5.2.2024 17:45:14 CET | Demant A/S |
Årsrapport
Selskabsmeddelelse nr 2024-03 5. februar 2024
Resultat for 2023 og forventninger til 2024
Stærk omsætningsvækst på 14 % (12 % organisk) i 2023 drevet af exceptionelle resultater i Hearing Aids
EBIT på DKK 4.148 mio. i 2023 og betydelig forbedring af EBIT-margin på 2,2 procentpoint til 18,5 %
Meget stærkt cashflow med CFFO på DKK 4.307 mio. og FCF på DKK 3.476 mio.
Beslutning om at foretage en evaluering af de strategiske muligheder for Communications-forretningen
Forventninger til 2024: Organisk vækst på 4-8 % og EBIT på DKK 4.600-5.000 mio. i Hearing Healthcare
“2023 har været et fremragende år for Demant. Vi opjusterede vores finansielle forventninger to gange i løbet af året, hvilket er et tydeligt tegn på vores produkters relevans for kunderne. Især Hearing Aids leverede meget stærke resultater med 22 % organisk vækst i salget til eksterne kunder, og drevet af vores succesfulde udrulning af Oticon Real fortsatte vores arbejde med at lette livet for mennesker med høretab ved hjælp af vores innovative produkter og fokus på individuel høreomsorg. Vi leverede et meget stærkt cashflow og øgede lønsomheden, samtidig med at vi fortsatte med at styrke vores konkurrencemæssige position i markedet. Inden længe vil vi påbegynde lanceringen nye flagskibshøreapparater, som fremadrettet yderligere vil styrke vores produktudbud til kunder og brugere.
Hvad angår Communications-forretningen, er markedet for enterprise solutions desværre fortsat svagt, og sammen med vores beslutning om at afvikle Gaming-forretningen har dette ført til negative resultater i 2023. Men efter betydelige omkostningsreduktioner i de seneste par år er virksomheden nu på vej mod lønsomhed, så det er et godt tidspunkt at undersøge, om det næste skridt for Communications kan realiseres bedre med en anden ejer. Vi har derfor påbegyndt evalueringen af strategiske muligheder for forretningen med det formål at finde den bedste ejer til at bringe forretningen videre og realisere dens fulde potentiale,” siger Søren Nielsen, koncernchef og adm. direktør i Demant.
Omsætning (DKK mio.)
Vækst
Forretningsområde
Q4 2023
Q4 2022
Organisk
Akkvisitiv
LCY
FX
Rapporteret
Hearing Aids, samlet salg
3.100
2.703
16 %
0 %
16 %
-1 %
15 %
Hearing Aids, internt salg
-482
-395
18 %
6 %
24 %
-2 %
22 %
Hearing Aids, eksternt salg
2.618
2.308
16 %
-1 %
15 %
-1 %
13 %
Hearing Care
2.423
2.173
8 %
6 %
14 %
-3 %
12 %
Diagnostics
659
612
8 %
3 %
11 %
-3 %
8 %
Hearing Healthcare
5.700
5.093
12 %
2 %
14 %
-2 %
12 %
Communications
185
252
-25 %
0 %
-25 %
-2 %
-27 %
Koncern
5.885
5.345
10 %
2 %
12 %
-2 %
10 %
Omsætning (DKK mio.)
Vækst
Forretningsområde
H2 2023
H2 2022
Organisk
Akkvisitiv
LCY
FX
Rapporteret
Hearing Aids, samlet salg
6.024
5.149
18 %
0 %
18 %
-1 %
17 %
Hearing Aids, internt salg
-976
-865
11 %
6 %
16 %
-3 %
13 %
Hearing Aids, eksternt salg
5.048
4.284
20 %
-1 %
19 %
-1 %
18 %
Hearing Care
4.575
4.191
7 %
6 %
13 %
-4 %
9 %
Diagnostics
1.284
1.225
7 %
2 %
10 %
-5 %
5 %
Hearing Healthcare
10.907
9.700
13 %
2 %
15 %
-3 %
12 %
Communications
381
508
-22 %
0 %
-22 %
-3 %
25 %
Koncern
11.288
10.208
11 %
2 %
13 %
-3 %
11 %
Medmindre andet er angivet, omhandler nedenstående tekst H2 2023. Regnskabsmæssigt indregnes Communications-forretningen som en del af koncernens fortsættende aktiviteter i 2023, mens den i 2024 og fremadrettet vil blive indregnet som en ophørende aktivitet. Regnskabstallene i denne meddelelse er ureviderede, og de endelige reviderede regnskabstal vil fremgå af koncernens årsrapport for 2023 den 6. februar 2024.
