ConvaTec Group PLC (LON:CTEC) shares were higher on Thursday as the firm retained its 2020 outlook and its dividend plans, but also warned that risks to its forecast had increased due to the coronavirus pandemic.
In a trading update for its first quarter, the medical equipment maker reported revenues of US$460mln for the period, up 6.9% year-on-year, as customers stockpiled their inventories to shore up their supply chains.
READ: ConvaTec sacrifices profits for turnaround plan
Looking ahead, the company said it will continue to propose the payment of its final dividend for 2019, which it said reflected its “confidence in the future performance of the group and its underlying financial strength and cash generation”.
ConvaTec also retained its 2020 outlook, however, it said revenues for its advanced wound care business were “expected to be negatively affected” by reduced elective surgeries during the pandemic and that it is also monitoring external risks to its supply chain.
“We had a solid Q1 with the group delivering well against robust demand and we are continuing to drive forward with our transformation as we Pivot to Sustainable and Profitable Growth”, said ConvaTec chief executive Karim Bitar.
“We are maintaining our 2020 guidance; however, it is clear that risks across the business have increased and the operating environment contains a greater level of uncertainty and volatility in the months ahead. Nevertheless, and whilst we still have much to do, the Group is performing, both operationally and financially, and we will continue to focus on executing against our clear strategy and priorities", he added.
The shares rose 3.3% to 208.4p in early deals.