ConvaTec (2CV) Q2 2026 Earnings Report

The call conveyed an upbeat, constructive tone: management confirmed they are on track for FY '26 targets (revenue growth, at least 23% operating margin, and continued double‑digit EPS growth), announced a USD 200m buyback and highlighted robust Infusion Care momentum, multiple product launches with strong clinical evidence (notably ConvaNiox) and clear CapEx to support long-term growth. Key challenges include the disappointing InnovaMatrix performance and impairment, softer wound care trading in parts of H1, H1 cash timing pressures, currency headwinds and a multi-year FDA remediation program. On balance, the positive execution on strategy, operational productivity, financing actions and high-confidence Infusion Care order visibility outweigh the near-term setbacks.

Convatec reiterated FY‑26 and medium‑term guidance: organic revenue growth for H2 narrowed to 6–8% (with group mid‑term growth target 6–8% p.a. from 2027), Infusion Care expected to be double‑digit in H2 (high‑single‑digit for FY‑26), and operating margin at least 23% for FY‑26 (inclusive of ~80bps InnovaMatrix and ~40bps FX headwinds) with H2 around mid‑20s (~25%) and mid‑20s thereafter; management is “on track” for double‑digit EPS growth (H1 EPS +6%) and targets double‑digit EPS annually from 2027, ~100% free‑cash‑flow‑to‑equity conversion for the year, a $200m share buyback to complete by year‑end, year‑end leverage ~2x EBITDA (H1 2.3x), continued growth CapEx (c.$90m increase focused on Infusion Care) plus operational CapEx ~2.5% of revenue, and InnovaMatrix now expected $5–10m for FY‑26 (H1 sales $2.5m, -$37m y/y) with a $69m non‑cash impairment.