Coloplast — Earnings Release 2022

Nov 7, 2022

Announcement no. 09/2022
7 November 2022

Coloplast

Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

Coloplast A/S
Holtedam 1
DK-3050 Humlebaek,
Denmark

Company reg. (CVR)
no. 69749917

2021/22

Announcement of full-year financial results 2021/22

1 October 2021 - 30 September 2022

Coloplast delivered Q4 organic growth of 5% and 30% EBIT margin before special items

• Coloplast delivered 5% organic growth in Q4. Reported revenue in DKK was up by 19%. Organic growth rates by business area were: Ostomy Care 5%, Continence Care 6%, Interventional Urology 12%, and Wound & Skin Care -5% (Wound Care -6%). Voice and Respiratory Care contributed 9%-points to reported growth, with high single-digit underlying growth.
• Continued solid momentum in Chronic Care across regions, ex. China. Ostomy Care in China remained impacted by COVID-19 and detracted from growth. Continence Care growth continued to be impacted by backorders in Collecting Devices.
• Growth in the wound care business was impacted by a high baseline in Emerging markets last year due to tender phasing and negative growth in China. Continued good underlying growth momentum in Europe and the Biatain® Silicone portfolio.
• Continued strong growth across all business areas in Interventional Urology, led by Men's Health in the US.
• EBIT before special items was DKK 1,814 million, a 10% increase from last year. The EBIT margin before special items was 30% against 32% last year, reflecting a normalisation of commercial activities and increasing costs for energy, raw materials, and logistics, as well as around DKK 56 million in amortisation costs related to the Atos Medical acquisition.

FY 2021/22 organic growth of 6% and 31% EBIT margin before special items, in line with guidance

• Coloplast delivered 6% organic growth for the full year. Reported revenue in DKK was up by 16% to DKK 22,579 million. Organic growth rates by business area were: Ostomy Care 7%, Continence Care 6%, Interventional Urology 9%, Wound & Skin Care 4% (Wound Care alone 4%). Voice and Respiratory Care contributed 6%-points to the reported growth.
• EBIT before special items amounted to DKK 6,910 million, a 9% increase from last year. The EBIT margin before special items was 31% against 33% last year and includes DKK 152 million in amortisation costs related to the Atos Medical acquisition. EBIT margin after special items was 29%, impacted by DKK 471 million in special items¹).
• ROIC after tax before special items was 27% against 45% last year, negatively impacted by the acquisition of Atos Medical. Diluted earnings per share (EPS) before special items increased by 3% to DKK 23.82.
• The Board of Directors recommends a year-end dividend of DKK 15.00 per share, which brings the total dividend for the year to DKK 20.00 per share, compared to DKK 19.00 per share last year.

2022/23 financial guidance – organic revenue growth at 7-8% and EBIT margin of 28-30%

• Organic revenue growth is expected at 7-8% in constant exchange rates. Reported growth in DKK is expected at 11-12% and includes contribution from the Atos Medical acquisition of around 3%-points (4 months impact) and around 1%-point positive impact from currencies.
• Reported EBIT margin is expected at 28-30%, impacted by increasing input costs, especially raw materials and electricity cost in Hungary, partly offset by leverage, efficiency gains and prudent management of operational expenses.
• Capital expenditures are expected to be around DKK 1.4 billion. The effective tax rate is expected to be around 21%.

"We deliver a solid set of numbers in 2021/22 with 6% organic growth and an EBIT margin of 31% before special items, which is in line with our financial guidance. We continue to take market share across all our sales regions and business areas and have industry leading profitability levels despite the impact from COVID-19 in China and higher input costs. This means that we continue to help more and more people with intimate healthcare needs live better lives. I would like to highlight our strong performance in Chronic Care, driven by solid growth across all our regions excluding China. I am also very pleased with our performance in Interventional Urology and Voice & Respiratory Care where we continue to see a solid growth momentum. I'd like to thank our employees for all their hard work and commitment to our company and mission," says President and CEO Kristian Villumsen.

Conference call

Coloplast will host a conference call on Monday, 07 November 2022 at 15.00 CET.

The call is expected to last about one hour.

To actively participate in the Q&A session please sign up ahead of the conference call on the link here to receive an e-mail with dial-in details Register here

Access the conference call webcast directly here:

https://getvisualtv.net/stream/register/?coloplast-fvyl2givq6

¹) DKK 300 million provision for costs related to the US lawsuits alleging injury from the use of transvaginal surgical mesh products, and DKK 171 million related to the Atos Medical acquisition.

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Announcement no. 09/2022

07 November 2022

Colloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Financial highlights and key ratios

1 October 2021 – 30 September 2022, unaudited

Consolidated	2021/22	2020/21	Change	2021/22	2020/21	Change
	12 mths	12 mths		Q4	Q4
Income statement, DKK million
Revenue	22,579	19,426	16%	6,059	5,100	19%
Research and development costs	-866	-755	15%	-217	-207	5%
Operating profit before interest, tax, depr. and amort. (EBITDA) before special items	7,840	7,147	10%	2,073	1,841	13%
Operating profit before interest, taxes and amortization (EBITA) before special items	7,170	6,484	11%	1,900	1,674	14%
Operating profit (EBIT) before special items	6,910	6,355	9%	1,814	1,650	10%
Special items	-471	-200	N/A	-36	-	N/A
Operating profit (EBIT)	6,439	6,155	5%	1,778	1,650	8%
Net financial income and expenses	-312	78	N/A	-166	-6	N/A
Profit before tax	6,127	6,233	-2%	1,612	1,644	-2%
Net profit for the period	4,706	4,825	-2%	1,230	1,305	-6%
Revenue growth, %
Period growth in revenue, %	16	5		19	11
Growth break down:
Organic growth, %	6	7		5	10
Currency effect, %	4	-2		5	1
Acquired operations, %	6	-		9	-
Balance sheet, DKK million
Total assets	34,956	15,841	N/A	34,956	15,841	N/A
Capital invested	27,679	11,576	N/A	27,679	11,576	N/A
Net interest-bearing debt (NIBD)	18,091	2,112	N/A	18,091	2,112	N/A
Equity end of period	8,292	8,168	2%	8,292	8,168	2%
Cash flow and investments, DKK million
Cash flows from operating activities	5,099	5,290	-4%	2,140	1,954	10%
Cash flows from investing activities	-11,759	-2,011	N/A	-401	-301	33%
Investments in property, plant and equipment, gross	-927	-919	1%	-308	-261	18%
Free cash flow	-6,660	3,279	N/A	1,739	1,653	5%
Cash flows from financing activities	6,591	-3,176	N/A	-1,959	-1,656	18%
Key ratios
Average number of employees, FTEs1)	13,650	12,578		14,577	12,714
Operating margin (EBIT margin) before special items, %	31	33		30	32
Operating margin (EBIT margin), %	29	32		29	32
Operating margin before interest, tax, depr. and amort., (EBITDA margin), %	33	36		34	36
Gearing ratio, NIBD/EBITDA before special items	2.3	0.3		2.2	0.3
Return on average invested capital before tax (ROIC), %2)	35	58		26	55
Return on average invested capital after tax (ROIC), %2)	27	45		20	44
Return on equity, %	64	70		63	69
Equity ratio, %	24	52		24	52
Net asset value per outstanding share, DKK	39	38	3%	39	38	3%
Share data
Share price, DKK	776	1,007	-23%	776	1,007	-23%
Share price/net asset value per share	19.9	26.2	-24%	19.9	26.2	-24%
Average number of outstanding shares, millions	212.5	212.8	0%	212.3	212.8	0%
PE, price/earnings ratio	35.0	44.4	-21%	33.5	41.0	-18%
Pay-out ratio, %3)	83.7	81.2	3%	-	-
Earnings per share (EPS), diluted	22.11	22.63	-2%	5.79	6.12	-5%
Earnings per share (EPS) before special items, diluted	23.82	23.36	2%	5.92	6.12	-3%
Free cash flow per share	-31.3	15.4	N/A	8.2	7.8	5%

1) Includes Atos Medical employees at the end of the period.2) Before special items. After special items, ROIC before tax was 33% (2020/21: 57%), and ROIC after tax was 25% (2020/21: 44%).
2) This item is before special items. After special items, the pay-out ratio was 90.2% (2020/21: 84%).

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Stríve25

Update on strategic priorities

In September 2020, Coloplast presented the "Strive25 – Sustainable Growth Leadership" strategy. Below are key highlights on the progress made during the financial year 2021/22.

