Convatec Group Plc shares jumped nearly 8% after the medical devices maker raised its FY25 organic revenue growth target to 6-8% from 5-7%, overshadowing a $72 million impairment on its InnovaMatrix wound care asset following Medicare reimbursement cuts.

The writedown stems from a 2022 acquisition where Medicare slashed skin substitute payments to $127.28 per square centimetre from January 2026, triggering the charge. InnovaMatrix revenue is projected to plummet roughly 71% to $20 million in 2026 from $69 million in 2025, a significant headwind. Despite this, the company's adjusted EPS rose 16% to 17.6 cents, driven by excluding the impairment and acquisition-related costs.

Convatec's CEO emphasized resilience, noting organic revenue grew 6.5% to $2.439 billion in FY25, with Infusion Care leading at 12.5% growth. The company also extended its long-term supply contract with AbbVie and raised its full-year dividend by 13% to 7.244 cents per share. For 2026, Convatec targets 5-7% organic revenue growth excluding InnovaMatrix, backed by its innovation pipeline.