Siemens Healthineers Hikes Outlook on Demand For Covid-Tests

(Bloomberg) -- Siemens Healthineers AG raised its guidance for the year after strong sales of coronavirus testing equipment and a rebound in demand for hospital treatment.

Revenue growth this year may be between 14% to 17%, the company said Monday in a statement. That compares with a previous projection for an 8% to 12% increase. Siemens Healthineers more than doubled its expectations for sales of rapid coronavirus test kits.

The widespread use of the tests, which allow businesses and services to reopen before vaccination programs are completed, has given Siemens Healthineers a boost amid delays in elective treatment due to the pandemic. Demand for core hospital equipment products is expected rise as health treatments returns to more normal levels, the company said.

The results were “were positive” and the new guidance “well ahead” of market estimates, Bernstein analysts led by Lisa Bedell Clive said in a note.

The raised outlook is a boost for Siemens Healthineers’ management after it acquired Varian Medical Systems to gain access to devices and software used in cancer treatment. Recent developments in radiation therapy, coupled with more precise imaging, have been linked to lower death rates, a trend on which the German maker of MRI machines and laboratory equipment is keen to capitalize.

Siemens Healthineers rose as much as 2.4%, taking gains this year to 15%.

Revenue in the U.S. is expected in the coming quarters, Chief Financial Officer Jochen Schmitz said in an interview with Bloomberg TV, adding that European and Asian markets had already recovered.

The company also lifted its adjusted earnings per share outlook to between 1.90 euros ($2.28) and 2.05 euros, compared with 1.63 euros to 1.82 euros.

©2021 Bloomberg L.P.