Invacare ends quarter, year with slight growth

ELYRIA, Ohio – Invacare reported net sales increased 1% to $226.2 million in the fourth quarter of 2021 compared to the same period in 2020. 

The company reported net sales increased 2.6% to $875.5 million for full year 2021 vs. full year 2020. 

“We ended the year sustaining strong new order intake and growing customer interest in our leading portfolio of products,” said Matt Monaghan, chairman, president and CEO. “We continue to manage this demand and to take actions to mitigate against higher input costs and longer supply lead times. Our 4Q21 results reflect the benefit of a portion of these actions, demonstrated by sequential improvement in gross margin and Adjusted EBITDA.” 

Invacare reported adjusted EBITDA was $13.1 million in the fourth quarter of 2021 vs. $9.5 million in the fourth quarter of 2020. It was $38.1 million for the full year 2021, an improvement of $6.3 million over full year 2021. 

For North America, Invacare reported net sales decreased 6.9%, with an increase in mobility and seating products more than offset by decreases in lifestyle and respiratory products, primarily driven by the early inefficiencies of an ERP implementation that required additional labor and overtime costs in manufacturing, distribution centers and customer service during the fourth quarter. 

“We went live with another phase of our ERP roll out in October and as expected, had lower output during the initial ramp-up of the new functionality,” Monaghan said. “We have since normalized overall throughput, but the impact was a one-time shift of revenues and free cash flow because of early inefficiencies. Importantly, the system is operating as expected, with more customers using online ordering and customer service functions than with the previous system giving us great confidence that we and our customers will benefit from this strategic investment.” 

Invacare says it will take a number of “strategic actions” to position the company for “durable, long-term success” by the end of 2022, including combining the Europe and APAC businesses under one leader in December, Monaghan said. 

“During the course of the year, we expect further actions to optimize our product portfolio, shift where and how products are made and distributed, align staff and how staff are organized, and implement working capital improvements to enhance free cash flow while strengthening the balance sheet,” he said. “We anticipate these actions will drive sequential quarterly improvements for the final three quarters of the year with the majority of the restructuring benefits occurring in the second half of 2022.”