STOCKHOLM (Reuters) -Swedish medical equipment maker Getinge reported on Thursday a smaller than expected rise in fourth-quarter earnings as costs squeezed margins and its organic order intake fell, sending its shares down.
Operating profit was 1.14 billion crowns ($109 million) against a year-ago 828 million and a mean forecast of 1.36 billion in an LSEG poll of analysts, on organic sales growth of 10%.
The maker of products for surgery, intensive care and sterilisation said profit margins were squeezed by costs for quality improvement work in its acute care therapies unit that has been ongoing for nearly a year.
Higher costs for goods and staff also hit profitability.
Net order intake was up 4%. Excluding acquisitions and currency translations, it however shrank by 2%. Getinge said this was mainly due to a tough year-ago comparison in connection with China lifting pandemic restrictions.
Shares in the group were down 9% in mid-morning trade.
"Despite a weaker order intake, the existing order book, and the dialogue we have with customers lead us to expect organic sales growth of 2-5% for 2024," CEO Mattias Perjos said.
"Two acquisitions completed in Q4 2023 are expected to contribute with 3-5% sales growth in 2024," he added.
In the full year 2023, organic sales growth was 6%.
Getinge unexpectedly proposed a raised dividend for 2023, of 4.40 crowns per share against 4.25 crowns for 2022 and an expected 4.10 crowns.
The company had warned in October that quality and supply challenges for its cardiac assist and cardiopulmonary product categories within Acute Care Therapies would hurt its earnings throughout 2023.
($1 = 10.4155 Swedish crowns)