Demant As Stock Earnings Reports

Demant reported 2025 results with modest group-level organic growth (2% for the year; 4% in H2) and earnings pressure from mix and currency effects. Hearing Care (including the December acquisition of KIND Group) is now the largest business area and delivered solid performance, while Hearing Aids and Diagnostics grew more slowly for the year but improved in Q4. Management highlighted the successful initial rollout of Oticon Zeal (an in‑ear premium product) generating strong professional and end‑user feedback and the potential to drive market share gains, particularly as the product is rolled out more broadly through 2026. Financials: gross profit increased slightly but gross margin contracted due to geography/channel mix (lower ASPs) and some Diagnostics headwinds; EBIT before special items fell ~10% in H2 to DKK 2.1bn and full‑year EBIT before special items was DKK 3.96bn. Free cash flow remained strong (~DKK 2bn in H2; >DKK 3bn for the year) but net debt rose materially after the KIND acquisition, pushing gearing to ~3.4% (above the 2.0–2.5% target). Management expects to prioritize deleveraging and pause share buybacks in 2026. Outlook for 2026: organic growth 3–6% and EBIT before special items DKK 4.1–4.5bn, underpinned by an assumed global hearing-aid market growth of 2–4%, an expected ~DKK 300m EBIT contribution from KIND (11 months), and DKK 250m of EBIT improvement in 2026 from a company-wide profitability program (with ~DKK 500m annualized savings from 2028). The restructuring/program will incur one‑off special items (~DKK 325m in total for 2026–27) and affect ~700 roles globally. Management is cautious on FX (expecting ~DKK 200m negative EBIT impact in 2026) and has phased product launches and cost actions to improve profitability while continuing to invest in R&D and clinic expansion.