A message from the Chairman and the CEO

Dear shareholders, 

While the COVID-19 pandemic is largely behind us, its consequences on healthcare systems globally continue to reverberate. In addition to the current staffing shortages and procedural backlogs, demographic trends and economic constraints will continue to put more pressure on healthcare systems in the coming decades. At the same time, current macroeconomic and geopolitical trends have significantly challenged our operating environment.

At Coloplast, we are building the consumer healthcare company of the future – a company that helps keep people out of the hospital and empowers them to take care of themselves. This is our business model.

While macroeconomic challenges, including COVID-19 and inflation, have put pressure on our performance in the first half of the Strive25 strategic period, they have also confirmed the strength of our model as we have been able to maintain solid organic growth and industry-leading profitability levels. We aim to emerge even stronger in the 
second half of Strive25 and position ourselves for long-term value creation.

Strive25 strategy update 
Innovation remains a key driver of our organic growth. Through differentiated 
technologies, we have been winning in our Chronic Care core businesses, Ostomy Care and Continence Care, for decades. We have a strong pipeline in Chronic Care with a significant number of new product launches over the next few years, starting with LujaTM, our new intermittent catheter. 

This is the first product from our Clinical Performance Programme and the most important product launch in Continence Care in the last decade. 

At the same time, with our Strive25 strategy we set out to actively pursue M&A opportunities to build growth and value creation options for the mid- and long-term. In the last three years, we have strengthened our portfolio with three significant acquisitions. First, the Intibia technology for treatment of overactive bladder in Interventional Urology, which we expect to launch in 2025/26. 
Second, the addition of Voice and Respiratory Care, a new chronic care business area, through the Atos Medical acquisition, which we expect to grow 8-10% p.a. And finally, with the latest addition of Kerecis we obtain a longterm growth business, expected to contribute around 1%-point to organic growth as of 2024/25, with strong profitability expansion potential and EPS accretion expected from 2026/27.

The current inflationary environment has represented a temporary setback for our profitability. As we look towards the second half of our Strive25 period, we expect to come back to an EBIT margin of 30%, before impact from the Kerecis acquisition, driven by an easing of the inflationary pressure and continued support from our Global Operations Plans.

Through a balanced mix of organic and inorganic initiatives during the first half of the Strive25 period, we are well positioned to accelerate our long-term organic growth to 8-10%, while maintaining our long-term commitment to industry leading profitability of more than 30%. 

Acquisition of Kerecis
A key highlight from the past year is the acquisition of Kerecis, an emerging category leader in the biologics wound care segment, with a clinically differentiated technology based on intact fish skin. With Kerecis, we obtain a unique opportunity to transform our presence in the wound care market and accelerate group growth.

Our companies share many similarities and fit well together. We are both on a mission to help more people in need of advanced wound treatment, we are leaders in innovation and sustainability, and we both share values rooted in Nordic cultures. Kerecis has a strong commercial presence in the US, providing immediate scale in the market, while Coloplast’s footprint and infrastructure provide a global expansion backbone for Kerecis’ fishskin technology beyond the US. The acquisition is a natural extension of our intent to build growth platforms for the mid- and long-term beyond our chronic care core businesses.