Growth

Atos Medical acquisition

The acquisition of Atos Medical was completed on 31 January 2022, adding a new chronic care business segment, Voice and Respiratory Care, expected to grow 8-10% organically, with an EBITDA margin in the mid-30s. The business continued to perform well, growing at a solid high single-digit underlying growth. The integration process is ongoing and progressing as expected.

US Chronic Care

Strong performance in the US Ostomy Care during 2021/22, with market share gains in the acute channel, on the back of the GPO wins and sales force expansion. Key contract wins during 2021/22 include AscenDrive, Allied Health Solutions and NYU Langone Health.

Innovation

Chronic Care – Clinical Performance Programme

Solid progress on the new catheter platform, Luja™. The pivotal studies are on track, and the launch is expected in the second half of FY 2022/23.

Heylo™, the new digital leakage platform, is in a pilot launch in Germany and the UK and has been received well by users. The clinical studies are on track, and the product is expected to launch in 2023.

Coloplast has decided to refocus R&D efforts and reallocate resources from the new ostomy care platform with skin protective technology to other promising platforms and ongoing projects, as a result of a recently published guidance on Medical Device Regulation, which classifies the skin protective technology as a class III device.

Sustainability

Reducing emissions

Scope 1 and 2 emissions in 2021/22 were reduced by 8% compared to the base year 2018/19, driven by the installation of an electric heating pump and electric equipment at our production sites in Hungary and China.

Coloplast's carbon emission reduction targets were approved by the Science Based Target initiative (SBTI), a recognition of our efforts to contribute to a 1.5°C future.

Improving products and packaging

Solid progress on production waste recycling, with 71% of production waste recycled in 2021/22. The development continues to be driven by the recycling partnership established in Hungary.

Operational efficiency

Global Operations Plan 5

The second volume site in Costa Rica opened in 2021/22. Ramp up is ongoing, and the volume sites in Costa Rica are expected to account for around 25% of volumes by the end of the Strive25 strategy period.

Solid progress on the automation programme. On track to be FTE neutral at the end of the Global Operations Plan 5 period in 2022/23 with a net impact of around 1,000 FTEs, despite some headwind from longer component lead times.

Global Business Support and IT landscape

Positive scale effect driven by further utilization of the Coloplast Business Centre and IT infrastructure.

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Sales performance

The full-year 2021/22 organic growth was 6%. Reported revenue in DKK was up by 16% to DKK 22,579 million. Exchange rate developments increased revenue by 4%-points, mainly related to the appreciation of the USD, GBP and CNY against DKK. Revenue from acquisitions contributed 6%-points, as a result of the Atos Medical acquisition in the second quarter of 2021/22.

Organic growth in the fourth quarter was 5%. Reported revenue in DKK was up by 19% to DKK 6,059 million. Exchange rate developments increased revenue by 5%-points, mainly related to appreciation of the USD and CNY against DKK. Revenue from acquisitions contributed 9%-points, as a result of the acquisition of Atos Medical.

Sales performance by business areas	DKK million		Growth composition (12 mths)
	2021/22 (12 mths)	2020/21 (12 mths)	Organic growth	Acquired operations	Exchange rates	Reported growth
Ostomy Care	8,620	7,841	7%	-	3%	10%
Continence Care	7,643	7,003	6%	0%	3%	9%
Interventional Urology	2,424	2,097	9%	-	7%	16%
Wound and Skin Care	2,689	2,485	4%	-	4%	8%
Voice and Respiratory Care	1,203	-	n/a	n/a	n/a	n/a
Revenue	22,579	19,426	6%	6%	4%	16%
	DKK million		Growth composition (Q4)
	2021/22 (Q4)	2020/21 (Q4)	Organic growth	Acquired operations	Exchange rates	Reported growth
Ostomy Care	2,253	2,058	5%	-	4%	9%
Continence Care	2,030	1,835	6%	0%	5%	11%
Interventional Urology	642	524	12%	-	11%	23%
Wound and Skin Care	688	683	-5%	-	6%	1%
Voice and Respiratory Care	446	-	n/a	n/a	n/a	n/a
Revenue	6,059	5,100	5%	9%	5%	19%
Sales performance by region	DKK million		Growth composition (12 mths)
---	---	---	---	---	---	---
	2021/22 (12 mths)	2020/21 (12 mths)	Organic growth	Acquired operations	Exchange rates	Reported growth
European markets	12,916	11,261	5%	8%	2%	15%
Other developed markets	5,775	4,785	6%	6%	9%	21%
Emerging markets	3,888	3,380	10%	1%	4%	15%
Revenue	22,579	19,426	6%	6%	4%	16%
	DKK million		Growth composition (Q4)
	2021/22 (Q4)	2020/21 (Q4)	Organic growth	Acquired operations	Exchange rates	Reported growth
European markets	3,380	2,912	4%	11%	1%	16%
Other developed markets	1,663	1,285	7%	8%	14%	29%
Emerging markets	1,016	903	4%	2%	7%	13%
Revenue	6,059	5,100	5%	9%	5%	19%

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Announcement no. 09/2022

7 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Ostomy Care

Ostomy Care generated 7% organic sales growth for the 2021/22 financial year, with reported revenue in DKK growing by 10% to DKK 8,620 million.

The SenSura® Mio portfolio and the Brava® range of supporting products continued to be the main drivers of revenue growth. At the product level, SenSura Mio Convex was the main contributor to growth driven by Europe, especially the UK and Germany, as well as the US. SenSura Mio Concave also contributed to growth, driven mostly by Europe. The SenSura and Assura/Alterna® portfolios continued to contribute to growth in the Emerging markets region, where they are being actively promoted, most notably LATAM. Sales of the Brava range of supporting products continued to contribute to growth, driven by Europe, especially the UK and France, the US, as well as broad-based growth in the Emerging markets region.

From a geographical perspective, Europe was the main contributor to growth, led by the UK. The US delivered a strong year and contributed nicely to growth. Emerging markets excluding China also made a solid contribution to growth, driven by LATAM.

In China, COVID-19 restrictions hampered growth and led to a lower level of procedural volumes and sales in the hospital channel. The average value per patient remained below pre-COVID levels, due to economic uncertainty which continued to impact consumer sentiment.

Outside of China, growth in new patients during the year was largely normalised at pre-COVID levels.

Q4 organic growth was 5% and reported revenue in DKK increased by 9% to DKK 2,253 million.

The SenSura Mio portfolio and the Brava range of supporting products were the main contributors to growth. SenSura Mio Convex was the main contributor to growth driven by the US and Europe, in particular the UK and Germany. Revenue growth in the Brava range of supporting products was broad-based and driven by the US, the UK, and the Emerging markets region.

From a geographical perspective, Europe was the main growth contributor, driven by the UK. The US also made a nice contribution to growth. Growth contribution from Emerging markets excluding China was mostly driven by LATAM.

China detracted from growth, due to continued negative impact from COVID-19 related restrictions. Hospital access remained limited, impacting procedural volumes and growth in new patients.

The global market for ostomy care products is worth an estimated DKK 20-21 billion, and the annual market growth is estimated at 4-5%. Coloplast is the global market leader with a market share of 35-40%. The supporting products category is estimated at DKK 3-4 billion of the overall market for ostomy care, with an estimated annual growth of 6-8%. Coloplast has a market leading position within this segment as well, with a market share of 35-40%.

2.3 billion

Reported revenue in DKK for Q4 2021/22

Organic growth

Full-year

Q4 21/22

Reported growth

Full-year

Q4 21/22

European markets
Other developed markets
Emerging markets

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Continence Care

Continence Care generated 6% organic sales growth for the 2021/22 financial year, with reported revenue in DKK growing by 9% to DKK 7,643 million.

The SpeediCath® intermittent catheters were the main drivers of revenue growth. Sales growth in the SpeediCath portfolio was driven by compact catheters, standard catheters, and flexible catheters, all of which are ready-to-use hydrophilic coated catheters. The growth in flexible catheters and compact catheters was mainly driven by Europe, in particular France, the UK and Germany, as well as the US. SpeediCath Navi, a hydrophilic catheter specifically designed for emerging markets and lower priced developed markets, also contributed nicely to growth.

The Bowel Management business made a solid contribution to growth, driven by Peristeen® in Europe and the US.

Collecting Devices had a negative impact on growth, due to backorders on Conveen® urisheaths. The backorder situation emerged in Q2, due to shortages experienced by a raw material supplier.

From a geographical perspective, sales growth was driven by Europe, in particular the UK, as well as the US and LATAM. Markets with recent reimbursement openings, such as Poland, Australia, Japan and South Korea, delivered double-digit growth.

