GN Store Nord delivered 7% organic revenue growth driven by strong market share gains. Full year guidance upgraded
27 April 2023 - 4:12AM
GN Store Nord delivered 7% organic revenue growth driven by strong
market share gains. Full year guidance upgraded
- - GN Store Nord
- GN delivered 9% revenue growth, of which 7% was organic revenue
growth, leading to revenue of DKK 4,214 million reflecting strong
execution in challenging market conditions
- Adj. EBITA was DKK 251 million and free cash flow excl. M&A
was DKK -578 million driven by non-recurring items as well as
seasonality in cash flow due to, among other, payment of corporate
tax
- New financing plan will be announced in the short-term with the
aim to clear the 2024 and 2025 debt maturities
- The financial guidance on organic revenue growth is upgraded
from “-6% to +6%” to “-5% to +7%” following a stronger than
expected start to the year in GN Hearing
- - GN Hearing
- GN Hearing delivered strong revenue growth of 21%, of which
organic revenue growth was 15%, driven by the launch of the ReSound
OMNIA family resulting in significant market share gains
- Adj. EBITA margin was 9.9% in the Core business driven by
traditional seasonality with lower absolute revenue as well as
investments in launch activities to fuel the strong momentum of
ReSound OMNIA.
- The Emerging business delivered strong organic revenue growth
of 46% and EBITA of DKK -41 million, driven by continued
investments in growth
- Free cash flow excl. M&A was DKK -132 million due to
traditional seasonality including payment of corporate tax
- Following a stronger than expected start to the year, GN
Hearing is upgrading its organic revenue growth guidance from “2%
to 8%” to “5% to 10%”. At the same time, the adj. EBITA margin in
the core business is upgraded from “13% to 16%” to “14% to
16%”
- - GN Audio
- GN Audio delivered revenue growth of 3%, of which organic
revenue growth was 2%, driven by continued strong market share
gains despite challenging market conditions. Organic revenue growth
was driven by 22% growth in SteelSeries and 9% growth in Consumer,
partly offset by a 3% decline in Enterprise
- Adj. EBITA margin was 7.0%, negatively impacted by FX, business
mix and promotional activities in the consumer-oriented businesses
to reduce inventories in line with the rest of the industry
- Free cash flow excl. M&A was DKK -304 million reflecting
the earnings level and traditional seasonality including payment of
corporate tax, but partly offset by reduction in inventories
- Full year guidance confirmed
Quotes from executive managementGitte Aabo, CEO of GN
Hearing, comments: “We are very pleased to see the great momentum
from Q4 2022 continue into 2023 with 15% organic revenue growth
delivered in Q1. Our strong performance is broad based across
regions, and with our new full product line-up of popular styles in
the very successful ReSound OMNIA family, our growth platform is in
place, boding well for the remainder of the year, why we are also
confident in upgrading the guidance for our full-year.”
Peter Karlstromer, CEO of GN Audio, comments: “As expected, we
continued to face challenging market conditions in Q1. In this
environment our teams have executed strongly resulting in market
share gains, and consequently all three business lines delivered
organic revenue growth above our expectations. I’m especially
pleased to see SteelSeries continuing to outperform the market
growing 22%, showcasing the strength of our premium gaming
portfolio. To further strengthen the resilience of GN Audio and
weather the challenging market conditions, we executed a series of
cost reduction initiatives during Q1 to protect our margins and
improve future cash flow.”