Koncernen leverede organisk vækst på 11 % (Q4: 10 %), som udelukkende kunne tilskrives Hearing Healthcare. Den akkvisitive vækst lå på 2 % (Q4: 2 %), og valutakurseffekter udgjorde -3 % (Q4: -4 %), og den samlede rapporterede vækst var 11 % (Q4: 10 %). For helåret var den organiske vækst 12 % med vækst fra akkvisitioner på 3 % og valutakurseffekter på -1 %. Den samlede rapporterede vækst for koncernen var således 14 % i 2023.
Hearing Healthcare leverede organisk vækst på 13 % (Q4: 12 %) drevet af særligt høj vækst i Hearing Aids samt yderligere vækst på 2 % (Q4: 2 %) fra akkvisitioner i Hearing Care og Diagnostics.
Hearing Aids fortsatte med at præstere på et meget højt niveau med høj tocifret vækst drevet af succesen med vores højkvalitetsapparater, der blev lanceret i Q1, deriblandt Oticon Real. Væksten bestod primært af stykvækst (11 %), men vi så også en positiv effekt fra ASP-udviklingen (7 %), idet vores succes i premiumprissegmentet havde positive mikseffekter, særligt i Q4. Den organiske vækst i vores samlede salg faldt fra 21 % i Q3 til 16 % i Q4 som følge af stærke sammenligningstal og mindre salg til visse store kunder. I løbet af februar begynder vi udrulningen af nye, industriførende højkvalitetshøreapparater i vores primære brands, deriblandt vores nye flagskibsprodukt, Oticon Intent, som alle vil understøtte væksten i 2024.
Hearing Care oplevede godt momentum med organisk vækst på de fleste mellemstore markeder. Væksten i Frankrig var moderat negativ, mens USA oplevede positiv vækst. Den organiske vækst øgedes sekventielt fra 6 % i Q3 til 8 % i Q4 understøttet af meget lave sammenligningstal i Kina. I H2 var væksten primært drevet af styksalget, men godt hjulpet på vej af den gennemsnitlige salgspris, der var positivt påvirket af et gunstigt produktmiks efter lanceringen af vores premiumprodukter i Q1. I tråd med vores strategiske prioriteter fortsatte vi med at opkøbe klinikker, hvilket bidrog betydeligt til væksten i perioden.
Diagnostics oplevede solid vækst med organisk vækst på 7 % i H2 trods den fortsat negative effekt af et afdæmpet kinesisk marked. Vi oplevede moderat øget vækst fra 6% i Q3 til 8 % i Q4, hjulpet på vej af lavere sammenligningstal. Mindre akkvisitioner understøttede fortsat væksten.
Communications oplevede organisk vækst på -22 % (Q4: -25 %), og markederne for enterprise solutions og gaming-headset forblev udfordrede. Vores Enterprise Solutions-forretning leverede organisk vækst på -21 % (Q4: -18 %), og resultatet ved udgangen af året var ikke som forventet. Efter beslutningen om gradvist at afvikle vores Gaming-aktiviteter (ca. 15 % af omsætningen i Communications i Q4) er hovedparten af vores lagerbeholdning blev solgt til betydeligt reducerede priser, hvilket – sammen med andre mindre engangsomkostninger – påvirkede EBIT negativt med ca. DKK 60 mio. i H2.
Koncernens bruttomargin var 74,2 %, hvilket er en sekventiel stigning på 0,9 procentpoint i forhold til H1 og er på niveau med vores forventninger. Stigningen, som var drevet af Hearing Healthcare, mere end udlignede det betydelige fald i bruttomarginen i Communications som følge af nedlukningen af vores Gaming-forretning. Sammenlignet med H2 2022 faldt bruttomarginen marginalt med 0,1 procentpoint.
OPEX voksede organisk med 3 % med yderligere vækst på 4 % fra akkvisitioner og -3 % fra valutakurseffekter. Det øgede OPEX afspejler investeringer i Hearing Healthcare, hvor vi fortsatte med øge vores R&D-kapacitet og udvide vores distribution både organisk og gennem akkvisitioner, men i Communications faldt OPEX som følge af de tidligere annoncerede omkostningsreducerende tiltag.
