Coloplast (COLO) Q1 24/25 earnings summary

Executive summary

• Organic revenue grew 8% in Q1 2024/25, with reported revenue up 6% to DKK 7,026 million, despite negative impacts from divestments and currency.

• EBIT before special items rose 5% to DKK 1,912 million, with a margin of 27%, in line with expectations.

• Growth was driven by strong performance in Chronic Care, double-digit gains in Advanced Wound Care and Voice & Respiratory Care, and new product launches.

• Interventional Urology was negatively affected by a voluntary product recall, partially offset by solid Endourology results.

• Skin Care portfolio divested in December 2024 to streamline operations and improve Advanced Wound Care profitability.

Financial highlights

• Gross profit reached DKK 4,750 million, gross margin stable at 68%.

• EBITDA before special items was DKK 2,240 million, up 5% year-over-year; EBITDA margin at 32%.

• Adjusted net profit before special items increased by DKK 214 million to DKK 1,438 million; adjusted diluted EPS before special items up 17% to DKK 6.38.

• Free cash flow increased 23% to DKK 1,874 million, aided by working capital improvements and the Skin Care divestment.

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

Outlook and guidance

• FY 2024/25 organic growth guidance maintained at 8-9%; reported growth in DKK expected at ~7% due to divestments.

• EBIT margin before special items expected around 28%; effective tax rate revised to ~40% due to Kerecis IP transfer.

• Capital expenditures forecast at DKK 1.4 billion; long-term tax rate expectation remains at 23%.

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

• Capex-to-sales ratio targeted at 4%; net working capital to sales ratio at 24-25%.