6.5.2024 07:28:47 CEST | Demant A/S |
Delårsrapport/Periodemeddelelse (Q1 og Q3)
Selskabsmeddelelse nr. 2024-08 6. maj 2024
Periodemeddelelse for Q1 2024
Organisk omsætningsvækst på 3 % i Q1 drevet af gode resultater i Hearing Aids og Diagnostics
Nyligt lanceret Oticon Intent har fået en flot modtagelse, særligt hos de uafhængige forhandlere
Forventninger til 2024 fastholdes: Organisk vækst på 4-8 % og EBIT før særlige poster på DKK 4.600-5.000 mio.
“Samlet set er vi tilfredse med starten på året, hvor vores Diagnostics- og Hearing Aids-forretningsområder har fortsat udviklingen fra 2023 og leveret god vækst, mens Hearing Care oplevede en lidt langsommere start på året, men oplevede en forbedring i løbet af perioden. Det samlede resultat er på niveau med vores antagelser, og vi bibeholder vores forventninger til året. Når vi kigger frem mod de kommende kvartaler, så tror vi på øget vækst, som vil være drevet af vores nyligt lancerede flagskibshøreapparater, deriblandt Oticon Intent. I Q1 eksekverede vi også vores opdaterede strategi om udelukkende at fokusere på at være en hearing healthcare-virksomhed dedikeret til at forbedre livet for så mange mennesker som muligt ved hjælp af markedsledende innovation og distribution,” siger Søren Nielsen, koncernchef & administrerende direktør for Demant.
Omsætning (DKK mio.)
Vækst
Forretningsområde
Q1 2024
Q1 2023
Organisk
Akkvisitiv
LCY
FX
Rapporteret
Hearing Aids, samlet omsætning
3.107
3.048
3 %
0 %
3 %
-1 %
2 %
Hearing Aids, intern omsætning
-599
-570
1 %
4 %
5 %
0 %
5 %
Hearing Aids, ekstern omsætning
2.508
2.478
4 %
-1 %
3 %
-2 %
1 %
Hearing Care
2.318
2.218
0 %
5 %
5 %
0 %
5 %
Diagnostics
597
566
7 %
0 %
7 %
-1 %
5 %
Group
5.423
5.262
3 %
2 %
4 %
-1 %
3 %
Efter meget stærk vækst i sammenligningsperioden realiserede koncernen organisk vækst på 3 % i Q1, som var drevet af Hearing Aids og Diagnostics. Vækst fra akkvisitioner tilføjede 2 % og valutakurseffekter -1 %, hvilket resulterede i en samlet rapporteret vækst på 3 %.
Hearing Aids leverede fortsat gode resultater i Q1, hvilket resulterede i organisk vækst på 4 %, som kan tilskrives eksterne kunder. Til trods for meget stærke resultater i sammenligningsperioden skønner vi, at vores markedsandel i værdi blev bibeholdt på et stabilt niveau. Vores nyligt lancerede premium-høreapparater har fået en flot modtagelse af kunderne, især blandt uafhængige forhandlere, hvor vi har set en sekventiel øgning af vores markedsandel. Væksten i perioden var udelukkende drevet af den gennemsnitlige salgspris (ASP), hvorimod stykvæksten var negativ, hvilket til dels skyldes lavere salg til visse større kunder.
Hearing Care oplevede en langsom start på året med flad organisk vækst i Q1, hvilket er en smule under forventningerne. Denne udvikling skyldes primært et langsomt momentum i Frankrig, hvor kundetilstrømningen og konverteringsraten var lavere end forventet. Kina trak ligeledes den organiske vækst nedad, primært som følge af et svagt marked. Oticon Intent er nu blevet introduceret på de fleste af vores markeder, hvilket bidrog til en positiv ASP i perioden. I løbet af perioden har vi set en forbedret run rate, og vi forventer, at væksten vil øges fremadrettet. I overensstemmelse med vores strategi fortsatte akkvisitioner – primært i Tyskland og Belgien – med at bidrage til væksten.