In the US, growth in the first half of 2021/22 was negatively impacted by lower growth in new patients, due to COVID-19. During the second half, growth in new patients normalised at pre-COVID levels.

Elsewhere, growth in new patients during the year was largely normalised at pre-COVID levels.

Q4 organic growth was 6% and reported revenue in DKK increased by 11% to DKK 2,030 million.

Sales growth in Q4 was driven by the SpeediCath portfolio, and more specifically compact, flexible and standard catheters. SpeediCath Flex Set, a flexible hydrophilic catheter with a new integrated sterile bag, has been launched in seven markets. The product is performing well and contributed to the growth in the SpeediCath portfolio.

Bowel Management also contributed to growth in Q4, driven mainly by Europe. Peristeen Plus, the newest addition to the Bowel Management portfolio, has been well-received and is on track to replace Peristeen as the standard of care in the 19 markets where the product has been launched.

Collecting Devices continued to negatively impact growth, due to the backorders on Conveen urisheaths. Production continues at reduced capacity due to supply uncertainty and sporadic shortages, which are expected to continue into Q1 2022/23.

From a geographical perspective, all regions contributed to growth, led by Europe, in particular the UK and Germany, as well as the US, and LATAM.

The global market for continence care products, defined as intermittent catheters and collecting devices, is worth an estimated DKK 15-16 billion, and the annual market growth is estimated at 5-6%. Coloplast is the global market leader with a market share of 40-45%.

2.0 billion

Reported revenue in DKK for Q4 2021/22

Organic growth

Full-year

Q4 21/22

Reported growth

Full-year

Q4 21/22

European markets
Other developed markets
Emerging markets

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Voice and Respiratory Care

The acquisition of Atos Medical was completed on 31 January 2022, adding a new chronic care business segment, Voice and Respiratory Care. The integration of Atos Medical into Coloplast is progressing according to plan, with continued strong business momentum.

Voice and Respiratory Care contributed 6%-points to the reported growth for the 2021/22 financial year, reflecting eight months of revenue impact.

The underlying growth of Voice and Respiratory Care was solid high single-digit, in line with expectations. Growth was driven by Laryngectomy, which represents around two-thirds of revenues, with a solid double-digit underlying growth, driven by growth in patients served in existing and new markets, as well as an increase in patient value driven by the Provox® Life™ portfolio. Provox Life is Atos Medical's new personalized solution and product line designed to optimize patient's breathing ability under different circumstances, further enabling 24/7 use of Heat and Moisture Exchangers (HMEs) for improved pulmonary health. The Provox Life portfolio is now launched in 15 of the 25 countries where Atos has its own subsidiaries.

Tracheostomy and ENT (Ear, Nose and Throat), which represent around one-third of revenues, also contributed to growth, with an underlying mid-single digit growth, in line with expectations.

From a geographical perspective, all regions contributed to growth, led by the biggest region Europe. The US also delivered a solid contribution to growth, while the fastest growing region was Emerging markets.

In Q4, Voice and Respiratory Care contributed 9%-points to the reported growth. The underlying growth of Voice and Respiratory Care in the quarter was high single-digit.

Laryngectomy was the main growth contributor, with a high single-digit underlying growth, which continued to be driven by growth in patients served in existing and new markets, as well as an increase in patient value driven by the Provox Life portfolio.

Tracheostomy and ENT also continued to contribute to growth and grew in line with expectations of mid-single digit underlying growth.

From a geographical perspective, all regions continued to contribute to the solid development, with the main growth contribution from the biggest region Europe, as well as solid contribution from Other developed markets, most notably the US. Emerging markets continued to be the fastest growing region.

The global market for laryngectomy products is worth an estimated DKK 1-1.5 billion, and the annual market growth is estimated at 8-10%. Coloplast is the global market leader in laryngectomy, with a market share of around 85%. The market remains significantly underpenetrated with a large unserved patient population. The low market penetration is due to a lack of clinical standards in existing markets, low treatment compliance, and lack of reimbursement in emerging markets.

1.2 billion

Reported revenue in DKK for FY 2021/22*

*Contain revenue for February – September, matching the period of the ownership of Atos Medical

Acquired growth impact

Full-year

Q4 21/22
European markets
Other developed markets
Emerging markets

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Wound and Skin Care

Wound and Skin Care generated 4% organic sales growth for the 2021/22 financial year, with reported revenue in DKK growing by 8% to DKK 2,689 million.

The wound care business alone delivered 4% organic growth for the financial year 2021/22.

The Biitain® Silicone portfolio was the main contributor to growth. Biitain® Fiber continues to perform well and also contributed to growth.

From a geographical perspective, Europe was the main growth contributor, driven by solid momentum in Germany and Spain. Emerging markets excluding China also contributed nicely to growth. China had a negative impact on growth, due to COVID-19 restrictions, which have led to a decline in procedural volumes and sales in the hospital channel.

The Compeed contract manufacturing business made a solid contribution to growth and grew double-digit, reflecting improved consumer demand, as well as a lower baseline last year.

The skin care business, which is mostly a US hospital business, had a negative impact on growth impacted by lower demand due to COVID-19.

Q4 organic growth for Wound and Skin Care was -5%, while reported revenue in DKK increased by 1% to DKK 688 million.

The wound care business in isolation declined 6% in Q4.

The negative growth was primarily driven by region Emerging markets, due to a high baseline in Q4 last year, impacted by tender phasing in the Middle East region. China declined significantly in Q4, due to the continued impact of COVID-19 related restrictions.

Performance in Europe was impacted by backorders due to sporadic raw materials shortages. The underlying growth momentum in Europe remained solid, driven by Germany and the Biitain Silicone portfolio.

Growth in the Compeed contract manufacturing business was flat, impacted by a high baseline last year.

The skin care business had a negative impact on growth. The high level of hospital staff turnover due to COVID-19 has led to reduced focus on and awareness of skin care treatment solutions, resulting in lower demand in the market.

The global advanced wound care market is worth an estimated DKK 24-26 billion, excluding negative pressure wound therapy. The annual market growth is estimated at 2-4%. Coloplast is the world's fifth largest manufacturer, with a market share of 5-10%.

The global market for skin care products is worth an estimated DKK 4-5 billion, with an estimated annual growth of 2-4%. Coloplast holds a market share of 10-15% in the fragmented skin care segment, which is mainly a US-based, hospital business.

0.7 billion

Reported revenue in DKK for Q4 2021/22

Organic growth

4%

Full-year

.5%

Q4 21/22

Reported growth

8%

Full-year

1%

Q4 21/22

European markets
Other developed markets
Emerging markets

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Interventional Urology

Interventional Urology generated 9% organic sales growth for the 2021/22 financial year, with reported revenue in DKK growing by 16% to DKK 2,424 million.

Growth was broad-based, driven by both Men's and Women's Health in the US, and Endourology in Europe, most notably France. Region Emerging markets also contributed nicely to the growth in Endourology.

The Men's Health business, which is mainly a US business, delivered a solid contribution to growth in 2021/22 driven by the Titan® penile implants. Elective procedure volumes within Men's Health were healthy throughout the year.

The Women's Health business, which is also primarily a US business, made a solid contribution to growth as well. Growth was driven by both the mesh product portfolio for pelvic organ prolapse treatment and the sling portfolio for treatment of stress urinary incontinence.

Performance in Endourology continues to be driven by Europe. The US also contributed nicely to growth in 2021/22, on the back of successful US product registration and investments into a specialised US endourology sales force.

From a geographical perspective, the US was the main growth contributor, followed by Europe, and in particular France and Spain.

Q4 organic growth was 12% and reported revenue in DKK increased by 23% to DKK 642 million.

Men's Health was the largest contributor to growth in Q4, driven mainly by Titan® penile implants in the US. Region Emerging markets also contributed nicely to growth.

Women's Health in the US and Endourology in Europe also delivered a solid quarter and contributed nicely to the growth.

From a geographical perspective, growth in Q4 was primarily driven by the US. Europe, most notably France, and region Emerging markets also contributed to growth.

In 2021/22, the global market for interventional urology products, in which Coloplast operates, was worth an estimated DKK 13-14 billion, up from DKK 12-13 billion in 2020/21. The increase followed a resumption in elective procedures and a continued improvement in growth in 2021/22. The annual market growth is estimated at 3-5%. Coloplast holds a market share of around 15-20% and is the fourth largest manufacturer within this market.

