WS Audiology delivers solid performance in 2019/20 despite COVID-19
Copenhagen, Denmark – Hearing aid and hearing health service provider WS Audiology today announced its annual results for the period October 1, 2019 to September 30, 2020.
WS Audiology delivered solid performance and financial results in the fiscal year 2019/20 considering the COVID-19 pandemic. The company maintained satisfactory revenue and earnings despite a significant drop of sales during spring as the world closed-down, due to a strong recovery in summer and fall.
- Revenue at EUR 1,738 million (organic growth of -11%)
- Adjusted EBITDA of EUR 331 million (19% margin)
- Strong V-shaped recovery after low-point in April across all business segments
- Recovery supported by two major product launches and diverse business segment portfolio
- Key drivers of performance include Europe, online segment (audibene/Hear.com), managed care in the US and large accounts
- Integration following merger well on track
- Management expects double-digit organic revenue growth for the group for the financial year 2020/21 and an adjusted EBITDA margin above 20%.
“While the events of last year took everyone by surprise, the strong performance and recovery of WS Audiology following the outbreak of COVID-19 and the significant adverse effect in our fiscal third quarter in particular has highlighted the strength of the company, our people and our brands. We took mitigating actions to accelerate synergies and manage costs, while our supply chain has shown resilience. And our ability to deliver existing and new products through many different sales channels has also contributed to the strong recovery,” said WS Audiology CEO Eric Bernard.
WS Audiology maintained a solid earnings level and generated adjusted EBITDA of EUR 331 million corresponding to an adjusted EBITDA margin of 19%. Profitability was safeguarded during the period and improved quarter by quarter, except for the COVID-impacted third fiscal quarter, by acceleration of the synergy program and diligent cost management.
Net results ended at EUR -243 million, driven by planned merger-related costs, higher net financial expenses and the impact from COVID-19.
“COVID-19 will not go away quickly and will have a continued effect on the global economy through 2021. However, we believe we are uniquely positioned to grasp new opportunities in the hearing aid market with our truly differentiated brands and diverse assets across wholesale, retail, online channel, managed care and innovative diagnostic solutions. This is confirmed by a strong sales and earnings performance in the first quarter of the new fiscal year, and we expect to continue the progress,” said Eric Bernard.WS Audiology expects to generate double-digit organic growth and improve the adjusted EBITDA margin to above 20% in 2020/21. However, it should be noted that market uncertainty remains higher than normal due to the ongoing pandemic.
Selected key figures and financial ratios
|EURm||2019/20(12 months)||2018/19(17 months)|
|R&D costs expensed||84||84|
|Adjusted EBITDA margin, %||19%||19%|
|Depreciation and amortisation||317||183|
|Operating (loss)/profit (EBIT)||(116)||(79)|
|Net financial items||(183)||(220)|
|(Loss)/profit for the year/period||(243)||(285)|
Guidance metrics in bold. The consolidated financial statements for 2018/19 covered 17 months from 1 May 2018 to 30 September 2019 for the Widex Group and includes the financials for the Sivantos Group from closing of the merger, i.e. 1 March 2019 to 30 September 2019 (7 months).
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Formed in 2019, through the merger of Sivantos and Widex, WS Audiology combines over 140 years’ experience in pioneering the use of technology to help people with hearing loss hear the sounds that make life wonderful. We are active in over 125 markets and employ more than 11,000 people worldwide. Our broad portfolio of leading hearing related products and services generates annual revenues of around EUR 1.7 billion. WS Audiology is privately owned by the Tøpholm and Westermann families, as well as funds under the management of EQT. As a global leader, our ambition is to unlock human potential by making wonderful sound part of everyone’s life.