Financial overview Q1 2023
|
GN Hearing |
GN Audio |
|
DKK million – Q1 2023 |
Core |
Emerging |
GN Hearing |
Enterprise |
Consumer |
SteelSeries |
GN Audio |
Revenue |
1,560 |
62 |
1,622 |
1,767 |
285 |
540 |
2,592 |
Organic growth |
14% |
46% |
15% |
-3% |
9% |
22% |
2% |
Adj. EBITA** |
154 |
-41 |
113 |
|
|
|
181 |
|
Adj. EBITA margin ** |
9.9% |
|
7.0% |
|
|
|
7.0% |
|
|
|
|
|
|
|
|
|
|
|
|
|
GN Store Nord* |
GN Hearing |
GN Audio |
|
DKK million |
Q1 2023 |
Q1 2022 |
Growth |
Q1 2023 |
Q1 2022 |
Growth |
Q1 2023 |
Q1 2022 |
Growth |
|
Revenue |
4,214 |
3,859 |
9% |
1,622 |
1,337 |
21% |
2,592 |
2,522 |
3% |
|
Organic growth |
7% |
-21% |
|
15% |
2% |
|
2% |
-30% |
|
|
Adj. Gross profit** |
2,058 |
1,952 |
5% |
996 |
804 |
24% |
1,062 |
1,148 |
-7% |
|
Adj. Gross profit margin** |
48.8% |
50.6% |
-1.8%p |
61.4% |
60.1% |
1.3%p |
41.0% |
45.5% |
-4.5%p |
|
Adj. EBITA** |
251 |
264 |
-5% |
113 |
-41 |
NA |
181 |
364 |
NA |
|
Adj. EBITA margin** |
6.0% |
6.8% |
-0.8%p |
7.0% |
-3.1% |
10.1%p |
7.0% |
14.4% |
-7.4%p |
|
Non-recurring items |
-78 |
-266 |
|
-60 |
-29 |
|
-18 |
-219 |
|
|
Adj. Earnings per share (EPS)*** |
0.66 |
0.77 |
-15% |
|
|
|
|
|
|
|
Free cash flow excl. M&A |
-578 |
-557 |
-21 |
-132 |
-175 |
43 |
-304 |
-140 |
-164 |
|
* Including "Other", ** Excluding non-recurring items (DKK -18
million in OPEX in GN Audio, DKK -17 million in COGS in GN Hearing
and DKK -43 million in OPEX in GN Hearing), *** Excluding
non-recurring items (DKK -78 million OPEX and COGS) and
amortization of acquired intangible assets
Financial guidance 2023 is upgraded
|
Organic revenue growth |
Adjusted EBITA margin2) |
Non-recurring items (DKK million) |
GN Hearing |
5% to 10% |
|
|
- Core business |
|
14% to 16% |
~ -150 |
- Emerging Business1) (DKK million) |
|
~ -150 |
|
GN Audio |
-10% to +5% |
10% to 15% |
~ -150 |
Other (DKK million) |
|
~ -200 |
|
GN Store Nord |
-5% to +10% |
|
~ -300 |
Note 1) Emerging Business mainly includes the JabraEnhance.com
(formerly Lively)Note 2) Excluding non-recurring items Based on
foreign exchange rates as of April 26, 2023
Primary risk factors in relation to the financial guidance
The basic assumptions behind the guidance remain more uncertain
than normal. Primary risk factors include inflationary pressures,
consumer sentiment and general economic uncertainty. GN’s supply
chains, including component sourcing and local and geopolitical
instability and deteriorating trade relations may impact key
suppliers and GN’s operations.
TeleconferenceGN Store Nord will host a teleconference at
11.00 a.m. CEST on April 27, 2023. Please visit www.gn.com/investor
to access the teleconference. Presentation material will be
available on the website prior to the start of the
teleconference.
For further information, please contact:
Investor RelationsAnne Sofie Staunsbæk Veyhe +45 45 75 85
06Rune Sandager +45 45 75 92 57 Media Relations Steen Frentz
Laursen +45 20 65 34 20
Forward-looking statementsThe forward-looking statements
in this report reflect the management's current expectations of
certain future events and financial results. Statements regarding
the future are, naturally, subject to risks and uncertainties,
which may result in considerable deviations from the outlook set
forth. Furthermore, some of these expectations are based on
assumptions regarding future events, which may prove incorrect.
Changes to such expectation and assumptions will not be disclosed
on an ongoing basis, unless required pursuant to general disclosure
obligations to which GN is subject.
Factors that may cause actual results to deviate materially from
expectations include – but are not limited to – general economic
developments and developments in the financial markets,
technological developments, changes and amendments to legislation
and regulations governing GN’s markets, changes in the demand for
GN's products, competition, fluctuations in sub-contractor supplies
and developments in ongoing litigation (including but not limited
to class action and patent infringement litigation in the United
States).
The securities offered will not be and have not been registered
under the U.S. Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration requirements
For more information, see the "Management's report" and "Risk
management” elsewhere in this Annual Report. This Annual Report
should not be considered an offer to sell securities in GN.
The information on the upgraded guidance constitutes inside
information.
About GN
GN brings people closer through our leading intelligent hearing,
audio, video, and gaming solutions. Inspired by people and driven
by innovation, we deliver technology that enhance the senses of
hearing and sight. We help people with hearing loss overcome
real-life challenges, improve communication and collaboration for
businesses, and provide great experiences for audio and gaming
enthusiasts.
GN was founded more than 150 years ago with a vision to connect
the world. Today, inspired by our strong heritage, GN touches more
lives than ever with our unique expertise and the broadest
portfolio of products and services in our history – bringing people
closer to what is important to them.
We market our solutions with the brands Jabra, ReSound,
SteelSeries, Beltone, Interton, BlueParrott, Danavox, and FalCom in
100 countries. Founded in 1869, GN Group employs more than 7,500
people and is listed on Nasdaq Copenhagen (GN.CO).
Visit our homepage GN.com and connect with us on
LinkedIn, Facebook, and Twitter.
- GN Interim report Q1 2023 cover note
- GN Interim Report Q1 2023
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