This article first appeared on GuruFocus .
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Organic Revenue Growth:6% for full year 2025-'26; reported revenue up ~4% (DKK1.1 billion) to DKK28.7 billion implied; FX headwind of DKK472 million (~2 percentage points).
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EBIT (Constant Currencies, Before Special Items):Up 4%; reported EBIT down 3% to DKK7.4 billion.
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EBIT Margin (Before Special Items):26% vs. 28% last year; ~100 bps negative impact from Kerecis.
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Gross Profit / Gross Margin:DKK19.2 billion; gross margin 67% vs. 68% last year; ~100 bps FX headwind plus Costa Rica and Portugal ramp-up costs.
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Operating Expenses:DKK11.8 billion, up 5%; distribution-to-sales ratio 33% (flat); R&D-to-sales ratio 4% vs. 3% (R&D spend up 13%).
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Net Profit (Before Special Items):DKK5.6 billion, up DKK418 million adjusted; adjusted diluted EPS before special items up 8%.
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Special Items:DKK3.2 billion, of which DKK3 billion Kerecis impairment loss.
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Operating Cash Flow:DKK8 billion inflow vs. DKK6.6 billion last year; working capital 24% of sales.
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Free Cash Flow:DKK6.3 billion inflow vs. DKK5.4 billion, up 16% (up 23% excluding acquisition/divestment effects); FCF-to-sales 22% vs. 19%; cash conversion 98%.
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CapEx:5% of sales, including new Portugal manufacturing site.
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Return on Invested Capital:15%, in line with last year's adjusted level.
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Ostomy Care:5% growth for the year, 6% in Q4; 7% excluding China; US market share ~20%.
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Continence Care:7% growth for the year, 5% in Q4; double-digit US growth led by Comfort Medical.
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Voice & Respiratory Care:8% organic growth for the year, 9% in Q4, driven by Laryngectomy.
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Wound & Tissue Repair:2% growth for the year, 1% in Q4; Advanced Wound Dressings up 9% in Q4; Biologics down 12%; ~85% of US biologics sales from inpatient, 15% outpatient.
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Interventional Urology:7% growth for both the year and Q4, driven by US Men's Health.
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Funding the Journey Program:~DKK500 million identified; ~75% of impact expected in '26-'27, full effect in '27-'28.
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FY2026-'27 Guidance:Organic growth 5%-7%; reported revenue growth 7%-9% (~2 pp FX tailwind); EBIT margin ~25% (up to 50 bps FX tailwind); ROIC ~16%; special items ~DKK200 million; CapEx ~5% of sales; tax rate ~22%; net financials ~DKK900 million.
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2030 Ambition:Organic growth 5%-7% per year; EBIT margin in mid-20s (constant currencies); ROIC ~20% in 2029-'30.
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Capital Allocation:Dividend payout ratio target 60%-80%; leverage target below 2x EBITDA.
Release Date: November 03, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Coloplast AS ( CLPBF ) delivered 6% organic revenue growth and 4% EBIT growth in constant currencies for FY2025-26, broadly in line with guidance.
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Chronic Care remains strong, representing over 75% of group sales and driving growth, profitability, and cash generation, with continued traction from Luja and SenSura Mio.
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US Chronic Care business delivered double-digit growth, with market share in Ostomy Care increasing to around 20% and strong momentum in the acute channel.
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Interventional Urology grew 7% for the year and Q4, driven by US Men's Health, and the company is preparing for the phased launch of Titan Prime.
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Free cash flow increased 16% to DKK6.3 billion, with a strong cash conversion of 98%, and the company maintains a dividend payout ratio target of 60-80%.
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The Funding the Journey program is expected to free up around DKK500 million, with 75% impact in FY2026-27, supporting investments in innovation and the US.
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Coloplast AS ( CLPBF ) is investing in future growth with a 13% increase in R&D expenditure and plans to launch more than 10 products across all categories in the coming year.
Negative Points
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Coloplast AS ( CLPBF ) revised its 2030 financial ambition downward due to a more challenging external environment, now expecting organic growth of 5-7% per year and an EBIT margin in the mid-20s.
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US outpatient reimbursement changes significantly affected Biologics, leading to a 12% decline in biologics sales and a DKK3 billion impairment loss on Kerecis.
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Pricing pressure from healthcare reforms in France and Germany is expected to impact Chronic Care and Dressings in FY2026-27, with neutral to negative pricing for the remainder of the Impact4 period.
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Inflationary pressure on raw materials and freight is expected to be 3-4% in FY2026-27, negatively impacting gross margin, along with ramp-up costs in Costa Rica and Portugal.
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China operations experienced negative growth due to inventory reduction, increased local competition, and organizational rightsizing, with growth expected to be flattish going forward.
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The competitive bidding program in the US, expected to take effect in January 2028, creates uncertainty and potential margin contraction in that year.
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EBIT margin before special items declined to 26% from 28% last year, reflecting negative impact from Kerecis and currency headwinds.