I H2 2023 var koncernens EBIT DKK 2.134 mio. svarende til en EBIT-margin på 18,9 %. Stigningen på 3,0 procentpoint sammenlignet med H2 2022 kan tilskrives betydelig driftsmæssig gearing i Hearing Healthcare, som så en stor forbedring i EBIT-marginen i perioden, hvilket mere end udlignede den svage lønsomhed i Communications. For helåret beløb EBIT sig til DKK 4.148 mio., hvilket er en stigning på 29 % i forhold til 2022 og svarer til en EBIT-margin på 18,5 %.
Primært som følge af højere lønsomhed, men også understøttet af en lille forbedring i nettoarbejdskapitalen, leverede koncernen et meget stærkt cashflow i H2 med CFFO på DKK 2.472 mio. og FCF på DKK 1.993 mio. Efter et lavere end forventet omfang af akkvisitioner i H1 steg antallet i H2, hvor vi brugte DKK 622 mio. på akkvisitioner, selvom dette beløb lå under det oprindeligt forudsete beløb.
Efter beslutningen om at genoptage vores aktietilbagekøb i november 2023 købte vi aktier tilbage for DKK 829 mio. i H2, og pr. 31. december 2023 var koncernens gearing-multipel (NIBD/EBITDA) 2,2, hvilket er på niveau med vores mellemlange til langsigtede mål på 2,0-2,5.
Resultat efter skat fra ophørende aktiviteter, som i 2023 bestod af vores Hearing Implants-forretning, var DKK -81 mio. Frasalget af vores cochlear-implantatforretning forventes stadig at blive lukket i H1 2024.
Efter lanceringen af vores mål for kønsdiversitet i 2022 steg andelen af kvinder i topledelsen i 2023 til 27 %, hvilket er en stigning på 4 procentpoint i forhold til begyndelsen af året, hvilket er drevet af fokuserede tiltag inden for lederuddannelse og af inklusionsinitiativer inden for rekruttering.
I H2 udgjorde koncernens Scope 1 og 2 CO2e-emissioner 14,973 ton, hvilket er et fald på 15 % i forhold til 2022 som følge af øget brug af vedvarende elektricitet.
Vi har besluttet at foretage en evaluering af strategiske muligheder for Communications for at undersøge, om en anden ejer kunne være bedre i stand til at accelerere væksten og til at gøre det muligt for forretningen at realisere sit fulde potentiale. Evalueringen forventes afsluttet senest ved udgangen af H1 2024. Regnskabsmæssigt indregnes forretningen som en del af koncernens ophørende aktiviteter i 2024 og fremadrettet.
Forventninger til 2024
Vores forventninger til 2024 for vores fortsættende aktiviteter (Hearing Healthcare) er opsummeret i tabellen nedenfor:
Parameter
Forventninger til 2024
Organisk vækst
4-8 %
EBIT
DKK 4.600-5.000 mio.
Aktietilbagekøb
Mere end DKK 2.000 mio.
Forventningerne er baseret på en række nøgleantagelser som beskrevet nedenfor:
Vi forventer, at stykvækstraten på det globale høreapparatmarked i 2024 vil være på niveau med den strukturelle vækstrate på 4-6 %. Vi forventer en negativ effekt af fald i de gennemsnitlige salgspriser på det normale niveau på 1-2 % som følge af mikseffekter.
Vi forventer, at omfanget af mindre opkøb i 2024 vil være højere end normalt, idet nogle akkvistioner er blevet udsat fra 2023, og som følge af en god pipeline af attraktive opkøbsmuligheder.
Communications vil blive indregnet som en del af ophørende aktiviteter. Vi forventer, at resultatet efter skat for Communications vil være negativt med DKK 100-150 mio. Dette vedrører kun det forventede tab for helåret og inkluderer ikke nogen finansiel påvirkning fra evalueringen af de strategiske muligheder.
Frasalget af vores cochlear-implantatforretning forventes afsluttet i H1 2024. Vores forretning for benforankrede høreløsninger vil forblive en del af koncernen, mens overvejelser om vores strategiske muligheder pågår. For helåret 2024 forventer vi, at resultatet efter skat for Hearing Implants vil være ca. DKK 0 mio.
Yderligere antagelser til finansiel modellering for 2024:
Parameter
Antagelser vedrørende 2024
Akkvisitiv vækst
1 % baseret på omsætning fra akkvisitioner gennemført pr. 4. februar 2024
Valutakursvækst
-1 % baseret på valutakurser pr. 4. februar 2024 og inkl. effekten af valutakurssikring
Effektiv skattesats
Omkring 24 %
Resultat efter skat fra ophørende aktiviteter
Negativt med DKK 100-150 mio., som udelukkende tilskrives Communications, og med resultat efter skat for Hearing Implants på ca. DKK 0 mio.
