the same period in 2020.

Net sales for the North America business unit increased 11.2% to $96.2 million year over year, with strong growth in mobility and seating, and respiratory products.

“We achieved high single-digit constant currency net sales growth, with increases in all product categories,” said Matt Monaghan, chairman, president and CEO. “Importantly, mobility and seating products rebounded strongly with constant currency net sales growth of 17.9% in Europe and 12.6% in North America.”

Invacare reported a net loss of $10.7 million in the second quarter of 2021 vs. a net loss of $16.6 million in the same period in 2020.

The company says it is seeing “steady improvement” in access to its customers and end users, as health restrictions ease.

“As a result, and similar to 1Q21, we experienced high demand and strong order intake, and coupled with continuing parts shortages results in excess order backlog at the end of 2Q21 of $15 million, consistent with consolidated levels at the end of 1Q21,” Monaghan said. “The excess order backlog, primarily in Europe, is expected to be fulfilled through the remainder of the year as our service levels are expected to normalize.”

Invacare says it saw good improvement in gross margin from favorable sales mix and the benefit of prior actions to optimize the business, but that was more than offset by supply chain related disruptions, as factories endured more changeover and shifting production plans to deal with intermittent parts shortages and shipment delays, which accounted for 80% of the margin decline.

“Higher material, freight and logistics costs, offset by favorable sales mix, accounted for the other 20%,” Monaghan said. “We view these disruptions as temporary and are taking actions to rectify them. As we implement these actions, we expect gross margin to rebound through the remainder of the year.”

Invacare reaffirmed full year guidance of constant currency net sales growth in the range of 4% to 7%; adjusted EBITDA improvement of 41% to $45 million; and free cash flow of $5 million. 

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