Healthcare
Thesis playing out - volume-based procurement has crushed two of AK’s largest segments and AK now expects Spinal and Trauma products to suffer the same fate during 2022. The company has reorganised its segment reporting as it tries to obscure the declines in its key applications. Longer payment terms continue to benefit sales as growth in aged accounts accelerated in 2H21. AK also increased its inventory by double digits y/y even as sales collapsed. The dividend payout has been reduced by 37.5%. The shares are down 46% since Gradient's initiation but further downside is anticipated.
Edition: 135
- 13 May, 2022