GN Store Nord (GN) Q1 2025 earnings summary

Executive summary

• Q1 2025 group organic revenue declined by 3% year-over-year excluding wind-down, with reported organic growth at -8% and total revenue at DKK 3,986 million, impacted by market uncertainty and U.S. tariffs.

• Strong product launches, notably ReSound Vivia in hearing and new gaming products, drove market share gains and customer engagement, partially offsetting declines.

• Enterprise faced a weak European market and tough comps but maintained market leadership and robust margins through pricing discipline.

• Proactive cost mitigation, supply chain diversification, and price increases were implemented to support margins and cash flow.

• EBITA dropped 44% to DKK 300 million (margin 7.5%), reflecting negative operating leverage and launch costs.

Financial highlights

• Group organic revenue growth was -3% year-over-year excluding wind-down; hearing declined -1%, enterprise -9%, and gaming grew 11%.

• Gross margin improved to 54.9% (up 2 percentage points year-over-year), aided by group synergies but offset by business mix and tariffs.

• EBITA was DKK 300 million (margin 7.5%, down from 12.5%); EBITDA margin at 8%.

• Free cash flow excl. M&A was DKK -395 million, affected by seasonality, higher interest, and tax payments.

• Adjusted leverage ended at 4.1x; net interest-bearing debt at DKK 10,145 million.

Outlook and guidance

• 2025 group organic revenue growth guidance is -3% to +3% (excluding wind-down), with EBITA/EBITDA margin guidance at 11%-13%.

• Free cash flow (excluding M&A) expected to be around DKK -800 million for the year.

• Hearing division expected to deliver 5%-9% organic revenue growth, enterprise -8% to 0%, and gaming -6% to 2%.

• Margin improvement expected in subsequent quarters, with Q1 being the lowest for the year.

• Guidance assumes current tariff rates and continued market uncertainty, especially in Enterprise and Gaming.