Continued earnings improvement, however, pressure on European growth

Coloplast: In the first quarter of 2011/12 revenue increased by 4% to DKK 2,654m and the EBIT margin was 26% against 24% in the same period of last year. The gross profit increased by 8% to DKK 1,738m which gives a gross margin of 65% against 63% in Q1 2010/11.

Read the announcement: English Danish

“I’m satisfied with the continued earnings improvement.” says CEO Lars Rasmussen.

“However, growth in Europe is not satisfactory. Almost 75% of our sales are effected here and in the first quarter we experienced lower growth rates than witnessed before. Especially, the development in Spain and France was disappointing.”

Return on invested capital before tax (ROIC) was 32% against 27% in the same period of last year.

Within the business areas growth was 7% in Ostomy Care, 5% in Continence Care and 5% in Urology Care whereas growth within Wound & Skin Care products was negative by 3% compared to last year.

 

Positive development in Ostomy Care

“Development in Ostomy Care was positive and especially Russia contributed to growth. I’m also quite pleased with the development in the US which continued as planned and showed improved growth rates.”

“In the relatively small Wound Care business area development was not satisfactory. This was especially due to Greece where we have reduced stocks at our distributor in order to decrease the risk of loss. At the same time, however, we saw a positive development in Germany and the United Kingdom which both generated positive growth in the quarter.”

 

Financial guidance for 2011/12

Revenue growth of about 6% is expected organically and about 8% in DKK. An EBIT margin of about 27% is expected at constant exchange rates and about 28% in DKK.

 

Share buy-back

In December 2011, the shareholders in general meeting authorised Coloplast to establish a share buy-back programme totalling up to DKK 1bn until the end of the 2012/13 financial year. The first part of the share buy-back programme is expected to be launched in the second quarter and completed no later than 30 September 2012