Coloplast (COLO) Q2 24/25 earnings summary

Executive summary

• Interim CEO appointed after management change, with a new strategic direction to be presented at Capital Markets Day in September.

• H1 2024/25 delivered 7% organic revenue growth and 6% reported revenue growth to DKK 13,956 million, with EBIT margin before special items steady at 27%.

• Growth driven by Continence Care, Advanced Wound Care, and Kerecis; Interventional Urology flat due to product recall.

• Skin Care divestment completed, supporting profitability improvement.

• Strategic focus on sustainable growth, innovation, and operational efficiency, including divestments and manufacturing expansion.

Financial highlights

• H1 EBIT before special items DKK 3,803 million, up 5% year-over-year; gross margin at 68%.

• Adjusted ROIC after tax and before special items was 15%, flat year-over-year.

• Adjusted net profit before special items was DKK 2,666 million (+7% YoY); adjusted diluted EPS before special items DKK 11.83.

• Free cash flow for H1 was DKK 2,307 million, a significant improvement from last year’s outflow; FCF-to-sales ratio at 15%.

• Board approved interim dividend of DKK 5 per share (total DKK 1.1 billion).

Outlook and guidance

• FY 2024/25 organic revenue growth guidance revised to around 7% (from 8-9%) due to Interventional Urology recall and China slowdown.

• EBIT margin before special items now expected at 27-28%.

• Reported revenue growth in DKK expected at 4%, reflecting currency headwinds and Skin Care divestment.

• Special items for FY expected at DKK 450 million, mainly for profitability initiatives and asset write-downs.

• Capex and tax rate expectations unchanged; long-term organic growth target 8-10% p.a.