Telekonference
Demant afholder en telekonference den 6. februar 2024 kl. 14.00 CET. Telekonferencen vil blive vist via webcast på vores hjemmeside www.demant.com. Hvis man ønsker at deltage i telekonferencen for at stille spørgsmål, bedes man forhåndsregistrere sig her for at modtage opkaldsdetaljer og adgangskode. Præsentationen, der vises på telekonferencen, vil blive uploadet på vores hjemmeside, kort før konferencen starter.
Yderligere information:
Søren Nielsen, koncernchef & adm. direktør
Telefon +45 3917 7300
www.demant.com
Øvrige kontaktpersoner:
René Schneider, CFO
Mathias Holten Møller, Head of Investor Relations
Peter Pudselykke, Investor Relations Officer
Henrik Axel Lynge Buchter, Manager of External Communications
Hoved- og nøgletal (1/2)
(DKK mio.)
H2 2023
H2 2022
Ændring
FY 2023
FY 2022
Ændring
Hearing Healthcare
Omsætning
10.907
9.700
12 %
21.601
18.645
16 %
Organisk vækst
13 %
5 %
14 %
5 %
Bruttomargin
76,1 %
75,9 %
75,6 %
76,1 %
EBIT
2.344
1.748
34 %
4.506
3.443
31 %
EBIT-margin
21,5 %
18,0 %
20,9 %
18,5 %
Communications
Omsætning
381
508
-25 %
842
1.060
-21 %
Organisk vækst
-22 %
-13 %
-19 %
-13 %
Bruttomargin
17.8 %
43,9 %
26,6 %
45,0 %
EBIT
-210
-129
n.a.
-358
-236
n.a.
EBIT-margin
-54,9 %
-25,4 %
-42,5 %
-22,3 %
Koncern
Resultatopgørelse
Omsætning
11.288
10.208
11 %
22.443
19.705
14 %
Organisk vækst
11 %
3 %
12 %
4 %
Bruttomargin
74,2 %
74,3 %
73,7 %
74,4 %
EBITDA
2.820
2.255
25 %
5.482
4.383
25 %
EBITDA-margin
25,0 %
22,1 %
24,4 %
22,2 %
EBIT
2.134
1.619
32 %
4.148
3.207
29 %
EBIT-margin
18,9 %
15,9 %
18,5 %
16,3 %
Finansielle poster, netto
-395
-185
114 %
-754
-280
169 %
Resultat efter skat – fortsættende aktiviteter
1.297
1.118
16 %
2.555
2.276
12 %
Resultat efter skat – ophørende aktiviteter
-81
-84
n.a.
-757
-192
n.a.
Periodens resultat
1.216
1.035
17 %
1.798
2.084
-14 %
Balance
Aktiver
30.546
29.857
2 %
30.546
29.857
2 %
Nettorentebærende gæld (NIBD)
12.280
12.711
-3 %
12.280
12.711
-3 %
Egenkapital
9.338
8.562
9 %
9.338
8.562
9 %
Pengestrømsopgørelse
Pengestrømme fra driftsaktiviteter (CFFO)
2.472
1.707
45 %
4.335
2.622
65 %
Investeringer i materielle anlægsaktiver, netto
327
329
-1 %
633
630
0 %
Frie pengestrømme (FCF)
1.993
1.219
63 %
3.483
1.617
115 %
Aktietilbagekøb
829
533
56 %
846
1.840
-54 %
Vi henviser til Note 9.1 i Annual Report 2023 for en beskrivelse af den anvendte regnskabspraksis for rapportering af hoved- og nøgletal.
Hoved- og nøgletal (2/2)
H2 2023
H2 2022
Ændring
FY 2023
FY 2022
Ændring
Øvrige nøgletal
Gearing-multipel (NIBD/EBITDA)
2,2
2,9
2,2
2,9
Indtjening pr. aktie (EPS) – fortsættende aktiviteter, DKK
5,81
4,99
17 %
11,44
10,06
-14 %
Indtjening pr. aktie (EPS), DKK
5,44
4,61
18 %
8,04
9,21
-13 %
Frie pengestrømme pr. aktie (FCFPS), DKK
8,93
5,40
65 %
15,61
7,15
118 %
Aktiekurs, ultimo, DKK
296,00
192,55
54 %
296,00
192,55
54 %
Gennemsnitligt antal aktier i omløb, mio.
