Interim Report Q3 2015


Copenhagen, 2015-10-30 07:30 CET (GLOBE NEWSWIRE) -- Solid organic revenue growth and cash generation

  • GN Store Nord reported organic growth of 8% in Q3 2015 driven by continued strong growth in GN ReSound and a recovery in GN Netcom, as projected. The cash conversion ended at 55% with solid cash generation in both divisions
  • In Q3 2015, GN ReSound again grew much faster than the global hearing aid market with 6% organic growth in GN ReSound and 7% organic growth in Hearing Instruments. This is despite the comparison base being impacted by the accounting fraud in the Beltone distribution network in 2012 – 2014. Growth continued to be driven by ReSound LiNX2™ – the fourth generation hearing aid with 2.4 GHz technology. EBITA increased by 6% in constant currencies in Q3 2015 and reached DKK 237 million  
  • GN ReSound delivered solid cash conversion of 64% in Q3 2015. During the first nine months of 2015, cash conversion is 53% or almost double up compared to the same period of 2014
  • At the end of Q3 2015, GN ReSound launched ReSound Enya™ in the essential price segment, which makes GN ReSound’s industry-leading technologies accessible for even more people with hearing loss. Furthermore, in October 2015, GN ReSound announced the Smart Hearing Alliance with Cochlear to develop and commercialize the world’s smartest bimodal hearing solutions
  • GN Netcom returned to double digit organic growth in Q3 2015. Organic growth was 11% driven by 23% organic growth in the UC headset segment. Mobile grew 12% organically with significant growth in the Sports Audio segment. EBITA was up 12% in constant currencies to DKK 113 million
  • The cash conversion in GN Netcom was 63% in Q3 2015, reflecting among others a positive development in trade receivables
  • GN Netcom announced several new innovative products in Q3 2015. The new Jabra Speak 810™ expands the speaker portfolio into medium size meeting rooms, whereas the new Jabra Sport Pace™ Wireless product completes the full line up in Sports Audio
  • Based on continued strong business performance and GN’s capital structure policy, a share buyback program of DKK 500 million is initiated today, succeeding the program expired October 29, 2015
  • The investigations regarding the accounting fraud committed by the former VP of Finance in the Beltone distribution network have now been finalized. The investigations confirm what was communicated in the Interim Report Q2 2015 and the write-downs already made in Q2 are adequate  

Updated guidance 2015

  • Full year organic growth and EBITA guidance are maintained for GN ReSound
  • Full year organic growth and EBITA guidance are maintained for GN Netcom with growth likely ending in the low end of the 3 – 5% organic growth range
  • Following the decision by the German Federal Supreme Court, the EBITA guidance for 2015 for “Other” is updated from around DKK (60) million to around DKK (75) million reflecting that GN is liable for legal fees, including a court fee, of approximately EUR 2 million
  • GN Store Nord’s full year organic growth guidance is maintained with growth likely ending in the low end of the 6 – 7% organic growth range. Following the updated guidance for “Other”, GN Store Nord’s full year EBITA guidance is adjusted from around DKK 1,480 million to around DKK 1,465 million
  • The guidance for Financial Items, Amortization etc. is updated from DKK (325) million to DKK (350) million. The increase mainly reflects foreign exchange adjustment of certain balance sheet items

Quotes from the executive management

Anders Hedegaard, CEO of GN ReSound: “The third quarter clearly demonstrates GN ReSound’s great momentum. Adjusting for the accounting fraud last year in the Beltone distribution network, I am really pleased to see the strong growth in our hearing instrument business. During the third quarter, we saw continued strong performance by ReSound LiNX2, and we received recognition worldwide by users highlighting the unique sound experience of ReSound LiNX2 among others because of Spatial Sense, providing a natural sense of where sounds are coming from. And with the launch of ReSound Enya, our 2.4 GHz technology is now for the first time available across all form factors and price points.”

René Svendsen-Tune, CEO of GN Netcom: “After two challenging quarters, I am pleased that GN Netcom in Q3 2015 delivered solid organic growth, as we projected. During the temporary market headwinds in first half of 2015, the organization stayed focused on execution of our “INNOVATION & GROWTH” strategy. I am very pleased to see that our innovation machine is running at full steam, and that we have once again been able to successfully launch very attractive and relevant products into both the professional and consumer markets.”

Teleconference
GN will host a teleconference at 2.00 pm CET today. Please visit www.gn.com/investor to access the teleconference. Presentation material will be available on the website approximately one hour prior to the start of the teleconference.

For further information please contact:

Peter Justesen
VP – Investor Relations & Treasury
GN Store Nord A/S
Tel: +45 45 75 87 16

or

Michael Nass Nielsen
Manager – Investor Relations
GN Store Nord A/S
Tel: +45 45 75 02 40

 

 


Attachments

GNSN-Interim_Report_Q3_ 2015.pdf