Diagnostics leverede solide resultater, der resulterede i organisk vækst på 7 % i Q1, med stærke bidrag fra vores virksomheder, der beskæftiger sig med service samt løsninger til tilpasning af høreapparater.
Koncernens bruttomargin var bedre end forventet og er steget betragteligt sammenlignet med Q1 2023. Denne vækst var især drevet af vores fortsatte fokus på at forbedre vores produkt- og kanalmiks med henblik på at øge ASP’en i Hearing Aids samt af forbedringer i bruttomarginen i Diagnostics. Væksten blev realiseret til trods for et negativt forretningsmiks i perioden.
I overensstemmelse med vores forventninger har vi i Q1 set lav tocifret vækst i lokal valuta i OPEX, hvoraf hovedparten var organisk vækst. Det øgede OPEX afspejler dels lavere udgifter i sammenligningsperioden, og dels vores engagement i forhold til at investere i fremtidig vækst. Vi fortsætter således med at øge vores F&U-kapacitet og udvide vores distribution både organisk og gennem akkvisitioner.
Koncernens EBIT før særlige poster var på niveau med vores forventninger, om end en smule lavere, hvis der sammenlignes med et meget stærkt Q1 2023.
Som følge af god lønsomhed var både CFFO og FCF positive, om end lavere end sidste år på grund af højere betalt skat i Q1.
Resultatet efter skat i ophørende virksomheder, som omfatter Hearing Implants og Communications, var negativt og i overensstemmelse med forventningerne. Vi forventer fortsat, at frasalget af vores cochlear-implantatforretning vil blive afsluttet i H1 2024, og at evalueringen af de strategiske muligheder for Communications vil være afsluttet senest ved udgangen af H1 2024.
I H1 vil vi indregne to ekstraordinære engangsposter, som vil have en positiv, ikkelikvid nettoeffekt på ca. DKK 125 mio. på EBIT. Disse poster vil blive indregnet på en separat linje som særlige poster, og for dette år vil vi således i vores forventninger henvise til EBIT som EBIT før særlige poster.
Efter Q1 har vi lukket en akkvisition af en værditilførende distributør i Hearing Aids, hvilket vil medføre en usædvanligt stor, ikkeoperationel og ikkelikvid positiv regulering af regnskabsværdien af vores eksisterende ejerskab og vil blive indregnet under særlige poster.
Vi har opdateret den regnskabsmæssige behandling af visse earn-out-betalinger relateret til akkvisitioner, hvilket vil medføre en ikkelikvid omkostning, der indregnes under særlige poster.
Pr. 31. marts 2024 havde koncernen tilbagekøbt aktier for DKK 739 mio.
Forventninger til 2024
Vores forventninger til 2024 er uændrede og opsummeres i nedenstående tabel:
Parameter
Forventninger til 2024
Organisk vækst
4-8 %
EBIT før særlige poster
DKK 4.600-5.000 mio.
Aktietilbagekøb
Mere end DKK 2.000 mio.
Forventningerne er baseret på en række nøgleantagelser som beskrevet nedenfor (ændringer i forhold til seneste forventninger er med fed skrift):
På vores Kapitalmarkedsdag i marts 2024 opdaterede vi vores mellemlange til langsigtede syn på høreapparatmarkedet. Vi forventer således, at stykvækstraten på det globale høreapparatmarked i 2024 vil være på niveau med den strukturelle vækstrate på 4-6 %, og at ASP-udviklingen på høreapparatmarkedet vil være stort set flad.
Vi forventer, at omfanget af mindre akkvisitioner i 2023 vil overgå det normale niveau på grund af de akkvisitioner, der allerede er foretaget i 2024, samt en fortsat god pipeline af attraktive opkøbsmuligheder.
Vi forventer, at underskuddet efter skat i Communications vil være DKK 100-150 mio. Dette relaterer sig udelukkende til et forventet driftsunderskud for hele året og omfatter ikke den finansielle effekt, som evalueringen af de strategiske muligheder måtte have.
