2022 Highlights
- GN delivered
DKK 18.7 billion revenue with organic revenue growth of -3% - Adj. EBITA of
DKK 2.2 billion - Intention to initiate a fully underwritten rights issue with gross proceeds of
DKK 7 billion in order to accelerate deleveraging to 1-2x NIBD/EBITDA in the short-term
GN Hearing had a very strong finish to the year with 14% organic revenue growth in Q4 2022 driven by significant market share gains as a result of the successful ReSound OMNIA launch. Consequently, GN Hearing delivered 5% organic revenue growth in 2022, in line with the financial guidance. Revenue growth was 17% including around 7% impact from the development in foreign exchange rates and around 5% impact from M&A. The Emerging business (JabraEnhance.com) delivered 73% organic revenue growth. The revenue in 2022 reached
GN Audio executed strongly in the Enterprise business in Q4 2022 with 9% organic revenue growth. Consequently in 2022, the Enterprise business matched the all-time high revenue from 2021 despite significant market challenges. The strong performance resulted in market share gains due to a world-leading product portfolio and solid channel execution. In spite of supply chain challenges and soft market conditions SteelSeries increased their revenues quarter by quarter, and ended with a strong finish, delivering organic revenue growth of -4% in Q4 2022, resulting in market share gains. The Consumer business was challenged by reduced consumer sentiment and significant promotions, which resulted in organic revenue growth of -37% for 2022. As a result, GN Audio delivered -7% organic revenue growth in 2022, in line with the updated financial guidance. The revenue in 2022 reached
The acquisitions of Lively – now rebranded JabraEnhance.com – and SteelSeries are strategically important to GN Hearing and GN Audio, both doing very well in their market segments and present significant growth opportunities. The decision on how to fund the SteelSeries acquisition was taken in
Multiple external factors presented GN with significant headwinds throughout 2022: War in
In accordance with our announcement on
Proceeds from the Rights Offering will be used to strengthen GN’s balance sheet and provide appropriate financial flexibility. With these actions we are confirming our commitment to the capital structure policy with a target of 1-2x NIBD/EBITDA, which we plan to reach in the short term.
GN has entered into a standby underwriting letter and, as such, the Rights Offering is, subject to certain customary conditions, fully underwritten by a syndicate of banks. In connection with the Annual General Meeting on
Financial highlights Q4 2022
GN Store Nord delivered revenue ofDKK 5.3 billion in Q4 2022 and an organic revenue growth of 3%. Adj. EBITA wasDKK 744 million , equal to a growth of 14% compared to Q4 2021- GN Hearing delivered a very strong 14% organic revenue growth in Q4 2022 driven by significant market share gains as a result of the successful ReSound OMNIA launch. Adj. EBITA was
DKK 503 million in the core business, equal to an EBITA margin of 28.9%, reflecting strong operating leverage. The Emerging business delivered an EBITA ofDKK -31 million - GN Audio delivered -3% organic revenue growth in Q4 2022 driven by 9% organic revenue growth in Enterprise but offset by -38% organic revenue growth in Consumer. SteelSeries delivered a strong finish to the year leading to an organic growth of -4% in Q4 2022 in a soft market. Adj. EBITA ended at
DKK 334 million in Q4 2022
Financial highlights Q4 2022
GN Hearing | GN Audio | |||||
DKK million | GN Hearing | Core business | Emerging business | GN Audio | GN Audio organic | Steel- Series |
Revenue | 1,807 | 1,742 | 65 | 3,463 | 2,679 | 784 |
Organic growth | 14% | 14% | 77% | -3% | -3% | -4% |
Adj. EBITA** | 472 | 503 | -31 | 334 | ||
Adj. EBITA margin** | 26.1% | 28.9% | 9.6% |
Group total* | GN Hearing | GN Audio | |||||||
DKK million | Q4 2022 | Q4 2021 | Growth | Q4 2022 | Q4 2021 | Growth | Q4 2022 | Q4 2021 | Growth |
Revenue | 5,270 | 4,100 | 29% | 1,807 | 1,429 | 26% | 3,463 | 2,671 | 30% |
Organic growth | 3% | -2% | 14% | 2% | -3% | -4% | |||
Adj. Gross profit** | 2,581 | 2,224 | 16% | 1,205 | 908 | 33% | 1,376 | 1,316 | 5% |
Adj. Gross profit margin** | 49.0% | 54.2% | -5.2%p | 66.7% | 63.5% | 3.2%p | 39.7% | 49.3% | -9.6%p |
Adj. EBITA** | 744 | 651 | 14% | 472 | 219 | 116% | 334 | 475 | -30% |
Adj. EBITA margin** | 14.1% | 15.9% | -1.8%p | 26.1% | 15.3% | 10.8%p | 9.6% | 17.8% | -8.2%p |
Adj. Earnings per share (EPS)*** | 3.92 | 4.14 | -5% | ||||||
Free cash flow excl. M&A | -105 | -279 | NA | 64 | -61 | NA | -21 | 198 | NA |
* Including “Other”
** Excluding non-recurring items (
*** Excluding non-recurring items (
Financial highlights 2022
GN Hearing | GN Audio | |||||
DKK million | GN Hearing | Core business | Emerging business | GN Audio | GN Audio organic | Steel-Series |
Revenue | 6,227 | 6,022 | 205 | 12,460 | 10,143 | 2,317 |
Organic growth | 5% | 5% | 73% | -7% | -7% | -19% |
Adj. EBITA** | 599 | 786 | -187 | 1,759 | ||
Adj. EBITA margin** | 9.6% | 13.1% | 14.1% |
GN Hearing | GN Audio | ||||||||
DKK million | 2022 | 2021 | Growth | 2022 | 2021 | Growth | 2022 | 2021 | Growth |
Revenue | 18,687 | 15,775 | 18% | 6,227 | 5,332 | 17% | 12,460 | 10,443 | 19% |