0.6 billion

Reported revenue in DKK for Q4 2021/22

Organic growth
Full-year
Q4 21/22

Reported growth
Full-year
Q4 21/22

European markets
Other developed markets
Emerging markets

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Earnings

Gross profit

Gross profit was DKK 15,529 million compared to DKK 13,313 million last year and equivalent to a gross margin of 69%, on par with last year. The gross margin included a positive impact from currencies, mainly related to the appreciation of USD, GBP and CNY against DKK. The depreciation of the HUF against DKK also contributed positively. Around 80% of the company's production volumes are in Hungary. In addition to currencies, the gross margin was positively impacted by the inclusion of Atos Medical, and operating leverage and efficiency savings from Global Operations Plan 5.

The above-mentioned positive drivers were largely offset by double-digit wage inflation in Hungary, increasing prices for raw materials, energy, and transportation, as well as ramp-up costs in Costa Rica.

In Q4, gross profit was DKK 4,170 million, corresponding to a Q4 gross margin of 69%, on par with Q4 last year. The Q4 margin was impacted by the above-mentioned drivers.

Costs

Operating expenses amounted to DKK 8,619 million, a DKK 1,661 million increase (24%) from last year. Atos Medical contributed with DKK 754 million to operating expenses (8 months impact), of which DKK 152 million were amortisation costs, included under distribution costs.

Excluding the Atos Medical impact, operating expenses increased by DKK 907 million, or 13%, from last year.

Distribution costs amounted to DKK 6,797 million, a DKK 1,312 million increase (24%) from DKK 5,485 million last year and were impacted by the inclusion of Atos Medical (8 months impact). Distribution costs amounted to 30% of revenue compared to 28% last year. The higher distribution costs reflect a normalisation of sales, marketing and travel expenses as COVID-19 restrictions were eased across most markets. Distribution costs were likewise impacted by higher logistics costs, as a result of increased freight rates, as well as continued commercial investments in the US, Interventional Urology, consumer and digital initiatives.

In Q4, distribution costs amounted to DKK 1,872 million, equal to 31% of revenue against 29% in the same period last year, impacted by the above-mentioned drivers.

Administrative expenses amounted to DKK 1,005 million, up DKK 243 million (32%) from DKK 762 million last year and were impacted by the inclusion of Atos Medical (8 months impact). The increase in administrative expenses was driven by legal, consultancy and IT costs. Administrative expenses accounted for 4% of revenue, on par with last year.

The Q4 administrative expenses amounted to 5% of revenue, compared to 4% in the same period last year.

The R&D costs were DKK 866 million, a DKK 111 million (15%) increase compared to last year, due to an increased activity level across all business areas. R&D costs amounted to 4% of revenue on par with last year. The R&D costs were also impacted by the inclusion of Atos Medical (8 months impact).

The Q4 R&D costs amounted to DKK 217 million or 4% of revenue, in line with the same period last year.

Other operating income and other operating expenses amounted to a net income of DKK 49 million, against DKK 44 million last year.

Income statement, DKK million	2021/22	Index
Revenue	22,579	116
Production costs	-7,050	115
Gross profit	15,529	117
Distribution costs	-6,797	124
Administrative expenses	-1,005	132
Research and development costs	-866	115
Other operating income	74	101
Other operating expenses	-25	86
Operating profit (EBIT) before special items	6,910	109
Special items	-471	N/A
Operating profit (EBIT)	6,439	105
Financial income	119	87
Financial expenses	-431	731
Profit before tax	6,127	98
Tax on profit for the period	-1,421	101
Net profit for the period	4,706	98

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Announcement no. 09/2022
07 November 2022
Coloplast
Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

Operating profit (EBIT) before special items

EBIT before special items amounted to DKK 6,910 million, a DKK 555 million (9%) increase from DKK 6,355 million last year. The EBIT margin before special items was 31% compared to 33% last year. The EBIT margin includes a positive impact from currencies, mainly related to the appreciation of USD, GBP and CNY against DKK. EBIT was negatively impacted by higher sales and marketing activities and travel expenses as COVID-19 restrictions were eased across most markets, continued commercial investments, as well as DKK 152 million in amortisation costs related to the Atos Medical acquisition.

In Q4, EBIT before special items was DKK 1,814 million, a DKK 164 million (10%) increase from the same period last year. The EBIT margin before special items was 30% in Q4, against last year's EBIT margin of 32%. EBIT in the quarter was impacted by the aforementioned drivers.

Special items

During the financial year of 2021/22, Coloplast incurred special items expenses of DKK 471 million.

In Q2, Coloplast made a further provision of DKK 300 million to cover potential settlements and costs in connection with lawsuits in the US alleging injury resulting from the use of transvaginal surgical mesh products designed to treat pelvic organ prolapse and stress urinary incontinence. The increase comes as the process is taking longer than previously anticipated, including delays due to COVID-19, which has led to an increase in legal advisory costs. The increase brings the total amount recognised since the 2013/14 financial year for expected costs of litigation in the USA to DKK 6.15 billion including legal costs (before insurance cover of DKK 0.5 billion). Coloplast continues to make settlement progress on unresolved MDL cases and has now settled around 99% of the former MDL cases.

The remaining expenses of DKK 171 million are related to transaction and integration costs, in connection with the acquisition of Atos Medical.

Special items expenses in Q4 amounted to DKK 36 million, related to the acquisition of Atos Medical.

Operating profit (EBIT) after special items

EBIT after special items was DKK 6,439 million. The EBIT margin after special items was 29%.

The Q4 EBIT after special items was DKK 1,778 million, for a margin of 29%.

Financial items and tax

Financial items were a net expense of DKK 312 million, compared to a net income of DKK 78 million last year. The net expense was primarily due to losses on currency hedges of DKK 191 million, on mainly GBP and USD, and fees of DKK 68 million, of which DKK 39 million are loan fees in relation to the Atos Medical acquisition. Interest expenses amounted to DKK 156 million, from DKK 13 million last year, impacted by the financing of the Atos Medical acquisition. This was only partly offset, mainly by gains on balance sheet items denominated in foreign currencies, including CNY and USD, of DKK 57 million.

The Q4 financial items were a net expense of DKK 166 million, compared to a net expense of DKK 6 million in the same period last year, driven by losses on balance sheet items, interest expenses and currency hedges as explained above.

The tax rate was 23.2%, compared to 22.6% last year. The tax expense amounted to DKK 1,421 million against DKK 1,408 million last year. The tax rate was impacted by non-deductible expenses, partly offset by a temporary increase in the tax-deductible value on R&D expenses in Denmark.

Net profit

Net profit before special items was DKK 5,068 million, a DKK 87 million increase from DKK 4,981 million last year. Diluted earnings per share (EPS) before special items increased by 2% from DKK 23.36 last year to DKK 23.82.

Net profit after special items was DKK 4,706 million and diluted earnings per share (EPS) after special items were DKK 22.11.

The Q4 net profit before special items amounted to DKK 1,257 million, against DKK 1,305 million last year. The Q4 diluted earnings per share (EPS) before special items, were down 3% from last year to DKK 5.92.

The Q4 net profit after special items was DKK 1,230 million and diluted earnings per share (EPS) after special items were DKK 5.79 per share.

Cash flows and investments

Cash flows from operating activities

Cash flows from operating activities amounted to DKK 5,099 million, against DKK 5,290 million last year. The negative development in cash flows from operating activities was mainly due to an increase in inventories, other receivables, and expired hedges.

Investments

Coloplast made investments of DKK 1,135 million in the financial year 2021/22 or 5% of revenue, compared with DKK 1,966 million last year. Investments last year included the acquisition of Nine Continents Medical of DKK 950 million. Excluding acquisitions, investments last year

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Announcement no. 09/2022
07 November 2022
Coloplast
Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

amounted to DKK 1,016 million or 5% of revenue.

Total cash flows from investing activities were a DKK 11,759 million outflow, due to the acquisition of Atos Medical, against a DKK 2,011 million outflow in the same period last year.

Free cash flow

As a result, the free cash flow was an outflow of DKK 6,660 million compared to an inflow of DKK 3,279 million in the same period last year. The decrease was mainly driven by an increase in inventories and prepaid costs including costs related to the acquisition of Atos Medical. Adjusted for acquisitions, the free cash flow for the financial year 2021/22 was DKK 3,973 million, an increase of DKK 597 million compared to last year.

Capital resources

At 30 September 2022, Coloplast had net interest-bearing debt, including securities, of DKK 18,091 million, against DKK 2,112 million at 30 September 2021. The increase in net interest-bearing debt was mainly due to the acquisition of Atos Medical. The gearing ratio at the end of the period was 2.3x EBITDA (before special items).

Statement of financial position and equity

Balance sheet

At 30 September 2022, total assets amounted to DKK 34,956 million, an increase of DKK 19,115 million compared to 30 September 2021. The increase was mainly due to an increase in intangible assets driven by the acquisition of Atos Medical.

