GENEVA—Alcon (SIX/NYSE:ALC) reported worldwide sales of $2.1 billion, an increase of 15 percent on a reported basis and 14 percent on a constant currency basis, for the third quarter ended Sept. 30, 2021 versus the same quarter of the previous year, according to an announcement. "Our third quarter performance demonstrates the strength of Alcon's product pipeline, innovation and commercial execution, resulting in continued growth in all Surgical and Vision Care sales categories," said David Endicott, Alcon's CEO.

"We are developing and delivering differentiated products, platforms and services that enhance eyecare around the world. In Surgical, we are building on our leadership by creating an ecosystem that connects and integrates data systems and equipment in the clinic and operating room. We are also excited to expand our presence in the fast-growing surgical glaucoma market with our intended acquisition of Ivantis. In Vision Care, we are adding new SiHy contact lens designs for daily and reusable wearers, as well as expanding our Systane family with multi-dose preservative-free formulations."
 
Alcon said its Surgical and Vision Care franchises benefited from innovation, commercial execution and improvements in the eyecare market, led by continued strength in the U.S. with varied paces of recovery internationally from the COVID-19 pandemic. Surgical was primarily driven by advanced technology intraocular lenses. The company reported Surgical net sales of $1.2 billion, which include implantables, consumables and equipment/other, increased 17 percent, or 16 percent on a constant currency basis, compared to the third quarter of 2020.
 
The growth of implantables reflected market improvements and the ongoing adoption of advanced technology intraocular lenses, including the launch of Vivity and continued demand for PanOptix. Consumables growth primarily reflected market improvements over the prior year period, and growth in equipment/other was primarily driven by demand for cataract equipment.
 
For the nine months ended Sept.30, 2021, Surgical net sales increased 33 percent, or 30 percent on a constant currency basis, compared to the nine months ended Sept. 30, 2020. Vision Care momentum primarily was driven by Precision1 and Systane Vision Care net sales of $0.9 billion, which include contact lenses and ocular health, increased 12 percent, or 11 percent on a constant currency basis, compared to the third quarter of 2020.
 
Contact lens sales benefited from recovery in select international markets with continued momentum from the launch of Precision1 and Precision1 for Astigmatism. Growth in ocular health was led primarily by strong demand for Alcon’s brand family of Systane products, as well as sales of Simbrinza. For the nine months ended Sept. 30, 2021, Vision Care net sales increased 17 percent, or 15 percent on a constant currency basis, compared to the nine months ended Sept. 30, 2020.

Third quarter 2021 operating income was $20 million, which includes charges of $178 million from the impairment of an intangible asset and $138 million of amortization. Excluding these and other adjustments, third quarter 2021 core operating income was $369 million.

Third quarter core operating margin of 17.7 percent increased versus the prior year, mainly driven by higher sales, partially offset by increases in marketing and selling expenses and research and development. The prior year core operating margin was impacted by unabsorbed manufacturing overhead costs and provisions for expected credit losses related to COVID-19 as well as higher inventory provisions. Foreign exchange had a positive 40 basis point impact on third quarter 2021 core operating margin, Alcon said.

Operating income for the nine months ended Sept. 30, 2021 was $398 million, which includes $391 million of amortization and $223 million of intangible asset impairments. Excluding these and other adjustments, core operating income for the nine months ended Sept. 30, 2021 was $1.1 billion. Core operating margin for the nine months ended Sept. 30, 2021 was 18.0 percent compared to 10.4 percent for the same period last year. Foreign exchange had a positive 50 basis point impact on core operating margin for the nine months ended Sept. 30, 2021.

Alcon ended the third quarter with a cash position of $1.6 billion. Current year cash flows benefited from higher sales, lower separation and transformation payments, partially offset by increased discretionary spending and higher taxes due to timing of payments. Cash flows from operations for the first nine months of 2021 totaled $958 million and free cash flow amounted to $578 million, compared to cash flows from operations of $384 million and free cash flow of $115 million for the same period in the previous year.

The increase in free cash flow was driven by higher cash flows from operations, partially offset by higher capital expenditures. Financial debts totaled $4.1 billion, in line with prior year-end. The company ended the third quarter with a net debt position of $2.5 billion. Alcon continues to have $1 billion available in its existing revolving credit facility as of Nov. 9, 2021.