223,13
224,06
-0 %
223,13
226,01
-1 %
Gennemsnitligt antal medarbejdere
21.413
20.349
5 %
21.168
19.239
10 %
Scope 1 og 2 CO2e-emissioner (ton)1
14.973
17.644
-15 %
30.469
35.862
-15 %
Kønsdiversitet, bestyrelse (kvinder/mænd)2
40/60 %
40/60 %
40/60 %
40/60 %
Kønsdiversitet, alle ledere (kvinder/mænd)
47/53 %
44/56 %
47/53 %
44/56 %
Kønsdiversitet, topledere (kvinder/mænd)
27/73 %
23/77 %
27/73 %
23/77 %
1 Tallene i 2022 er justeret, idet nye akkvisitioner, som ikke var medtaget i 2022, nu er indregnet.
2 Generalforsamlingsvalgte bestyrelsesmedlemmer.
Årlige vækstrater pr. forretningsområde
Omsætning (DKK mio.)
Vækst
Forretningsområde
FY 2023
FY 2022
Organisk
Akkvisitiv
LCY
FX
Rapporteret
Hearing Aids, samlet salg
12.112
9.991
21 %
0 %
21 %
1 %
21 %
Hearing Aids, internt salg
-2.076
-1.760
14 %
6 %
20 %
-2 %
18 %
Hearing Aids, eksternt salg
10.036
8.231
22 %
-1 %
21 %
1 %
22 %
Hearing Care
9.083
8.123
8 %
7 %
15 %
-3 %
12 %
Diagnostics
2.482
2.291
7 %
4 %
11 %
-3 %
8 %
Hearing Healthcare
21.601
18.645
14 %
3 %
17 %
-1 %
16 %
Communications
842
1.060
-19 %
0 %
-19 %
-2 %
-21 %
Koncern
22.443
19.705
12 %
3 %
15 %
-1 %
14 %
Kontakter
Henrik Axel Lynge Buchter, External Communication Manager, Corporate Communication & Sustainability, +45 2264 9982, heey@demant.com
Om Demant A/S
Demant is a world-leading hearing healthcare group that offers solutions and services to help people with hearing loss connect with the world around them. In every aspect, from hearing devices, hearing implants, diagnostics to audio and video solutions and hearing care all over the world, Demant is active and engaged. Our innovative technologies and know-how help improve people’s health and hear-ing. We create life-changing differences through hearing health.
Vedhæftninger
2024-03 Resultat for 2023 og forventninger til 2024.pdf
5.2.2024 17:45:14 CET | Demant A/S |
Annual Financial Report
Company announcement no 2024-03 5 February 2024
Results for 2023 and outlook for 2024
Strong revenue growth of 14% (12% organic) in 2023 driven by excellent performance in Hearing Aids
EBIT of DKK 4,148 million in 2023 with EBIT margin expanding significantly by 2.2 percentage points to 18.5%
Very strong cash flow with CFFO of DKK 4,307 million and FCF of DKK 3,476 million
Decision to undertake review of strategic options for Communications business
Outlook for 2024: Organic growth of 4-8% and EBIT of DKK 4,600-5,000 million in Hearing Healthcare
“2023 has been an outstanding year for Demant, and we upgraded our financial guidance twice during the year, which clearly illustrates the relevance of our products to customers. Hearing Aids, in particular, delivered a very strong performance with 22% organic growth in sales to external customers, and spearheaded by the succesful roll-out of Oticon Real, we continued our journey to improve the lives of people living with hearing loss through innovative products and dedicated focus on personalised care. We delivered very strong cash flow and increased profitability, while continuing to strengthen our competitive position in the market, and we will soon be launching new flagship hearing aids that will further enhance our offering to customers and users going forward.
As far as our Communications business is concerned, the market for enterprise solutions has unfortunately remained weak, and along with our decision to wind down our Gaming activities, this has led to negative results in 2023. However, following significant cost reductions over the last couple of years, the business is now on a path to profitability, so it is a good time to explore whether the next step of this journey for Communications is better realised under different ownership. We are therefore undertaking a review of strategic options for the business with a view to finding the best owner to take the business forward and realise its full potential,” says Søren Nielsen, President & CEO of Demant.