Frasalget af vores cochlear-implantatforretning forventes at blive afsluttet i H1 2024. Vores forretning for benforankrede høresystemer vil forblive en del af koncernen indtil videre, mens evalueringen af vores strategiske muligheder pågår. For helåret 2024 forventer vi, at resultatet efter skat for Hearing Implants vil være ca. DKK 0 mio.
Yderligere antagelser omkring den finansielle modellering for 2024, som er opdateret pr. 5. maj 2024:
Parameter
Antagelser vedrørende 2024
Akkvisitiv vækst
2 % baseret på omsætning fra akkvisitioner gennemført pr. 5. maj 2024 (tidligere 1 %)
Valutakursvækst
-1 % baseret på valutakurser pr. 5. maj 2024 og inkl. effekten af valutakurssikring
Effektiv skattesats
Omkring 24 %
Resultat efter skat vedrørende ophørende aktiviteter
Negativt med DKK 100-150 mio., hvilket udelukkede tilskrives Communications, og resultat efter skat vedrørende Hearing Implants på ca. DKK 0 mio.
Særlige poster
Positive med cirka DKK 125 mio.
Telekonference
Demant afholder en telekonference den 6. maj 2024 kl. 12.00 CEST. 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
Peter Pudselykke, Head of Investor Relations
Henrik Axel Lynge Buchter, Manager of External Communications
Hearing Healthcare
Markedsudvikling
Samlet set så vi vækst i Q1 på markedet for høresundhed, som vi henvender os til, og som omfatter markederne for høreapparater samt diagnostisk udstyr og services.
Høreapparatmarkedet
Baseret på tilgængelige markedsstatistikker, som dækker ca. totredjedele af markedet for høreapparater, og på vores egne antagelser skønner vi, at det globale høreapparatmarked oplevede stykvækst på ca. 3 % i Q1 sammenlignet med samme periode i 2023. Væksten var positiv på tværs af regioner, og vi skønner, at ændringer i geografi- og kanalmikset medførte en moderat positiv ASP-udvikling, som førte til værditilvækst på høreapparatmarkedet, hvilket stort set er i overensstemmelse med vores forventninger.
Skønnet stykvækst på markedet for høreapparater pr. region
2023
2024
Region
Q1
Q2
Q3
Q4
FY
Q1
Europa
4 %
-4 %
7 %
2 %
2 %
1 %
Nordamerika
9 %
5 %
11 %
16 %
10 %
10 %
Heraf USA (kommercielt marked)
9 %
5 %
12 %
19 %
11 %
13 %
Heraf USA (VA)
9 %
4 %
4 %
4 %
5 %
-1 %
Resten af verden
9 %
10 %
7 %
10 %
9 %
1 %
Global
7 %
3 %
8 %
8 %
7 %
3 %
Sammenlignet med samme periode i 2023 skønner vi, at markedsstykvæksten i Europa var 1 % i Q1. Væksten var primært drevet af Tyskland, men også af Frankrig, hvor vi oplevede mindre vækst og så fortsatte tegn på stabilisering efter høresundhedsreformen, der blev implementeret i 2021. I Storbritannien var væksten negativ, hvilket især skyldes NHS, som oplevede meget stærk vækst i Q1 2023, hvorimod det private marked oplevede beskeden vækst. Adskillige andre lande genererede også god vækst i perioden.
Væksten i Nordamerika var 10 % i Q1 og var drevet af en stærk udvikling på det amerikanske kommercielle marked. Væksten på tværs af kanaler var bredt funderet med positiv udvikling inden for både forsikringdækket behandling (managed care) og segmentet for egenbetaling. I Veteran Affairs (VA) var markedsvæksten svagt negativ, og kanalen fortsatte med at halte bagefter det amerikanske kommercielle marked, hvis vi sammenligner med niveauerne før pandemien. I Canada var væksten solid i perioden.