Working capital was 25% of revenue, compared to 24% at 30 September 2021, driven by an increase in inventories and trade receivables. Inventories increased by DKK 759 million to DKK 3,187 million, driven by increased safety stocks on raw materials, to provide protection from supply chain constraints, increase in finished goods due to the transfer of production to Costa Rica, and an increase in prices. Atos Medical contributed to the increase in inventories with DKK 151 million. Trade receivables increased by DKK 728 million to DKK 3,940 million. Atos Medical contributed to the increase in trade receivables with DKK 248 million. Trade payables increased by DKK 206 million relative to 30 September 2021 to stand at DKK 1,242 million.

Equity

Equity increased by DKK 124 million relative to 30 September 2021 to DKK 8,292 million. Payment of dividends amounting to DKK 4,041 million and net effect of treasury shares bought and sold of DKK 619 million was only partly offset by total comprehensive income for the period of DKK 4,783 million and share-based remuneration of DKK 51 million.

Dividends

Coloplast paid interim dividends totalling DKK 1,062 million in the third quarter, equal to DKK 5.00 per share.

Share buy-backs

A share buy-back programme of DKK 500 million was initiated in Q2 2021/22 and was completed on 21 April 2022.

Treasury shares

At 30 September 2022, Coloplast's holding of treasury shares consisted of 3,692,876 B shares, which was 493,527 more than at 30 September 2021. The increase was due to the share buy-back programme.

Return on invested capital

ROIC after tax before special items was 27% against 45% as of 30 September 2021. The decrease was due to the acquisition of Atos Medical.

12

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Announcement no. 09/2022

7 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Update on sustainability strategy and performance

Priority	Unit	2025 Ambition	FY 2021/22	FY 2020/21	Change
Improving products and packaging
Recyclable packaging1) 6)	% of total	90%	78%	75%	n.a.
Renewable materials in packaging1) 6)	% of total	80%	76%	70%	n.a.
Production waste recycling	% of total	75%	71%	58%	13%-p
Reducing emissions2)
Scope 1 and 2 emissions	% reduction	100% reduction by 20302) 5)	8%	-7%	n.a.
Renewable energy use	% of total	100%	72%	67%	5%-p
Electric company cars1) 8)	% of total	50%	4%	2%	2%-p
Scope 3 emissions1) (by 2030)	% reduction per product	50% reduction by 20302) 5)	9%	10%	n.a.
Business travel by air1)	% reduction	10% reduction2)	55%	81%	n.a.
Goods transported by air1)	% of total	< 5% of total	3%	2%	1%-p
Responsible operations
Lost time injury frequency	Parts per million	2.0	2.4	2.2	9%
Code of Conduct training1)	% of white collars	100%	100%	99%	1%
Female senior leaders (VP+ level)1)	% of total	40% by 2030	21%	24%	-3%-p
Diverse teams1)	% share of total teams	75%	55%	50%	5%-p
Employee satisfaction1) 4)	Engagement score	Above benchmark	8.2	8.2	-

Improving products and packaging
Production waste recycling increased to 71% in FY 2021/22, compared to 58% in FY 2020/21. The increase is a result of a continued scaling up of the recycling partnership established in Hungary.

In 2021/22 Coloplast joined the Circular Industrial Plastic partnership, which aims at mapping plastic materials currently used by partner companies to create better infrastructure and technologies for recycling. The partnership runs for three years, is partly funded by the Danish Ministry for Environment under the Danish Eco-Innovation Program (MUDP), and brings together 17 manufacturing companies, reprocessing companies, and knowledge partners.

Scope 1 and 2 emissions
Renewable energy use was 72% of the total energy use in FY 2021/22, positively impacted by efforts to phase

out natural gas at Coloplast's manufacturing sites in Nyírbátor in Hungary and Zhuhai in China. An electric heat pump has been installed at the Nyírbátor facility, and electric equipment has been installed at the Zhuhai site.

In addition to increasing renewable energy as a share of total energy use, Coloplast also achieved a 3% reduction in the total energy use in 2021/22. In total, the absolute emissions for the full year 2021/22 decreased by 8% compared to the base year 2018/19.

Coloplast signs a PPA covering energy consumption in Denmark
In 2021/22 Coloplast entered its first power purchase agreement (PPA), through a contract with Better Energy. The new agreement will deliver green power to Coloplast's Danish sites, ensuring renewable energy for 100% of Coloplast's electricity consumption in

Denmark from 2023/24 onwards. The PPA constitutes a ten-year agreement, where Coloplast will receive 9 GWh electricity per year.

The agreement marks an important milestone in Coloplast's efforts to replace renewable energy certificates (RECs) with PPAs. It also allows Coloplast to support the construction of new renewable power generation capacity in Denmark through Better Energy's construction of a new solar park of more than 70 hectares.

Responsible operations
The employee satisfaction across the company remained strong in 2021/22. Coloplast continues to uphold a high employee engagement score of 8.2, well above the healthcare industry benchmark. In addition, the voluntary turnover level for 2021/22 was 10.6%, a similar level to 2020/21, despite a very dynamic labour market.

6) Metric will only be reported on a semi-annual or full-year basis. 8) From base year 2018/19. 8) Ambition beyond 2025 is 100% of company cars to be converted to electrical vehicles by 2030. 9) Employee survey conducted twice a year. Latest industry benchmark from May 2022 was 7.4. 1) Target validated by Science-Based Targets initiative (SBTI). 2) Due to a new and improved reporting tool, the packaging data is not comparable with data previously reported. All numbers are excluding Atos Medical.

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Announcement no. 09/2022
07 November 2022
Coloplast
Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

Other matters

Clinical Performance Programme

The clinical performance program is progressing well, with two important launches of the new catheter platform, Luja™, and the digital leakage platform, Heylo™, coming up in 2022/23.

Over the past years, Coloplast has been developing a new ostomy platform including skin protective technology, with very good clinical results. According to a recently published guidance on Medical Device Regulation on borderline between medical devices and medicinal products, the new skin protective technology would result in a classification of the product as a class III device. This would require incremental investment and time, which impacts the business case and is not in-line with Coloplast's overall regulatory strategy for Ostomy Care.

As a result, Coloplast has decided to refocus the R&D efforts and reallocate the resources to other promising technologies, such as Heylo which has demonstrated great results in our pilot studies, as well as other ongoing projects within Ostomy Care. Coloplast will also continue to leverage the knowledge and insights from this work to develop alternative solutions for skin protection. This change in focus does not impact our Strive 25 guidance.

War in Ukraine

Coloplast continues to monitor the war in Ukraine closely. Our primary focus is to keep our people safe as well as to ensure that our around 100,000 users in Ukraine and Russia have access to products to manage their chronic conditions.

Revenue exposure in Russia and Ukraine combined was around 1% of group revenues in FY 2021/22, of which the majority is in Russia. Similar level of revenue exposure is expected in FY 2022/23.

Coloplast complies with all sanctions imposed by the EU, the UN, and the US on Russia. Medical devices are generally not targeted by sanctions and export controls, and as such Coloplast is able to continue serving its users in Russia. In Poland and Hungary, Coloplast employs around 400 Ukrainians and our local teams have initiated a number of activities to support Ukrainian colleagues such as transferring their families and finding housing and jobs. Coloplast has also donated large volumes of wound care products to humanitarian organisations.

Eurobond issuance

On 11 May 2022, Coloplast announced the successful issuance of EUR 2.2 billion senior notes under its Euro Medium Term Note programme. The net proceeds from the Eurobond issuance have been used for refinancing of the term loan facility established in connection to Coloplast's acquisition of Atos Medical, which closed on 31 January 2022. The blended interest rate for the debt financing package of the Atos Medical acquisition is expected to be 1.95% in FY 2022/23, and includes impact from the variable interest rate on the 2-year bond issue of EUR 650 million, linked to the 3-months EURIBOR, to be regulated mid-November.

Beyond the 2-year bond issue, the blended interest rate is the outcome of the 5-year and 8-year bond issues of EUR 850 million and EUR 700 million, respectively, hedges put in place in January on the 5-year and 8-year tranches, as well as the secured interest rate on the credit facility.

Launch of Thulium Fiber Laser Drive

As part of the strategy to expand into adjacent segments, Coloplast is entering the lasers segment, and will launch its first laser equipment, Thulium Fiber Laser (TFL) Drive in key markets during 2022 and 2023. TFL is the latest cutting-edge laser technology, bringing highly effective intra-operative performance. It is an all-in-one solution for lithotripsy, benign prostatic hyperplasia treatment and soft tissue, offering full support and customisation. The laser has been obtained via a distribution agreement and allows Coloplast to compete in the laser market, worth an estimated DKK 3 billion.

