ConvaTec shares plunge on sales warning and chief executive retirement
ConvaTec shares plunged as the company released a double whammy of updates on Monday, warning of a hit to sales and announcing the retirement of its chief executive.
Shares in the medical devices maker were down by almost 30% in early trading.
ConvaTec’s revenue in the fourth quarter is expected to be negatively affected, falling by between 18 and 23 million US dollars (£13.7 million to £17.5 million).
The group said the adjustment was due to a change in inventory policy by the biggest customer of its infusion devices franchise.
Analysts said the customer was US-listed medical devices company Medtronic.
The group now expects full-year revenue growth to be up to 1%, compared with a previous estimate of between 2.5% and 3%.
Margins are also set to suffer, with guidance revised down to between 23% and 24% compared with 24% to 25% in a previous estimate.
The company also announced that chief executive Paul Moraviec is to retire.
He will step down as a director with immediate effect, but remain available to assist with the transition process.
Mr Moraviec said: “We have made significant progress during my time as chief executive officer and I am confident that ConvaTec now has the strong platform, infrastructure and leadership to enable the business to flourish.
“I would like to thank all my colleagues across ConvaTec for their hard work and dedication. They have taken ConvaTec to a leading position in the medtech industry and I look forward to watching the company’s future success.”
Non-executive director Rick Anderson will assume the position of interim chief executive while a search is launched for a successor.