Ser vi ud over Europa og Nordamerika, vurderer vi, at markedsstykvæksten i Resten af verden-regionen var 1 %. Væksten i både Japan og Kina var negativ som følge af en relativt stærk sammenligningsperiode efter opsvinget efter coronavirus-pandemien og for sidstnævnte også som følge af et fortsat afdæmpet marked. Australien oplevede en lille vækst, og vi vurderer, at adskillige udviklingsmarkeder leverede god vækst i Q1 – især Latinamerika.
Markedet for diagnostisk udstyr
Vi skønner, at sammenlignet med samme periode sidste år var markedsvækstraten i Q1 på niveau med den skønnede strukturelle vækstrate på 4-6 % om året.
Hearing Aids
Som forventet leverede Hearing Aids solid vækst, hvilket førte til en samlet organisk vækst på 3 % og organisk vækst i salget fra eksterne kunder på 4 % i Q1. Væksten i perioden var negativt påvirket af meget stærke resultater i Q1 2023. Derudover så vi vækst i valutakurserne på -1 %.
Vores nyligt lancerede premium-høreapparater har fået en flot modtagelse af kunderne, især blandt kunderne i den uafhængige kanal. Dette medførte et meget positivt ASP-bidrag i Q1, hvilket blev yderligere understøttet af lavere salg til visse store kunder.
I Europa var væksten flad. Udviklingen var drevet af vores større markeder, hvor Frankrig oplevede negativ vækst på grund af tidspunktet for produktlanceringen, og Storbritannien var påvirket af negativ vækst i NHS. I Tyskland var væksten flad, men vi oplevede god vækst på en række af vores mellemstore markeder.
Nordamerika leverede solid vækst i Q1, som blev genereret i tillæg til et i forvejen meget stærkt Q1 2023. På det amerikanske kommercielle marked oplevede vi solid vækst fra både kæder og uafhængige forhandlere, hvor væksten i sidstnævnte kanal blev drevet af lanceringen af vores nye premium-høreapparater, hvilket førte til en sekventiel øgning af vores markedsandel. I Q1 har vi arbejdet på at optimere strategien for vores brands i USA for at positionere vores produkter tydeligere på tværs af kanaler, hvilket i overgangsperioden har ført til negativ vækst i forsikringsdækket behandling. I VA var væksten særligt stærk, hvilket afspejler, at vi til trods for negativ stykvækst i kanalen formåede at vinde markedsandele i 2023. I Canada oplevede vi fortsat et godt momentum i Q1.
I Asien var den organiske vækst positiv, drevet af god vækst på flere af vores mindre markeder. Væksten i Kina var dog negativ, hvilket afspejler et afdæmpet marked samt et stærkt sammenligningsgrundlag på grund af opsvinget efter coronavirus-pandemien. I Pacific-regionen oplevede vi stærk vækst i både Australien og New Zealand, mens vi oplevede flad vækst i vores Other-region, som hovedsageligt omfatter mindre udviklingsmarkeder.
Hearing Care
I Hearing Care oplevede en langsom start på året med flad organisk vækst i Q1, hvilket er lidt under vores forventninger og skyldes lavere kundetilstrømning og konverteringsrater end forventet i Frankrig samt et afdæmpet kinesisk marked. Den organiske vækst var drevet af ASP’en. I løbet af perioden oplevede vi en forbedret run rate, og vi forventer at forbedre væksten fremadrettet. Vi oplevede fortsat en positiv effekt på væksten af akkvisitioner, som bidrog med 5 % og i overvejende grad var drevet af Tyskland og Belgien.
Hvis vi kigger på de forskellige regioner, så leverede Europa vækst i lokal valuta drevet af akkvisitioner. I Frankrig, som er vores største marked i Europa, var den organiske vækst negativ, men vi så god vækst på andre markeder. Da påsken faldt i slutningen af marts, havde dette en mindre negativ indvirkning på salget.
Nordamerika leverede flad organisk vækst drevet af mindre vækst i Canada, som blev udlignet af marginalt negativ vækst i USA.
I Asien oplevede Kina negativ vækst som følge af lav forbrugertillid, som fortsat påvirker høreapparatmarkedet i landet. I Pacific-regionen så vi stærk organisk vækst i Australien, drevet af et forbedret produktmiks.