Meet the Management event 2022

Coloplast hosted an investor event at the headquarters in Humlebæk, Denmark on 31st August with around 60 in-person participants and around 200 virtual participants. All material from the day is available on our website under the dedicated investor relations section.

Timetable for dividend of DKK 15.00 per share

1 December 2022 – Declaration date
2 December 2022 – Ex-dividend date
5 December 2022 – Value date
6 December 2022 – Disbursement date

14

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Announcement no. 09/2022
07 November 2022
Coloplast
Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

2022/23

Financial guidance

7-8%
Organic revenue growth at constant exchange rates

28-30%
Reported EBIT margin

Around 1.4 bn
Capital expenditure in DKK

Around 21%
Effective tax rate

Long term financial guidance

The long-term financial guidance for the Strive25 strategy period running until end 2024/25 is the following:

7-9%
Organic growth p.a.

above 30%
EBIT margin at constant exchange rates

Key assumptions

The impact of current macroeconomic trends and global events, especially input costs development and COVID-19 in China, is continuously monitored and evaluated on a short- and medium-term basis. The financial guidance is subject to a higher degree of uncertainty due to the changing environment.

The addressable market in which Coloplast operates is expected to continue growing at 4-5% and includes negative impact from COVID-19 in China.

Revenue growth

Organic growth is expected at 7-8% in constant currencies and assumes:

a) Limited impact from COVID-19 on hospital activity across markets, except for China
b) The Chronic Care business excluding China is expected to grow largely in line with the Strive25 ambitions. The assumptions by region include:

• Continued good momentum in Europe
• US – sustained good momentum in Ostomy Care and improvement in growth in Continence Care
• Emerging markets – broad-based double-digit growth excluding China
• China is expected to remain impacted by COVID-19 restrictions, impacting hospital access and procedural volumes. Average value per patient is expected to remain below pre-COVID levels, impacted by consumer sentiment

c) Wound and Skin Care is expected to deliver growth above the market in line with the Strive25 ambitions. China is expected to remain impacted by COVID-19 restrictions, impacting hospital access and procedural volumes

d) Interventional Urology is expected to deliver high single-digit growth in line with the Strive25 ambitions
e) Voice and Respiratory Care is expected to grow at 8-10%, with 8 months impact on organic growth
f) Revenue exposure to Russia and Ukraine is expected to be on par with 2021/22 i.e., around 1% of group revenues with a flat growth rate in FY 2022/23
g) No current knowledge of significant health care reforms; positive pricing impact is expected
h) A stable supply and distribution of products across the company; impact from backorders in Collecting Devices and Wound Care expected to persist into H1 2022/23

Reported growth in DKK is expected at 11-12%, due to favourable FX movements, expected around 1%-point, and impact from the Atos Medical acquisition, expected around 3%-points (4 months impact).

The expectation of long-term price pressure of up to 1% annually is unchanged.

EBIT margin

The EBIT margin is expected at 28-30%, and assumes:

a) Leverage effect on fixed costs and continued efficiency improvements through Global Operations Plan 5
b) An increase in input costs, driven mostly by:

• Raw materials – double-digit price increase
• Energy – doubling of electricity cost compared to 2021/22
• Wages in Hungary – double-digit increase

c) Prudent management of operating costs, expected to grow below reported revenue in DKK (excluding acquired growth)

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

d) Full year impact of around DKK 230 million of amortisation related to the Atos Medical acquisition

Capex

Capex is expected to be around DKK 1.4 billion and includes investments in automation at volume sites in Hungary and China as part of GOPS, investments in new machines for existing and new products, IT and sustainability investments, as well as Atos Medical capex and integration capex.

Effective tax rate

The effective tax rate is expected to be around 21%, positively impacted by the transfer of Atos Medical IP.

Other assumptions

The provision made to cover costs relating to transvaginal surgical mesh products remains subject to a degree of estimation.

Dividend policy

The Board of Directors intends to distribute excess liquidity to the shareholders through dividends and share buybacks.

The target payout ratio is 60-80% of net profit.

Atos Medical financial assumptions

The key financial assumptions for Atos Medical during the Strive25 strategy period are summarized below:

a) Organic growth is expected to be 8-10%, with an EBITDA margin in the mid-30s level
b) The transaction is expected to be increasingly EPS accretive from FY 2022/23. Estimated run-rate operational synergies of up to DKK 100 million from utilising Coloplast infrastructure, with full impact estimated from FY 2023/24
c) Capex integration costs of up to DKK 150 million split over 2021/22-2023/24, of which the vast majority will be IT capex
d) The acquisition is structured as a 100% cash payment financed through debt financing
e) The blended interest rate for the debt financing package is expected around 1.95% in FY 2022/23
f) Around 75% of the purchase value is treated as goodwill and 25% as intangibles, to be amortised over approximately 15 years
g) Around DKK 50 million integration cost in FY 2022/23, to be treated as special items, as expected

16

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Forward-looking statements

The forward-looking statements in this announcement, including revenue and earnings guidance, do not constitute a guarantee of future results and are subject to risk, uncertainty and assumptions, the consequences of which are difficult to predict.

The forward-looking statements are based on our current expectations, estimates and assumptions and are provided on the basis of information available to us at the present time.

Major fluctuations in the exchange rates of key currencies, significant changes in the healthcare sector or major developments in the global economy may impact our ability to achieve the defined long-term targets and meet our guidance. This may impact our company's financial results.

Exchange rate exposure

Our financial guidance for the 2022/23 financial year has been prepared on the basis of the following assumptions for the company's principal currencies:

OVERVIEW OF EXCHANGE RATES FOR KEY CURRENCIES AGAINST DKK

	GBP	USD	HUF
Average exchange rate 2020/21	852	622	2.08
Average exchange rate 2021/22	878	688	1.97
Change in average exchange rates for 2021/22 compared with the same period last year	3%	11%	-5%
Spot rate on 4 November 2022	854	762	1.83
Change in spot rates compared with average exchange rate 2021/22	-3%	11%	-7%

EFFECT OVER 12 MONTHS OF A $10\%$ INITIAL DROP IN EXCHANGE RATES FOR KEY CURRENCIES (DKK MILLION), EXCLUDING ATOS MEDICAL

	Revenue	EBIT
USD	-490	-220
GBP	-320	-220
HUF	-	130

Revenue is particularly exposed to developments in USD and GBP relative to DKK. Fluctuations in HUF against DKK impact the operating profit because a substantial part of our production, and thus of our costs, are in Hungary, whereas our sales there are moderate.

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Statement by the Board of Directors and the Executive Management

The Board of Directors and the Executive Management have today considered and approved the Annual Report of Coloplast A/S for the financial year 1 October 2021 – 30 September 2022.

The consolidated financial statements are prepared in accordance with International Financial Reporting Standards as adopted by the EU. In addition, the consolidated financial statements have been prepared in

accordance with additional Danish disclosure requirements for listed companies. The Management's report is also presented in accordance with Danish disclosure requirements for listed companies.

In our opinion, the consolidated financial statements give a true and fair view of the Group's assets, liabilities and financial position at 30 September 2022 and of the results of the Group's operations and cash flows for the

financial year 1 October 2021 – 30 September 2022.

Furthermore, in our opinion, the Management's report includes a fair account of the development and performance of the Group, the results for the year and of the financial position of the Group, together with a description of the principal risks and uncertainties that the Group and the parent company face.

