Demant A/s · OMXCOP:DEMANT
Demant A/s — William Demant Holding — Investor Presentation (March 2004)
20 slides from Demant A/s's investor presentation, March 2004
Slide 1: William Demant Holding A/S Investor Presentation March/April 2004
Annual Report 2003 William Demant Holding A/S Investor Presentation March/April 2004
Slide 2: Headlines 2003
Annual Report 2003 Headlines 2003 • Results in line with expectations • 8% organic growth - 10% growth in core business • Revenues of DKK 3.87 billion - headwind from foreign exchange of 9% • Increase in gross profit ratio to 65.2% • EBIT of DKK 856 million - up from DKK 810 million • Profit margin
Slide 3: Hearing Aids
Annual Report 2003 Hearing Aids • Business area accounted for 89% of revenues • Growth of 9% in local currencies • 14% unit growth in sales of own manufactured hearing aids • Market conditions: – Flat first half - growth in second half – Double-digit growth in Germany and France - pick-up in demand
Slide 4: Completion of digital product portfolio
Annual Report 2003 Completion of digital product portfolio New Premium Family Price/Performance Super Power family: 1999 2000 2001 2002 2003 2004 Launch year
Slide 5: Diagnostic Instruments
Annual Report 2003 Diagnostic Instruments • Business area accounted for 5% of revenues • Market for audiometric equipment declined slightly in 2003 - more sensitive to economic cycles than hearing aids • Rising order inflow in Q4 • Introduction of OtoAcoustic Emission screener and Affinity, a PC- ba
Slide 6: Personal Communication
Annual Report 2003 Personal Communication • This business area, consisting of Phonic Ear and Sennheiser Communications, accounted for 6% of Group revenues • Sluggish markets, management change and out- sourcing of production provided a turbulent year for Phonic Ear • Introduction of Lexis in the US
Slide 7: Profit and loss account
Annual Report 2003 Profit and loss account % change in local DKK million 2002 2003 % change currency Net revenue 3,924 3,870 -1% 8% Gross profit 2,505 2,521 1% 7% Gross profit ratio 63.9% 65.2% Research and development costs -272 -295 8% 11% Distribution costs -1,160 -1,130 -3% 7% Administrative exp
Slide 8: Net revenue by business area
Annual Report 2003 Net revenue by business area 5% 6% 89% % change in local DKK million 2002* 2002** 2003** currency Hearing Aids 3,429 3,135 3,424 9% Diagnostic Instruments 240 227 211 -7% Personal Communication 255 225 235 4% Total 3,924 3,587 3,870 8% * Computed at 2002 exchange rates ** Computed
Slide 9: Net revenue by region
Annual Report 2003 Net revenue by region 8% 3% 6% 47% 36% % change for % change in Hearing Aids local in local DKK million 2002* 2002** 2003** currency currency Europe 1,722 1,671 1,819 9% 10% North America 1,524 1,270 1,384 9% 11% Asia 243 224 240 7% 8% Pacific Rim 320 320 302 -6% -6% Other countri
Slide 10: Currency impact
Annual Report 2003 Currency impact 1.400 Rates vs. DKK • Negative impact on revenues of 9% 1.200 1182 • USD weakened more than 30% 1075 1076 since January 2002 1.000 • Impact on earnings delayed due to hedging of transaction- related effect - major trading 789 800 currencies hedged 6-24 659 months 5
Slide 11: Research & Development
Annual Report 2003 Research & Development DKK million R: 17 % 295 CAG 272 253 198 159 1999 2000 2001 2002 2003
Slide 12: Operating profit (EBIT)
Annual Report 2003 Operating profit (EBIT) DKK million 856 : 2 6% 810 G R CA 683 583 336 1999 2000 2001 2002 2003
Slide 13: Earnings per share
Annual Report 2003 Earnings per share DKK % 8,8 R: 26 G 7,9 CA 6,5 5,8 3,5 1999 2000 2001 2002 2003
Slide 14: Ongoing performance enhancement
Annual Report 2003 Ongoing performance enhancement • Phonic Ear, USA: Close-down of production • Bernafon: – Close-down of Minneapolis facility - move to New Jersey – Re-organization of Australian activities to future without Australian Government contract • Interacoustics, Denmark: Up-grade of prod
Slide 15: Cash flows
Annual Report 2003 Cash flows DKK million 2000 2001 2002 2003 Net profit for the year 426 481 579 618 CFFO 316 317 669 754 CFFI, excl. acquisitions -116 -184 -120 -138 Free cash flow 200 133 549 616 Acquisitions -773 -477 -7 0 Buy-back of shares -21 -27 -423 -541 Other financing activities 257 524 -
Slide 16: Cash conversion
Annual Report 2003 Cash conversion 700 618 579 600 481 426 500 400 257 300 200 100 0 1999 2000 2001 2002 2003 Net profit for the year (DKK million) Free cash flow (DKK million)
Slide 17: Balance sheet
Annual Report 2003 Balance sheet DKK million 2002 2003 2002 2003 Assets Liabilities Intangible 11 13 Shareholders' equity 428 522 Tangible 430 439 Provisions 43 65 Financial 78 99 Long-term creditors 711 541 Total fixed assets 519 551 Short-term creditors 810 887 Inventories 614 573 Total creditors
Slide 18: Shareholder information
Annual Report 2003 Shareholder information • Dividends through share buy-back - net flow of DKK 1.1 billion to shareholders since listing in 1995 • At 3 March 2004, the Company holds 3.5% of issued shares - shares to be cancelled at AGM • Main shareholder, the Oticon Foundation, holds 61% of shares
Slide 19: Guidance - 2004
Annual Report 2003 Guidance - 2004 • Organic growth of 7-10% • Revenues of DKK 4.0 billion (at January currency rates - negative impact of 4% compared to realised rates 2003) • Core business to grow faster than other activities • Growth in EBIT despite centenary celebration costs of DKK 30 million a
Slide 20: www.demant.com
Annual Report 2003 www.demant.com
William Demant Holding — Investor Presentation (March 2004) on 6ix