Diagnostics
Efter endnu et godt år i 2023 kom den organiske vækst i Diagnostics godt fra start og voksede 7 % i Q1. Denne udvikling blev delvist understøttet af lavere vækst i sammenligningsperioden, hvor vi oplevede nogle leveringsforsinkelser som følge af ramp-up af vores produktionssted i Polen sidste år. Valutakurseffekter var -1 %.
Den organiske vækst var bredt funderet på tværs af regioner, dog ikke i Kina, hvor det afdæmpede marked, vi så i 2023, stadig var en realitet i Q1, hvilket medførte negativ vækst. I Europa så vi god kommerciel fremdrift, hvilket også var tilfældet i Nordamerika. For den samlede Diagnostics-forretning var salgsvæksten primært drevet af vores forretninger for services og løsninger til tilpasning af høreapparater.
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
2024-08 Periodemeddelelse for Q1 2024.pdf
6.5.2024 07:28:47 CEST | Demant A/S |
Interim report (Q1 and Q3)
Company announcement no 2024-08 6 May 2024
Interim Management Statement for Q1 2024
Organic revenue growth of 3% in Q1 driven by good performances in Hearing Aids and Diagnostics
Recently launched Oticon Intent has seen strong initial reception, especially in the independent channel
Outlook for 2024 maintained: Organic growth of 4-8% and EBIT before special items of DKK 4,600-5,000 million
“Overall, we are pleased with the start to the year where our Diagnostics and Hearing Aids business areas continued the trend from 2023 and delivered good growth, while Hearing Care saw a slower start to the year, with performance improving during the period. These results combined are in line with our expectations, and we maintain our outlook for the year. As we look towards the upcoming quarters, we expect to see increased growth, which will be driven by our recently launched hearing aid flagship products, including Oticon Intent. In Q1, we also delivered on our updated strategic direction to be a fully focused hearing healthcare company dedicated to improving the lives of as many people as possible through market-leading innovation and distribution,” says Søren Nielsen, President & CEO of Demant.
Revenue (DKK million)
Growth
Business area
Q1 2024
Q1 2023
Organic
Acquisitive
LCY
FX
Reported
Hearing Aids, total revenue
3,107
3,048
3%
0%
3%
-1%
2%
Hearing Aids, internal revenue
-599
-570
1%
4%
5%
0%
5%
Hearing Aids, external revenue
2,508
2,478
4%
-1%
3%
-2%
1%
Hearing Care
2,318
2,218
0%
5%
5%
0%
5%
Diagnostics
597
566
7%
0%
7%
-1%
5%
Group
5,423
5,262
3%
2%
4%
-1%
3%
Following very strong growth in the comparative period, the Group realised organic growth of 3% in Q1, which was driven by Hearing Aids and Diagnostics. Growth from acquisitions added 2% and exchange rate effects -1%, leading to total reported growth of 3%.
Hearing Aids continued to see good performance in Q1, resulting in organic growth attributable to external customers of 4%. Despite very strong performance in the comparative period, we estimate that our market share in value remained stable. Our recently launched premium hearing aids have seen strong initial reception amongst customers, particularly in the independent channel where we have seen sequential market share gains. Growth in the period was entirely driven by the average selling price (ASP), whereas unit growth was negative, in part due to lower sales to certain larger accounts.
Hearing Care saw a slow start to the year with flat organic growth in Q1, which is slightly below expectations. This development was predominantly due to slow momentum in France where traffic and conversion rates were lower than expected. China was also a drag on organic growth, primarily due to weak market dynamics. Oticon Intent has now been introduced to most of our markets, which contributed to a positive ASP in the period. During the period, we have seen an improved run rate, and we expect growth to increase going forward. In line with our strategy, acquisitions – primarily in Germany and Belgium – continued to contribute to growth.
Diagnostics saw solid performance, leading to organic growth of 7% in Q1, with strong growth contributions from our services and hearing instrument fitting solutions businesses.