Organic growth | -3% | 20% | 5% | 16% | -7% | 22% | |||
Adj. Gross profit** | 9,384 | 8,682 | 8% | 3,963 | 3,400 | 17% | 5,421 | 5,282 | 3% |
Adj. Gross profit margin** | 50.2% | 55.0% | -4.8%p | 63.6% | 63.8% | -0.2%p | 43.5% | 50.6% | -7.1%p |
Adj. EBITA** | 2,166 | 2,664 | -19% | 599 | 643 | -7% | 1,759 | 2,209 | -20% |
EBITA margin** | 11.6% | 16.9% | -5.3%p | 9.6% | 12.1% | -2.5%p | 14.1% | 21.2% | -7.1%p |
Adj. Earnings per share (EPS)*** | 10.54 | 15.29 | -31% | ||||||
Free cash flow excl. M&A | -1,291 | 702 | NA | -377 | 198 | NA | -91 | 1,288 | NA |
* Including “Other”
** Excluding non-recurring items (
*** Excluding non-recurring items (
Shareholder returns – dividend and share buybacks
In 2022, GN distributed
As a consequence of the concluded capital structure review, GN will not pay a dividend in respect of the fiscal year 2022. As GN’s capital structure policy is confirmed, GN expects to return to making dividend payments, once the leverage is back within the long-term target.
Financial guidance for 2023
GN Hearing
In 2023, GN Hearing expects to continue to grow faster than the projected market growth. Due to the current macroeconomic environment, GN Hearing is projecting 1-3% market volume growth and -1% to -2% market ASP decline. It is currently expected that market growth will be higher in H2 2023 compared to H1 2023. Due to GN Hearing’s current momentum and competitive product portfolio, an organic revenue growth between 2% to 8% driven by market share gains is expected for 2023.
Non-recurring items primarily relates to investments in the supply chain in the magnitude of DKK ~ -150 million is expected in 2023 in order to restore profitability. For the core hearing aid business, the EBITA margin is expected to be between 13% to 16% for 2023 excluding non-recurring items. In the Emerging Business (including JabraEnhance.com (formerly Lively) and further investments into the digital space), GN Hearing will continue to invest, and with the expected strong topline growth, the EBITA impact for 2023 is expected to be DKK ~ -150 million.
The GN Hearing financial guidance is based on the following assumptions for Q1 2023:
- Revenue: Q1 2023 organic revenue growth is assumed to be within the 2-8% guidance
- EBITA: Q1 2023 EBITA margin assumed to be mid-single digit (excluding non-recurring items) due to seasonality and launch costs. The EBITA margin is expected to improve in H2 2023 due to operating leverage
GN Audio
In 2023, GN Audio expects to continue to grow faster than the market. The uncertainties arising from the current macroeconomic environment are expected to negatively impact the market growth. GN Audio is expecting organic revenue growth between -10% to +5%. The EBITA margin is expected to be 10% to 15% for 2023 excluding non-recurring items. This reflects an expectation of gaining market share in a challenging market environment and continued cost prudence.
In order to further reduce the cost base GN Audio is expecting non-recurring items of
DKK ~ -150 million in 2023 in relation to cost reduction measures.
The GN Audio financial guidance is based on the following assumptions for Q1 2023:
- Revenue: Q1 2023 organic revenue growth is assumed to be negative, due to challenged market conditions
- EBITA: Q1 2023 EBITA margin assumed to be mid-single digit (excluding non-recurring items) due to the topline development and investment in growth opportunities. The EBITA margin is expected to improve in H2 2023 due to improvement in operating leverage
For full year 2023,
Financial guidance 2023
Organic revenue growth | Adjusted EBITA margin2) | Non-recurring items (DKK million) | |
GN Hearing | 2% to 8% | ||
- Core business | 13% to 16% | ~ -150 | |
- Emerging Business1) (DKK million) | ~ -150 | ||
GN Audio | -10% to +5% | 10% to 15% | ~ -150 |
Other (DKK million) | ~ -200 | ||
-6% to +6% | ~ -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
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.
Quotes from Executive Management
Teleconference
For further information, please contact:
Investor Relations
Anne Sofie Staunsbæk Veyhe +45 45 75 85 06
Media Relations
Forward-looking statements
The 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 securities offered will not be and have not been registered under the
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.
About GN
GN facilitates communication between people through intelligent hearing, audio, video, and gaming technology. Inspired by people and driven by our passion for innovation, we leverage technologies to deliver unique user experiences that bring people closer through the power of sound and vision.
GN was founded more than 150 years ago with a vision to connect the world. Today, we proudly honor that legacy with our world-leading expertise in the human ear, audio, video and speech, wireless technologies, software, miniaturization, and collaboration with leading technology partners. GN's solutions are marketed by the brands ReSound, SteelSeries, Jabra, Beltone, Interton, BlueParrott, Danavox and FalCom in 100 countries. Founded in 1869, the
Visit our homepage GN.com - and connect with us on LinkedIn, Facebook and
Attachments
- GN Annual Report 2022
- GNStoreNord-2022-12-31
© OMX, source