Surgery equipment firm sees revenue recovery

The Leeds-based firm said direct gross margins (before manufacturing volume variances) have been maintained at around 44 per cent of revenues.

Production recommenced in October to service ongoing customer requirements, and direct costs and overheads are under close control, enabling the company to trade close to the cash break even level.

The firm said the global healthcare market is building some resilience to the ongoing effects of the Covid-19 pandemic, with improved pathways for treating patients with coronavirus enabling elective surgery to resume to some degree in most markets in the second half of 2020.

Elective surgery in the NHS, whilst still reduced compared with pre-Covid-19 levels, has been less impacted by the second wave compared with the first.

The group said the US remains strong despite the well documented Covid-19 situation and it is seeing sales at levels close to those seen last year.

It said that APAC (Asia-Pacific) has performed well in 2020 despite Covid-19 and is on plan for the year, and the company expects this to be another key area in 2021. It added that Europe is still slower to recover than most markets, but it is seeing consistent, albeit lower, levels of ordering by key partners.

Surgical said that whilst the various Covid-19 vaccines are welcome news, it is anticipated that roll out will take some months.

It said that recent developments suggest that it is reasonable to anticipate greater seasonal pressure on beds, and further reductions in elective surgery over the winter.

The company said it is well positioned to conserve resources during this period of subdued demand, and then benefit from an expected recovery, with a return to normalised activity levels towards the end of 2021.

David Marsh, CEO of Surgical Innovations, said: “We are pleased with the work we carried out to mitigate against the challenges of Covid-19 pandemic, taking advantage of the production hiatus to streamline operational and regulatory processes.

"This has been beneficial for the group as we continue to be at the forefront of the sustainability agenda with our Resposable product portfolio.

"Recent progress suggests our product portfolio is well aligned with the needs of healthcare practitioners and providers and so, notwithstanding the ongoing effects of the pandemic, we are optimistic for the medium to long term outlook.”