Sonic Healthcare shares slide after profit warning
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The news: Shares in Sonic Healthcare have plunged after the pathology services provider flagged lower earnings for the current fiscal year.
The numbers: Sonic now expects full-year earnings to be $1.6 billion, down from its previous estimate of between $1.7 billion and $1.8 billion. This is lower than the FY23 result of $1.7 billion. It said FY25 earnings were likely to be in the range of $1.7 billion to $1.75 billion.
Sonic shares slid more than 11% to $23.65 in early trading after the news.
The context: The company attributed the downgrade to inflation and foreign exchange headwinds. Sonic noted that a number of margin improvement initiatives to be completed in the second half of FY24 had been slower to deliver than expected and would now contribute to earnings growth in FY25.
The lower earnings come despite improved revenue compared to last year and likely to be at $8.9 billion in FY24.
What they said: CEO Colin Goldschmidt said: “The 2024 financial year has been one of transition for Sonic Healthcare, moving away from pandemic conditions into a more normal business environment… These unique business conditions have also made forecasting our earnings unusually difficult this year".
The source: ASX announcement
