Demant (DEMANT) investor relations material

Executive summary

• Achieved 2% organic growth and 5% growth in local currencies for 2025, with total revenue reaching DKK 22,971 million; acquisitions, especially KIND Group, contributed significantly, while currency headwinds reduced reported growth.

• Hearing Care became the largest business area, driven by the acquisition of KIND Group in Germany, which closed in December and expanded market leadership.

• Introduced Oticon Zeal in selected markets, generating excitement and momentum for 2026, with a global rollout planned.

• Divested EPOS and Oticon Medical to focus on core hearing healthcare.

• Sustainability progress included improved lives, increased hearing tests, reduced GHG emissions, and enhanced gender diversity in leadership.

Financial highlights

• Gross margin declined by 0.6 percentage points to 75.6% due to ASP headwinds and product mix.

• EBIT before special items was DKK 3,960 million, down 10% year-over-year, with a margin of 17.2%.

• Free cash flow for FY 2025 was DKK 3,094 million, a decrease of 11% from the prior year.

• Net debt increased due to KIND acquisition, with gearing at 3.4x, above the target range.

• Net interest-bearing debt increased 38% to DKK 18,742 million, mainly due to the KIND acquisition.

Outlook and guidance

• 2026 organic growth expected at 3%-6%, with EBIT before special items of DKK 4.1-4.5 billion.

• Share buyback paused in 2026 to prioritize deleveraging and return to target gearing within 18-24 months.

• Cost reduction initiatives to deliver DKK 250 million EBIT benefit in 2026, with a two-year program targeting DKK 500 million annual savings by 2028.

• Special items for 2026 expected at DKK 325 million, mainly from KIND integration and restructuring.

• KIND expected to contribute DKK 300 million EBIT in 2026; FX headwind of DKK 200 million expected.