Q & A Highlights
Q: What areas of conservatism and risk are baked into the updated midterm targets, and what could drive upside to the high end of the 5% to 7% organic growth guide? A: CEO Gavin Wood said the revised 2030 ambition reflects a tougher external environment, including increased pricing pressure from health care reforms, inflation, step-up investments, and headroom for the US competitive bidding program in 2028, plus the Biologics outpatient reimbursement change. He said the company wanted to be prudent but still aims to grow above the market with strong EBIT development and improving ROIC and free cash flow.
Q: How should investors think about the margin trajectory over the medium term, including the impact of competitive bidding in 2028? A: CFO Anders Lonning-Skovgaard said Coloplast expects an EBIT margin around the 2025 level in 2026-'27 and within the mid-20s over the period to 2029-'30, with the estimate including an impact from US competitive bidding from January 2028. He declined to be more specific because the bidding outcome remains highly uncertain, but said the company is comfortable delivering a mid-20s margin over the period.
Q: When will the increased investment in innovation accelerate the launch cadence and benefit the top line? A: CEO Gavin Wood said Coloplast is launching new products across all businesses, including SenSura Mio expansion, new Luja variants including a US-tailored product, Bowel Care and Voice & Respiratory launches, the phased Titan Prime launch in Interventional Urology, and new Biologics products. Their impact is included in the 5% to 7% growth guidance. He said the DKK500 million Funding the Journey program is mainly aimed at investing beyond 2030, with about 80% allocated to step-up investments in innovation, US Chronic Care, selected European and emerging markets, and Interventional Urology launch preparation.
Q: What are the pricing assumptions underpinning the midterm targets, particularly for US competitive bidding, and what costs are associated with the Funding the Journey program? A: CFO Anders Lonning-Skovgaard said Coloplast will not be more specific on competitive bidding because it is highly uncertain, but internal estimates are reflected in the 2029-'30 growth and margin guidance. He said special items related to Funding the Journey are expected at around DKK200 million, with the majority of the program impacting operating expenses before being reallocated to investments.
Q: What are the cost inflation assumptions for 2026-'27, including raw materials, freight, wages in Hungary, and energy? A: CFO Anders Lonning-Skovgaard said raw material and freight prices are expected to increase 3% to 4%. Hungary wage inflation is assumed at a high single-digit increase starting January 2027. On energy, more than 80% of Hungarian consumption is hedged, and the absolute energy cost level is expected to be similar to 2025-'26.
Q: What drove the significant sequential increase in non-allocated costs in Q4, and what is the invested capital assumption behind the around 20% ROIC target? A: CFO Anders Lonning-Skovgaard attributed the Q4 increase in non-allocated costs to higher cost of goods, increased raw material prices, and additional activity costs including R&D. On ROIC, he said invested capital is expected to be broadly flat over the period, with earnings improvement driving ROIC to around 20% in 2029-'30.
Q: What was the impact of inflation and FX on the Q4 EBIT margin, and how much pricing pressure is expected from health care reforms in France and Germany in 2027? A: CFO Anders Lonning-Skovgaard said FX had a significant negative impact of around 150 basis points on the Q4 margin, mainly from the Hungarian forint and Costa Rican colon, alongside ramp-up costs in Costa Rica and Portugal and a negative mix from Biologics. Raw material and freight impacts were smaller in Q4. For 2026-'27, he expects a low single-digit pricing impact in France and Germany starting January 1, 2027.
Q: Should the low end of the 5% to 7% growth range be the base case, and what are the key swing factors? A: CEO Gavin Wood said key swing factors include the Biologics growth trajectory, with a slow start to 2026-'27 until the outpatient reimbursement change annualizes at the beginning of Q2; the level of pricing pressure in any given year; and US Chronic Care execution, where around double-digit growth is expected but competitive bidding must be prepared for. He said Chronic Care remains intact, the US is growing double digits, Europe and emerging markets outside China are strong, China should stabilize after inventory reduction and organizational simplification, and Interventional Urology is ahead of plan.
Q: What is the phasing of the Funding the Journey savings and the margin through 2026-'27? A: CFO Anders Lonning-Skovgaard said around 75% of the DKK500 million Funding the Journey impact is expected in 2026-'27, with the remainder in 2027-'28. Some savings, including from China, should be visible in Q1 but will be reinvested. He also said growth should start softer in Q1 due to Biologics and improve from Q2, with a similar margin pattern, while FX should be a positive factor mainly in the second half.
Q: How should investors think about the energy and raw material hedges and their impact on future margins? A: CFO Anders Lonning-Skovgaard said 2026-'27 assumptions include 3% to 4% raw material and freight inflation, with energy hedged and broadly flat in absolute cost terms versus the prior year. He noted some energy consumption is already hedged into 2027-'28 and that total energy costs represent around 2% of the cost base.
Q: What is the outlook for China and the competitive environment there? A: CFO Anders Lonning-Skovgaard said China had negative growth in 2025-'26 due to inventory reduction and increased local competition, particularly in consumer sentiment. Coloplast expects China to be roughly flat from 2026-'27 onward. China represents around 4% of total revenue.
Q: How should investors decompose the mid-single-digit growth expectation for W
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