Revenue (DKK million)
Growth
Business area
Q4 2023
Q4 2022
Organic
Acquisitive
LCY
FX
Reported
Hearing Aids, total sales
3,100
2,703
16%
0%
16%
-1%
15%
Hearing Aids, internal sales
-482
-395
18%
6%
24%
-2%
22%
Hearing Aids, external sales
2,618
2,308
16%
-1%
15%
-1%
13%
Hearing Care
2,423
2,173
8%
6%
14%
-3%
12%
Diagnostics
659
612
8%
3%
11%
-3%
8%
Hearing Healthcare
5,700
5,093
12%
2%
14%
-2%
12%
Communications
185
252
-25%
0%
-25%
-2%
-27%
Group
5,885
5,345
10%
2%
12%
-2%
10%
Revenue (DKK million)
Growth
Business area
H2 2023
H2 2022
Organic
Acquisitive
LCY
FX
Reported
Hearing Aids, total sales
6,024
5,149
18%
0%
18%
-1%
17%
Hearing Aids, internal sales
-976
-865
11%
6%
16%
-3%
13%
Hearing Aids, external sales
5,048
4,284
20%
-1%
19%
-1%
18%
Hearing Care
4,575
4,191
7%
6%
13%
-4%
9%
Diagnostics
1,284
1,225
7%
2%
10%
-5%
5%
Hearing Healthcare
10,907
9,700
13%
2%
15%
-3%
12%
Communications
381
508
-22%
0%
-22%
-3%
25%
Group
11,288
10,208
11%
2%
13%
-3%
11%
Unless otherwise indicated, the commentary below relates to H2 2023. For accounting purposes, the Communications business is recognised as part of the Group’s continuing operations in 2023 but will be recognised as a discontinued operation in 2024 and going forward. Financial figures in this announcement are unaudited, pending the release of the Group’s Annual Report 2023 on 6 February 2024.
The Group generated organic growth of 11% (Q4: 10%) driven entirely by Hearing Healthcare. Growth from acquisitions added 2% (Q4: 2%) and exchange rate effects -3% (Q4: -2%), and total reported growth was 11% (Q4: 10%). For the full year, organic growth was 12%, with growth from acquisitions adding 3% and exchange rate effects -1%. Total reported growth for the Group thus amounted to 14% in 2023.
Hearing Healthcare saw organic growth of 13% (Q4: 12%) driven by particularly strong growth in Hearing Aids, with additional growth of 2% (Q4: 2%) related to acquisitions in Hearing Care and Diagnostics.
Hearing Aids continued to perform very strongly with high double-digit growth, driven by the continued success of our premium hearing aids launched in Q1, including Oticon Real. Growth was primarily driven by units (11%), but we also saw a positive impact from ASP (7%), as our success in the premium price segment drove positive mix effects, particularly in Q4. Organic growth in our total sales decelerated from 21% in Q3 to 16% in Q4 due to strong comparative figures and lower sales to certain large accounts. During February, we will begin the roll-out of new, premium, industry-leading hearing aids in our main brands, including our new flagship product, Oticon Intent, all of which will support growth in 2024.
Hearing Care saw positive momentum with good organic growth in most medium-sized markets. Growth in France was slightly negative, while the US saw positive growth. Organic growth improved sequentially from 6% in Q3 to 8% in Q4, which was supported by very low comparative figures in China. In H2, growth was primarily driven by units, but supported by an ASP that was positively impacted by a favourable product mix following our premium launch in Q1. In line with our strategic priorities, we continued to acquire clinics, which contributed considerably to growth in the period.
Diagnostics saw solid performance with organic growth of 7% in H2 despite the continuously negative impact of weak market dynamics in China. We saw a slightly increasing growth rate from 6% in Q3 to 8% in Q4, helped by lower comparative figures. Growth continued to be supported by minor acquisitions.
Communications saw organic growth of -22% (Q4: -25%), and the markets for enterprise solutions and gaming headsets remained challenging. Our Enterprise Solutions business saw organic growth of -21% (Q4: -18%), and the end to the year was below expectations. Following the decision to wind down our Gaming activities (approx. 15% of revenue in Communications in Q4), most of our inventory has been cleared at significantly reduced prices, which – along with other minor one-off costs – negatively impacted EBIT in H2 by approx. DKK 60 million.
The Group’s gross margin was 74.2%, a sequential improvement of 0.9 percentage point compared to H1, which is in line with our expectations. The improvement was driven by Hearing Healthcare, which more than offset the significant decline in the gross margin in Communications due to the winding down of Gaming. Compared to H2 2022, the gross margin declined marginally by 0.1 percentage point.
OPEX grew organically by 3% with additional growth of 4% from acquisitions and -3% from exchange rate effects. The increased OPEX reflects investments in Hearing Healthcare, where we continued to increase our R&D capacity and expand distribution both organically and through acquisitions, but in Communications, OPEX declined as a result of previously announced cost reduction measures.
