Coloplast revises full-year organic growth and EBIT margin guidance for 2019/20
18 März 2020 - 11:03PM
Coloplast revises full-year organic growth and EBIT margin guidance
for 2019/20
Due to the impact of the COVID-19 outbreak on the
Interventional Urology business and elective procedures in
primarily the US, Coloplast revises its full-year organic growth
guidance for 2019/20 from 7-8% to 4-6% and EBIT margin guidance
from ~31% in DKK to 30-31% in DKK. The outlook for Ostomy Care,
Continence Care and Wound & Skin Care remains largely
intact.
Coloplast continues to monitor the impact of the Coronavirus
outbreak closely, and the company’s main priority remains the
health and safety of its employees, users, customers, and
communities.
- “Coloplast’s full-year guidance issued on February 6, 2020,
reflected the best information available at the time and assumed
that the situation surrounding the COVID-19 outbreak would
normalise gradually during Q2. China is slowly returning to normal
conditions, but the situation has escalated globally and Coloplast
now expects an impact on the Interventional Urology business, where
a significant share of revenue comes from elective procedures.
Consequently, Coloplast does not expect to meet the organic revenue
growth guidance and EBIT margin guidance provided for the
full-year,” says Coloplast CEO Kristian Villumsen.
The organic revenue growth guidance is lowered from 7-8% at
constant exchange rates and a reported growth in DKK of 7-8% to an
organic revenue growth guidance of 4-6% at constant exchange rates
and a reported growth in DKK of 4-6%. The EBIT margin guidance is
lowered from ~31% at constant exchange rates and ~31% in DKK to
30-31% at constant exchange rates and 30-31% in DKK. Capex guidance
of DKK ~850m and a tax rate of 23% is unchanged.
Interventional UrologyYear-to-date, Coloplast
has seen solid growth above the market, and the company’s financial
performance has been in line with expectations. The key factor
behind the lower organic growth expectations is a revised outlook
for the Interventional Urology business, which represents around
10% of group sales.
As a result of the COVID-19 outbreak, elective surgeries and
procedures are expected to be postponed globally, which will
negatively impact the financial performance of the Interventional
Urology business in the second half of the financial year. The US
represents around 50% of revenues in Interventional Urology and the
negative impact from a decline in elective surgeries and procedures
in the US is expected to be significant. The negative revenue
impact is expected to be temporary and we expect the revenue loss
to be recaptured once the situation normalises.
Ostomy Care, Continence Care and Wound CareOn a
positive note, the situation in China in the Ostomy Care and Wound
Care businesses is gradually normalising. Coloplast is monitoring
the situation closely across all markets and business areas. The
rate of new patients in Ostomy Care, however, is expected to be
negatively impacted until the situation normalises as only the most
acute ostomy surgeries are taking place.
Operating at full capacityColoplast is focused
on adapting our business and commercial activities to the changing
situation, while continuing to service users to the best of the
company’s ability. This includes a prudent focus on costs as the
company navigates this difficult situation. Coloplast’s global
manufacturing sites are operating as normal and in terms of
production and supply chain, the company can fully meet demand.
Coloplast is taking all necessary precautionary measures at the
factories and distribution centres to keep employees safe and
ensure supply including temperature checks of employees and
limiting external guests. Border closures are complicating
deliveries across borders and Coloplast is implementing mitigating
measures to handle the situation. Coloplast is acting globally to
protect all employees and will continue to comply with and support
local, national and global guidelines from healthcare
authorities.
Revised financial guidanceThe situation is
developing rapidly and remains uncertain. The revised full-year
guidance assumes that the situation in Interventional Urology
gradually normalises during the second half of the financial year,
as well as a stable supply and distribution of products across the
company.
Coloplast will continue to monitor and assess the impact to the
business and provide an update in the Interim Financial Report for
H1 2019/20 scheduled to be released on May 6, 2020.
The share buyback programme totalling up to DKK 500 million, as
announced on February 6, 2020, will continue as planned and the
company’s dividend policy is unchanged.
CONTACTSLina DanstrupSenior Media Relations
Manager, Corporate Communications+45 49 11 26
07dklina@coloplast.com
Ellen BjurgertVice President, Investor Relations+45 49 11 33
76dkebj@coloplast.com
- Coloplast revises full-year organic growth and EBIT margin
guidance for 2019_2020
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