Humlebæk, 7 November 2022

Executive Management

Kristian Villumsen
President, CEO

Anders Lonning-Skovgaard
Executive Vice President, CFO

Nicolai Buhl Andersen
Executive Vice President

Paul Marcun
Executive Vice President

Allan Rasmussen
Executive Vice President

Board of Directors

Lars Rasmussen
Chairman

Niels Peter Louis-Hansen
Deputy Chairman

Carsten Hellmann

Annette Brüls

Jette Nygaard-Andersen

Marianne Wiinholt

Thomas Barfod
Elected by the employees

Roland V. Pedersen
Elected by the employees

Nikolaj Kyhe Gundersen
Elected by the employees

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Statement of comprehensive income

1 October – 30 September, unaudited

| Consolidated
DKK million | Note | 2021/22
12 mths | 2020/21
12 mths | Index | 2021/22
Q4 | 2020/21
Q4 | Index |
| --- | --- | --- | --- | --- | --- | --- | --- |
| Revenue | 2 | 22,579 | 19,426 | 116 | 6,059 | 5,100 | 119 |
| Production costs | | -7,050 | -6,113 | 115 | -1,889 | -1,579 | 120 |
| Gross profit | | 15,529 | 13,313 | 117 | 4,170 | 3,521 | 118 |
| Distribution costs | | -6,797 | -5,485 | 124 | -1,872 | -1,454 | 129 |
| Administrative expenses | | -1,005 | -762 | 132 | -276 | -213 | 130 |
| Research and development costs | | -866 | -755 | 115 | -217 | -207 | 105 |
| Other operating income | | 74 | 73 | 101 | 15 | 16 | 94 |
| Other operating expenses | | -25 | -29 | 86 | -6 | -13 | 46 |
| Operating profit (EBIT) before special items | | 6,910 | 6,355 | 109 | 1,814 | 1,650 | 110 |
| Special items | 3 | -471 | -200 | - | -36 | - | - |
| Operating profit (EBIT) | | 6,439 | 6,155 | 105 | 1,778 | 1,650 | 108 |
| Financial income | 4 | 119 | 137 | 87 | -29 | 8 | <-200 |
| Financial expenses | 4 | -431 | -59 | >200 | -137 | -14 | >200 |
| Profit before tax | | 6,127 | 6,233 | 98 | 1,612 | 1,644 | 98 |
| Tax on profit for the period | | -1,421 | -1,408 | 101 | -382 | -339 | 113 |
| Net profit for the period | | 4,706 | 4,825 | 98 | 1,230 | 1,305 | 94 |
| Remeasurements of defined benefit plans | | 75 | -11 | | -17 | -16 | |
| Tax on remeasurements of defined benefit plans | | -19 | 3 | | 2 | 4 | |
| Items that will not be reclassified to the income statement | | 56 | -8 | | -15 | -12 | |
| Value adjustment of currency hedging | | 281 | -110 | | -62 | -29 | |
| Transferred to financial items | | 164 | -19 | | 28 | 24 | |
| Tax effect of hedging | | 11 | 28 | | 116 | 1 | |
| Currency adjustment of opening balances and other value adjustments relating to subsidiaries | | -409 | -11 | | -169 | -12 | |
| Tax effect of currency adjustment, assets in foreign currency | | -26 | -1 | | -26 | -1 | |
| Items that may be reclassified to income statement | | 21 | -113 | | -113 | -17 | |
| Total other comprehensive income | | 77 | -121 | | -128 | -29 | |
| Total comprehensive income | | 4,783 | 4,704 | | 1,102 | 1,276 | |
| DKK | | | | | | | |
| Earnings per share (EPS) | | 22.14 | 22.67 | | 5.79 | 6.13 | |
| Earnings per share (EPS), diluted | | 22.11 | 22.63 | | 5.79 | 6.12 | |

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Announcement no. 09/2022

07 November 2022

Colloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Statement of cash flows

1 October – 30 September

| Consolidated
DKK million | Note | 2021/22
12 mths | 2020/21
12 mths |
| --- | --- | --- | --- |
| Operating profit | | 6,439 | 6,155 |
| Amortisation | | 260 | 129 |
| Depreciation | | 670 | 663 |
| Adjustment for other non-cash operating items | 7 | 56 | -31 |
| Changes in working capital | 7 | -849 | -75 |
| Ingoing interest payments, etc. | | 16 | 31 |
| Outgoing interest payments, etc. | | -378 | -81 |
| Income tax paid | | -1,115 | -1,501 |
| Cash flows from operating activities | | 5,099 | 5,290 |
| Investments in intangible assets | | -208 | -1,047 |
| Investments in land and buildings | | -8 | -8 |
| Investments in plant and machinery and other fixtures and fittings, tools and equipment | | -41 | -102 |
| Investments in property, plant and equipment under construction | | -878 | -809 |
| Property, plant and equipment sold | | 11 | 36 |
| Investment in other investments | | -2 | -14 |
| Acquisition of subsidiaries | 10 | -10,633 | -97 |
| Net sales/purchase of marketable securities | | - | 30 |
| Cash flows from investing activities | | -11,759 | -2,011 |
| Free cash flow | | -6,660 | 3,279 |
| Dividend to shareholders | | -4,041 | -3,830 |
| Acquisition of treasury shares | | -500 | -500 |
| Sale of treasury shares and loss on exercised options | | -119 | 306 |
| Financing from shareholders | | -4,660 | -4,024 |
| Repayment of lease liabilities | | -239 | -202 |
| Financing through issuing long-term bonds | | 16,367 | - |
| Hedging gain | | 521 | - |
| Drawdown on credit facilities | | -5,398 | 1,050 |
| Cash flows from financing activities | | 6,591 | -3,176 |
| Net cash flows | | -69 | 103 |
| Cash and cash equivalents at 1 October | | 448 | 323 |
| Value adjustment of cash and bank balances | | 37 | 20 |
| Cash and cash equivalents, acquired operations | | -2 | 2 |
| Net cash flows | | -69 | 103 |
| Cash and cash equivalents at 30 September | 8 | 414 | 448 |

The cash flow statement cannot be derived using only the published financial data.

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Assets

At 30 September

Consolidated

DKK million	Note	30.09.22	30.09.21
Intangible assets		20,277	3,651
Property, plant and equipment		4,474	3,785
Right-of-use assets		677	601
Other equity investments		51	41
Deferred tax asset		674	743
Other receivables		31	26
Non-current assets		26,184	8,847
Inventories		3,187	2,428
Trade receivables		3,940	3,212
Income tax		336	282
Other receivables		383	226
Prepayments		293	172
Marketable securities		219	226
Cash and cash equivalents		414	448
Current assets		8,772	6,994
Assets		34,956	15,841

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Equity and liabilities

At 30 September

Consolidated

DKK million	Note	30.09.22	30.09.21
Share capital		216	216
Currency translation reserve		-914	-392
Reserve for currency hedging		415	-41
Proposed ordinary dividend for the year		3,185	2,979
Retained earnings		5,390	5,406
Equity		8,292	8,168
Provisions for pensions and similar liabilities		115	181
Provision for deferred tax		2,077	671
Other provisions	5	258	56
Bonds	6	16,359	-
Other payables		16	-
Lease liability		496	449
Prepayments		7	2
Non-current liabilities		19,328	1,359
Provisions for pensions and similar liabilities		6	15
Other provisions	5	347	150
Other credit institutions		1,644	2,160
Trade payables		1,242	1,036
Income tax		1,342	928
Other payables		2,544	1,840
Lease liability		209	177
Prepayments		2	8
Current liabilities		7,336	6,314
Equity and liabilities		34,956	15,841

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Statement of changes in equity, current year

At 30 September

Consolidated	Share capital		Reserves		Proposed dividend	Retained earnings	Total
DKK million	A shares	B shares	Currency translation	Currency hedging
2021/22
Equity at 1 October	18	198	-392	-41	2,979	5,406	8,168
Net profit for the period	-	-	-	-	4,247	459	4,706
Other comprehensive income	-	-	-518	456	-	139	77
Total comprehensive income	-	-	-518	456	4,247	598	4,783
Acquisition of treasury shares	-	-	-	-	-	-500	-500
Sale of treasury shares and loss on exercised options	-	-	-	-	-	-119	-119
Share-based payment	-	-	-	-	-	51	51
Tax on share-based payment, etc.	-	-	-	-	-	-50	-50
Interim dividend paid out in respect of 2021/22	-	-	-	-	-1,062		-1,062
Dividend paid out in respect of 2020/21	-	-	-	-	-2,979	-	-2,979
Transactions with shareholders	-	-	-	-	-4,041	-618	-4,659
Equity at 30 September	18	198	-910	415	3,185	5,386	8,292

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Statement of changes in equity, last year

At 30 September

Consolidated	Share capital		Reserves		Proposed dividend	Retained earnings	Total
DKK million	A shares	B shares	Currency translation	Currency hedging
2020/21
Equity at 1 October	18	198	-375	60	2,765	4,740	7,406
Net profit for the period	-	-	-	-	4,044	781	4,825
Other comprehensive income	-	-	-17	-101	-	-3	-121
Total comprehensive income	-	-	-17	-101	4,044	778	4,704
Acquisition of treasury shares	-	-	-	-	-	-500	-500
Sale of treasury shares	-	-	-	-	-	306	306
Share-based payment	-	-	-	-	-	50	50
Tax on share-based payment, etc.	-	-	-	-	-	32	32
Interim dividend paid out in respect of 2020/21	-	-	-	-	-1,065	-	-1,065
Dividend paid out in respect of 2019/20	-	-	-	-	-2,765	-	-2,765
Transactions with shareholders	-	-	-	-	-3,830	-112	-3,942
Equity at 30 September	18	198	-392	-41	2,979	5,406	8,168

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

List of notes

Key accounting policies

1. Accounting policies

Profit and loss

1. Segment information
2. Special items
3. Financial income and expenses

Assets and liabilities

1. Other provisions
2. Bonds

Cash flows

1. Specifications of cash flow from operating activities
2. Cash and cash equivalents

Other disclosures

1. Contingent liabilities
2. Acquisitions

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 1

Accounting policies

The financial statements in this report is prepared in accordance with International Financial Reporting Standards as adopted by the EU and additional Danish disclosure requirements for listed companies. The accounting policies for recognition and measurement applied in the preparation of the financial statements in this report are consistent with those applied in the Annual Report 2021/22.