The Group’s gross margin was better than expected and improved meaningfully vs. Q1 2023. This growth was particularly driven by our continued focus on improving our product and channel mix to lift the ASP in Hearing Aids and by gross margin improvements in Diagnostics, and it was realised despite a negative business mix in the period.
In line with expectations, OPEX saw low double-digit growth in local currencies in Q1 of which most was organic. The increased OPEX partly reflects lower spending in the comparative period, and partly our commitment to invest in future growth. We thus continued to increase our R&D capacity and expand our distribution both organically and through acquisitions.
The Group’s EBIT before special items was in line with expectations, albeit slightly down compared to a very strong Q1 2023.
Driven by good profitability, CFFO and FCF were positive, although lower than last year due to higher tax payments in Q1.
Profit after tax from discontinued operations, which comprise Hearing Implants and Communications, was negative and in line with expectations. We still expect the divestment of our cochlear implants business to close in H1 2024, and the strategic review of Communications to be completed by the end of H1 2024.
In H1, we will recognise two extraordinary non-recurring items, which will have a positive, non-cash net impact of around DKK 125 million on EBIT. These items will be recognised on a separate line as special items, and for this year, we will thus refer to EBIT in our outlook as EBIT before special items.
After Q1, we have closed an acquisition of a value-added distributor in Hearing Aids, which will result in an unusually large, non-operational and non-cash step-up gain on the book value of our existing ownership and will be recognised under special items.
We have updated the accounting treatment of certain earn-out payments related to acquisitions, which will result in a non-cash cost to be recognised under special items.
As of 31 March 2024, the Group had bought back shares worth DKK 739 million.
Outlook for 2024
Our outlook for 2024 remains unchanged and is summarised in the table below:
Metric
Outlook for 2024
Organic growth
4-8%
EBIT before special items
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 (changes in bold):
At our Capital Markets Day in March 2024, we updated our medium- to long-term view on the hearing aid market. We thus 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% and that the hearing aid market will see a flattish ASP development in the year.
We expect the cash allocated to bolt-on acquisitions in 2024 to be higher than normal due to acquisitions already made in 2024 and a continuously good pipeline of attractive opportunities.
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, which are updated as of 5 May 2024:
Metric
Assumption for 2024
Acquisitive growth
2% based on revenue from acquisitions completed as of 5 May 2024 (previously 1%)
FX growth
-1% based on exchange rates as of 5 May 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
Special Items
Positive by around DKK 125 million
Conference call details
Demant will host a conference call on 6 May 2024 at 12:00 CEST (noon). A live webcast of the call will be available on our website www.demant.com. If you would like to access 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
Peter Pudselykke, Head of Investor Relations
Henrik Axel Lynge Buchter, Manager of External Communications
Hearing Healthcare
Market trends
Overall, the hearing healthcare market we address, which comprises the markets for hearing aids and diagnostic instruments and services, saw growth in Q1.
Hearing aid market
Based on available market statistics, covering around two-thirds of the hearing aid market, and on our own assumptions, we estimate that the global hearing aid market saw unit growth of around 3% in Q1 compared to the same period in 2023. Growth was positive across regions, and we estimate that geography and channel mix changes resulted in a slightly positive ASP development, leading to value growth in the hearing aid market, which is roughly in line with our expectations.
Estimated hearing aid market unit growth by region
2023
2024
Region
Q1
Q2
Q3
Q4
FY
Q1
Europe
4%
-4%
7%
2%
2%
1%
North America
9%
5%
11%
16%
10%
10%
Hereof US (commercial)
9%
5%
12%
19%
11%
13%
Hereof US (VA)
9%
4%
4%
4%
5%
-1%
Rest of world
9%
10%
7%
10%
9%
1%
Global
7%
3%
8%
8%
7%
3%
Compared to the same period in 2023, we estimate that in Q1, market unit growth in Europe was 1%. Growth was primarily driven by Germany and also by France where we saw slight growth and continuous signs of stabilisation following the hearing healthcare reform implemented in 2021. In the UK, growth was negative, particularly driven by the NHS, which saw very strong growth in Q1 2023, whereas the private market saw modest growth. Several other countries also saw good growth in the period.