In H2 2023, the Group’s EBIT amounted to DKK 2,134 million, corresponding to an EBIT margin of 18.9%. The increase of 3.0 percentage points compared to H2 2022 is attributable to material operating leverage in Hearing Healthcare, which delivered a strong EBIT margin improvement in the period. This more than offset weak profitability in Communications. For the full year, EBIT amounted to DKK 4,148 million, which is an increase of 29% versus 2022 and corresponds to an EBIT margin of 18.5%.
Primarily due to higher profitability and supported by a slight improvement in the net working capital, the Group delivered very strong cash flow in H2, with CFFO of DKK 2,472 million and FCF of DKK 1,993 million. Following a lower-than-expected level of acquisitions in H1, we saw activities picking up in H2 where we spent DKK 622 million on acquisitions, although this amount remained below our original plans.
Following our decision to resume share buy-backs in November 2023, we bought back shares worth DKK 829 million in H2, and the Group’s gearing multiple (NIBD/EBITDA) was 2.2 at 31 December 2023, which is in line with our medium- to long-term target of 2.0-2.5.
Profit after tax from discontinued operations, which in 2023 comprised our Hearing Implants business, amounted to DKK -81 million. The divestment of our cochlear implants business is still expected to close in H1 2024.
Following the launch of our gender diversity targets in 2022, the share of women in top management increased to 27% in 2023, an improvement of 4 percentage points compared to 2022, driven by focused actions, such as inclusive leadership training and inclusive recruitment initiatives.
In H2, Scope 1 and 2 CO2e emissions amounted to 14,973 tonnes, which is a decrease of 15% compared to 2022 and driven by an increased use of renewable electricity.
We have decided to undertake a review of strategic options for Communications to explore whether a different owner may be better positioned to accelerate growth and to allow the business to realise its full potential. The review is expected to be completed by the end of H1 2024. For accounting purposes, the business will be recognised as part of discontinued operations in 2024 and going forward.
Outlook for 2024
Our outlook for 2024 for continuing operations (Hearing Healthcare) is summarised in the table below:
Metric
Outlook for 2024
Organic growth
4-8%
EBIT
DKK 4,600-5,000 million
Share buy-backs
More than DKK 2,000 million
The outlook is based on a number of key assumptions as described below:
We expect the unit growth rate in the global hearing aid market in 2024 to be in line with the structural growth rate of 4-6%. We expect a negative impact of ASP declines around the normal level of 1-2% due to mix effects.
We expect the cash allocated to bolt-on acquisitions in 2024 to be higher than normal due to the postponement of some acquisitions from 2023 and a good pipeline of attractive opportunities.
Communications will be recognised as part of discontinued operations. We expect profit after tax related to Communications to be negative by DKK 100-150 million. This relates entirely to an expected full-year operating loss and does not include any financial impact related to the review of strategic options.
The divestment of our cochlear implants business is expected to close in H1 2024. Our bone anchored hearing systems business will remain with the Group for now, pending a review of our strategic options. For the full year 2024, we expect profit after tax related to Hearing Implants to be around DKK 0 million.
For modelling purposes, we provide further assumptions for 2024 below:
Metric
Assumption for 2024
Acquisitive growth
1% based on revenue from acquisitions completed as of 4 February 2024
FX growth
-1% based on exchange rates as of 4 February 2024 and including the impact of hedging
Effective tax rate
Around 24%
Profit after tax from discontinued operations
Negative by DKK 100-150 million, entirely related to Communications, with profit after tax for Hearing Implants to be around DKK 0 million
Conference call details
Demant will host a conference call on 6 February 2024 at 14:00 CET. A live webcast of the call will be available on our website www.demant.com. If you would like to attend the conference call to ask questions, please pre-register here to receive the dial-in numbers and access codes. A presentation for the call will be uploaded on our website shortly before the call.
Further information:
Søren Nielsen, President & CEO
Phone +45 3917 7300
www.demant.com
Other contacts:
René Schneider, CFO
Mathias Holten Møller, Head of Investor Relations
Peter Pudselykke, Investor Relations Officer
Henrik Axel Lynge Buchter, Manager of External Communications
Key figures and financial ratios (1/2)
(DKK million)
H2 2023
H2 2022
Change
FY 2023
FY 2022
Change
Hearing Healthcare
Revenue
10,907
9,700
12%
21,601
18,645
16%
Organic growth
13%
5%
14%
5%
Gross margin
76.1%
75.9%
75.6%
76.1%
EBIT
2,344
1,748
34%
4,506
3,443
31%
EBIT margin
21.5%
18.0%
20.9%
18.5%
Communications
Revenue
381
508
-25%
842
1,060
-21%
Organic growth
-22%
-13%
-19%
-13%
Gross margin
17.8%
43.9%
26.6%
45.0%
EBIT
-210
-129
n.a.
