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Invacare: ‘Respiratory products no longer meet minimum profitability target’

Invacare: ‘Respiratory products no longer meet minimum profitability target’

Geoffrey PurtillELYRIA, Ohio – Geoffrey Purtill says the decision to discontinue respiratory products is proof that Invacare is willing to take “decisive action” to turn around the company. 

Invacare announced, as part of its financial results for the third quarter, that it will discontinue respiratory products, including HomeFill and stationary and portable oxygen concentrators, in the fourth quarter. 

“We are committed to taking necessary and decisive action to accelerate the execution of our multi-faceted strategic plan and increase shareholder value,” said Purtill, interim president and CEO, during a conference call. “We’ve made great progress in just a few months’ time, as the actions we’ve already taken are already driving sequential revenue and productivity improvements in the fourth quarter.” 

Invacare will fulfill existing orders for respiratory products with inventory on hand. It will continue to operate its respiratory parts and service business, and honor related warranty and regulatory obligations. 

The company made the decision after “taking a hard look at the business, leaving no stone unturned,” a process that took the better part of a year, Purtill said. 

“As previously guided, sales of respiratory products are anticipated to decline further, given excess supply in the market and lower COVID demand,” he said. “Combined with the higher input costs and inflationary pressures, respiratory products no longer meet our minimum profitability target.” 

Invacare will, instead, double down on its lifestyle and mobility and seating products, which have seen 30% more orders so far this year compared to all of last year, Purtill said. 

“We’re updating our strategic priorities to focus on categories with the highest potential, our core product categories of lifestyle and seating and mobility, which continue to experience strong demand and orders,” he said. “These products serve a growing market with favorable demographics and reduce the complexity of the supply chain overall.” 

Part of Invacare’s plans for seating and mobility include developing a broader product portfolio, Purtill said. 

“The mobility and seating channel is one where reimbursement is pretty key and, in some ways, we’ve struggled to meet those needs adequately with the supply chain challenges we’ve had,” he said. “This is one area where a global portfolio is very helpful. At the moment, we don’t have that and that’s an area we’d look to work toward, so we have a more cost effective and efficient product range that meets the needs of reimbursement but also our end users.” 

Purtill said Invacare will continue to make “tough decisions” in the next two quarters to strengthen the company. In the mix for consideration: product line rationalization, footprint optimization, supply chain simplification, organization rightsizing and liquidity enhancements. 

“By continuing to evolve and capitalize on the company’s strengths and opportunities, we believe we can return to an industry leadership position,” he said.


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