Coloplast (COLO) Q3 25/26 earnings summary

Executive summary

• Achieved 6% organic revenue growth and 5% EBIT growth in constant currencies for Q3 and the first nine months of 2025/26, driven by Chronic Care and Interventional Urology, while Biologics faced headwinds from US reimbursement changes.

• Chronic Care remains the core business, representing over 75% of group sales and driving growth, profitability, and cash flow.

• U.S. market identified as the largest value creation opportunity, with strong momentum in Chronic Care and Interventional Urology.

• Leadership changes include a new Chief People Officer and transition in Wound and Tissue Repair leadership, with CEO assuming interim oversight.

• Free cash flow-to-sales ratio improved to 20% from 16% last year, supported by working capital improvements and lower net financial items.

Financial highlights

• Reported revenue for the first nine months was DKK 21,482 million, up DKK 568 million (3%) year-over-year, with organic growth contributing DKK 1.2 billion (6%).

• Gross profit for the first nine months was DKK 14.4 billion, with a gross margin of 67% (down from 68% last year), mainly due to currency effects and ramp-up costs.

• EBIT before special items was DKK 5,599 million, a 2% decrease year-over-year; EBIT margin before special items was 26% (down from 27% last year), impacted by currency and Kerecis ramp-up costs.

• Net profit before special items was DKK 4,289 million, up DKK 510 million year-over-year when adjusted for non-recurring tax expenses; adjusted diluted EPS before special items rose 14%.

• Free cash flow for the first nine months was DKK 4,093 million, a 16% increase year-over-year.

Outlook and guidance

• Full-year 2025/26 guidance unchanged: organic revenue growth of 5%-6%, EBIT growth in constant currencies before special items of ~5%, and ROIC after tax before special items of ~15%.

• Capex-to-sales ratio expected around 5%; effective tax rate around 22%.

• Expect continued negative currency impact (2-3 percentage points on revenue, ~80 basis points on EBIT margin).

• Raw material cost inflation expected at ~1% in H2 and 2%-3% next year.

• Special items expected at DKK 3.1 billion, reflecting the Kerecis impairment.