-358
-236
n.a.
EBIT margin
-54.9%
-25.4%
-42.5%
-22.3%
Group
Income statement
Revenue
11,288
10,208
11%
22,443
19,705
14%
Organic growth
11%
3%
12%
4%
Gross margin
74.2%
74.3%
73.7%
74.4%
EBITDA
2,820
2,255
25%
5,482
4,383
25%
EBITDA margin
25.0%
22.1%
24.4%
22.2%
EBIT
2,134
1,619
32%
4,148
3,207
29%
EBIT margin
18.9%
15.9%
18.5%
16.3%
Net financial items
-395
-185
114%
-754
-280
169%
Profit after tax – continuing operations
1,297
1,118
16%
2,555
2,276
12%
Profit after tax – discontinued operations
–81
-84
n.a.
-757
-192
n.a.
Profit for the period
1,216
1,035
17%
1,798
2,084
-14%
Balance sheet
Total assets
30,546
29,857
2%
30,546
29,857
2%
Net interest-bearing debt (NIBD)
12,280
12,711
-3%
12,280
12,711
-3%
Equity
9,338
8,562
9%
9,338
8,562
9%
Cash flow statement
Cash flow from operating activities (CFFO)
2,472
1,707
45%
4,335
2,622
65%
Investment in property, plant and equipment, net
327
329
-1%
633
630
0%
Free cash flow (FCF)
1,993
1,219
63%
3,483
1,617
115%
Share buy-backs
829
533
56%
846
1,840
-54%
We refer to section 9.1 of Annual Report 2023 for a description of the accounting policies for key figures and financial ratios.
Key figures and financial ratios (2/2)
H2 2023
H2 2022
Change
FY 2023
FY 2022
Change
Other key figures
Gearing multiple (NIBD/EBITDA)
2.2
2.9
2.2
2.9
Earnings per share (EPS) – continuing operations, DKK
5.81
4.99
17%
11.44
10.06
-14%
Earnings per share (EPS), DKK
5.44
4.61
18%
8.04
9.21
-13%
Free cash flow per share (FCFPS), DKK
8.93
5.40
65%
15.61
7.15
118%
Share price, end of period, DKK
296.00
192.55
54%
296.00
192.55
54%
Average number of shares outstanding, million
223.13
224.06
-0%
223.13
226.01
-1%
Average number of employees
21,413
20,349
5%
21,168
19,239
10%
Scope 1 and 2 CO2e emissions (tonnes)1
14,973
17,644
-15%
30,469
35,862
-15%
Gender diversity, Board of Directors (women/men)2
40/60%
40/60%
40/60%
40/60%
Gender diversity, all managers (women/men)
47/53%
44/56%
47/53%
44/56%
Gender diversity, top level management (women/men)
27/73%
23/77%
27/73%
23/77%
1 Figures in 2022 have been restated in order to recognise new acquisitions, which were not included in 2022.
2 Shareholder-elected members.
Full-year growth rates by business area
Revenue (DKK million)
Growth
Business area
FY 2023
FY 2022
Organic
Acquisitive
LCY
FX
Reported
Hearing Aids, total sales
12,112
9,991
21%
0%
21%
1%
21%
Hearing Aids, internal sales
-2,076
-1,760
14%
6%
20%
-2%
18%
Hearing Aids, external sales
10,036
8,231
22%
-1%
21%
1%
22%
Hearing Care
9,083
8,123
8%
7%
15%
-3%
12%
Diagnostics
2,482
2,291
7%
4%
11%
-3%
8%
Hearing Healthcare
21,601
18,645
14%
3%
17%
-1%
16%
Communications
842
1,060
-19%
0%
-19%
-2%
-21%
Group
22,443
19,705
12%
3%
15%
-1%
14%
Contacts
Henrik Axel Lynge Buchter, External Communication Manager, Corporate Communication & Sustainability, +45 2264 9982, heey@demant.com
About Demant A/S
Demant is a world-leading hearing healthcare group that offers solutions and services to help people with hearing loss connect with the world around them. In every aspect, from hearing devices, hearing implants, diagnostics to audio and video solutions and hearing care all over the world, Demant is active and engaged. Our innovative technologies and know-how help improve people’s health and hear-ing. We create life-changing differences through hearing health.
Attachments
2024-03 Results for 2023 and outlook for 2024.pdf