Growth in North America was 10% in Q1 and was fuelled by a strong development in the US commercial market. Growth across channels was broad-based with good development in both the managed care and the private pay segment. In Veterans Affairs (VA), market growth was slightly negative, and the channel continued to lag behind the US commercial market if we compare to pre-pandemic levels. In Canada, growth was solid in the period.
Looking beyond Europe and North America, we estimate that market unit growth in the Rest of world region was 1%. Growth in both Japan and China was negative due to a relatively strong comparative period following the post-coronavirus recovery and for the latter also due to continuously weak market dynamics. Australia saw slight growth, and we estimate that several emerging markets delivered good growth in Q1, particularly Latin America.
Diagnostics market
We estimate that, compared to the same period last year, the market growth rate in Q1 was in line with the estimated structural growth rate of 4-6% per year.
Hearing Aids
As expected, our Hearing Aids business delivered solid growth, leading to total organic growth of 3% and organic growth from external customers of 4% in Q1. Growth in the period was negatively impacted by very strong performance in Q1 2023. In addition, exchange rates saw growth of -1%.
Following the recent launch of premium hearing aids in all brands, we have seen strong initial reception amongst customers, particularly in the independent channel. This led to a very positive ASP contribution in Q1, which was further supported by lower sales to certain large accounts.
In Europe, growth was flat. The development was driven by our major markets where France saw negative growth due to the timing of the product launch and the UK was impacted by negative growth in the NHS. In Germany, growth was flat, but we saw good growth in a number of our medium-sized markets.
North America delivered solid growth in Q1, which was generated on top of a very strong Q1 2023. In the US commercial market, we saw solid growth from both chains and independents, with growth in the latter channel being fuelled by the launch of our new premium hearing aids, leading to sequential market share gains. In Q1, we have worked on optimising our brand strategy in the US to position our products more clearly across channels, which in the transition period has led to negative growth in managed care. In VA, growth was strong, reflecting market share gains realised during 2023 despite negative unit growth in the channel. In Canada, we continued to see good momentum in Q1.
In Asia, organic growth was positive, driven by good growth in several of our small markets. Growth in China was, however, negative, which reflects soft market dynamics as well as a strong comparative base due to post-coronavirus recovery. In the Pacific region, we saw strong growth in both Australia and New Zealand, whereas we saw flat growth in our Other region, which mostly comprises minor emerging markets.
Hearing Care
In Hearing Care, we saw a slow start to the year with flat organic growth in Q1, which is slightly below our expectations and due to lower traffic and conversion rates than expected in France and weak market dynamics in China. Organic growth was driven by the ASP. During the period, we have seen an improved run rate, and we expect growth to increase going forward. We continued to see a positive impact on growth from acquisitions, which contributed by 5% and was predominantly driven by Germany and Belgium.
In terms of regions, Europe delivered growth in local currencies driven by acquisitions. In France, which is our largest market in Europe, organic growth was negative, but other markets saw good growth. In some markets, the timing of Easter at the end of March had a slightly negative impact on sales.
North America delivered flat organic growth driven by slight growth in Canada, which was offset by slightly negative growth in the US.
In Asia, China saw negative growth driven by low consumer confidence, which continues to impact the hearing aid market in the country. In our Pacific region, organic growth in Australia was strong, driven by an improved product mix.
Diagnostics
Following another good year in 2023, organic growth in Diagnostics was off to a good start and grew 7% in Q1. This was partly supported by lower growth in the comparative period, which saw some shipment delays from the ramp-up of our production site in Poland last year. Exchange rate effects were -1%.
Organic growth was broad-based across regions, except for China where we saw the weak market dynamics from 2023 continue into Q1 and leading to negative growth. In Europe, we saw good commercial traction, which was also the case in North America. For the total Diagnostics business, sales growth was primarily driven by our service and hearing instrument fitting solutions businesses.
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
2024-08 Interim Management Statement for Q1 2024.pdf
