Coloplast (COLO) Q1 24/25 earnings summary

Executive summary

• Q1 2024/25 delivered 8% organic revenue growth and 6% reported revenue growth to DKK 7,026 million, in line with expectations and driven by strong performance in Chronic Care, Advanced Wound Care, and Voice & Respiratory Care.

• EBIT before special items was DKK 1,912 million, up 5% year-over-year, with a margin of 27%.

• Adjusted return on invested capital after tax and before special items was 15%, matching last year.

• Kerecis delivered 32% growth, remains covered under the updated U.S. LCD policy with implementation delayed to April 2025.

• Divestment of Skin Care business in December 2024 improved EBIT margin and contributed to free cash flow.

Financial highlights

• Gross profit was DKK 4.8 billion, with a stable gross margin of 68%.

• Operating profit before special items was DKK 1.9 billion, up 5% year-over-year; EBIT margin before special items was 27%.

• Adjusted net profit before special items was DKK 1.4 billion, a 17% increase; adjusted diluted EPS before special items rose 17% to DKK 6.38.

• Free cash flow for Q1 was DKK 1.9 billion, up 23% year-over-year, supported by divestment proceeds and working capital improvements.

• Net interest-bearing debt rose to DKK 23,852 million; gearing ratio at 2.7x EBITDA.

Outlook and guidance

• FY 2024/25 guidance maintained: organic revenue growth of 8-9%, reported revenue growth around 7%, and EBIT margin before special items of approximately 28%.

• Effective tax rate for the year expected at 40% due to Kerecis IP transfer; long-term tax rate expectation remains 22%-23%.

• Capex for the year expected at DKK 1.4 billion, including new manufacturing in Portugal.

• Kerecis expected to contribute about 1 percentage point to group organic growth.

• Board targets a payout ratio of 60-80% of net profit via dividends and share buybacks.