Note 2

Segment information

Operating segments

The operating segments are defined on the basis of the monthly reporting to the Executive Leadership Team, which is considered the senior operational management, and the management structure. Reporting to the Executive Leadership Team is based on four operating segments: Chronic Care, Interventional Urology, Wound and Skin Care and Voice and Respiratory Care.

The operating segment Chronic Care covers the sale of ostomy care products and continence care products. The operating segment Interventional Urology covers the sale of urological products, including disposable products, as well as R&D activities. The operating segment Wound and Skin Care covers the sale of wound and skin care products and the operating segment Voice and Respiratory Care covers the sale of laryngectomy care products and tracheostomy products, as well as R&D activities.

The reporting segments are also Chronic Care, Interventional Urology, Wound and Skin Care and Voice and Respiratory Care. The segmentation reflects the structure of reporting to the Executive Leadership Team.

The shared/non-allocated comprises support functions (production units and staff functions) and eliminations, as these functions do not generate revenue. While costs of R&D activities for Interventional Urology and Voice and Respiratory Care are included in the segment operating profit/loss for that segment, R&D activities for Chronic Care and Wound and Skin Care are shared functions which are comprised in shared/non-allocated. The shared/non-allocated costs also include PPA amortisation expenditures related to Voice and Respiratory Care.

Financial items and income tax are not allocated to the operating segments.

The Executive Leadership Team reviews each operating segment separately, applying their market contributions to earnings and allocating resources on that basis. The market contribution is defined as external revenue less the sum of direct production costs, distribution costs, sales costs, marketing costs and administrative expenses. Costs are allocated directly to segments. Certain immaterial indirect costs are allocated systematically to the shared/non-allocated and the reporting segments.

The Executive Leadership Team does not receive reporting on assets and liabilities by the reporting segments. Accordingly, the reporting segments are not measured in this respect, nor do we allocate resources on this background. No single customer accounts for more than 10% of revenue.

26

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 2, continued

Consolidated DKK million	Chronic Care		Interventional Urology		Wound and Skin Care		Voice and Respiratory Care1)		Group
	2021/22	2020/21	2021/22	2020/21	2021/22	2020/21	2021/22	2020/21	2021/22	2020/21
Segment revenue:
Ostomy Care	8,620	7,841	-	-	-	-	-	-	8,620	7,841
Continence Care	7,643	7,003	-	-	-	-	-	-	7,643	7,003
Interventional Urology	-	-	2,424	2,097	-	-	-	-	2,424	2,097
Wound and Skin Care	-	-	-	-	2,689	2,485	-	-	2,689	2,485
Voice and Respiratory Care	-	-	-	-	-	-	1,203	-	1,203	-
External revenue as per the statement of comprehensive income	16,263	14,844	2,424	2,097	2,689	2,485	1,203	-	22,579	19,426
Costs allocated to segment	-6,677	-6,070	-1,564	-1,279	-1,600	-1,456	-820	-	-10,661	-8,805
Segment operating profit/loss	9,586	8,774	860	818	1,089	1,029	383	-	11,918	10,621
Shared/non-allocated									-5,008	-4,266
Special items not included in segment operating profit/loss (see note 3)									-471	-200
Operating profit before tax (EBIT) as per the statement of comprehensive income									6,439	6,155
Net financials									-312	78
Tax on profit/loss for the year									-1,421	-1,408
Profit/loss for the year as per the statement of comprehensive income									4,706	4,825

1) Only eight months recognised in 2021/22.

Note 3
Special items

DKK million	2021/22	2020/21
Provisions for litigation about transvaginal surgical mesh products	300	200
Expenses related to business combinations	171	-
Total	471	200

Special items contains expenses to cover further costs to resolve the remaining claims in connection with legal assistance related to litigation about transvaginal surgical mesh products as the process takes longer than previously anticipated. See note 5 to the financial statements for more information about the mesh litigation.

For 2021/22, special items also contain expenses and integration costs related to business combinations.

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 4

Financial income and expenses

DKK million	2021/22	2020/21
Financial income
Interest income	12	11
Fair value adjustments of forward contracts transferred from other comprehensive income	-	19
Fair value adjustments of cash-based share options	2	-
Interest hedges	27	-
Net exchange adjustments	57	95
Hyperinflationary adjustment of monetary position	19	11
Other financial income	2	1
Total	119	137
Financial expenses
Interest expenses	40	13
Interest expenses, lease liabilities	16	12
Interest expenses, bonds	116	-
Fair value adjustments of forward contracts transferred from other comprehensive income	191	-
Fair value adjustments of cash-based share options	-	2
Other financial expenses and fees	68	32
Total	431	59

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 5

Other provisions

Product liability case regarding transvaginal surgical mesh products

Since 2011, Coloplast, along with a number of other major manufacturers, has been named as a defendant in individual lawsuits in various federal and state courts around the United States alleging injury resulting from use of transvaginal surgical mesh products designed to treat pelvic organ prolapse and stress urinary incontinence. A multidistrict litigation (MDL) was formed in 2012 in the Southern District of West Virginia to consolidate federal court cases in which Coloplast is the first named defendant.

Since the first lawsuits were filed, Coloplast has been intent on disputing the current and any future litigation and has continually considered which strategy and other steps may serve the company's best interests.

Against this background, Coloplast has from the start reached settlements with groups of law firms. In 2017, Judge Joseph Goodwin issued a court order stating that plaintiffs may no longer direct claims against Coloplast in the ongoing MDL. In 2019, the remaining cases were remanded to the relevant Courts, and on 18 December 2020 the MDL was formally closed. It is estimated that around 99% of the former MDL cases have been settled to date.

An additional expense of DKK 0.3 billion has been recognised in Q2 2021/22 to cover further costs to resolve the remaining claims as the process takes longer than previously anticipated. The expense is recognised under special items in the income statement. The total amount recognised since the 2013/14 financial year for expected costs of litigation in the USA amounts to DKK 6.15 billion including legal costs (before insurance cover of DKK 0.5 billion).

The total expected expense is based on a number of estimates and assumptions and is therefore subject to uncertainty.

The remaining provision made for legal claims amounted to DKK 0.2 billion at 30 September 2022 (DKK 0.2 billion at 30 September 2021) plus DKK 0.3 billion recognised under other debt (DKK 0.1 billion at 30 September 2021). Liabilities are classified as other debt when agreements are reached with the plaintiffs' legal counsel and amounts and timing become known.

With reference to the prejudicial exemption in IAS 37, Coloplast will not disclose any further information about the assumptions for the provision, including any details about current and the expected number of lawsuits and settled claims.

The disclosure of such information is believed to be detrimental to Coloplast in connection with the ongoing confidential negotiations and could inflict financial losses on Coloplast and its shareholders.

29

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 6

Bonds

Coloplast has in 2021/22 raised EUR 2.2 billion in debt financing through the issuance of senior unsecured notes in an aggregate principal amount of EUR 2.2 billion under the Coloplast Euro Medium Term Note programme. The Notes are unconditionally and irrevocably guaranteed by Coloplast. COLOCB1 Floating Rate Note carries a coupon adjusted quarterly. COLOCB2 carries a fixed coupon for five years, and COLOCB3 carries a fixed coupon for eight years.

COLOCB2 and COLOCB3 can be redeemed at a market price fixed on the redemption date in relation to named EUR bonds with similar maturity

A pre-hedge was made with Interest swaps on COLOCB2 and COLOCB3 with mandatory breakage on the day the bonds are issued to limit the financial risks. The gain of DKK 521 million has as per hedge accounting been set off in the equity and transferred to the financial items during the lifetime of the bonds.

Short name	Currency	Amount, million	Expiry date	Coupon^{1)}
COLOCB1	EUR	650	19-05-2024	1,10
COLOCB2	EUR	850	19-05-2027	2.25
COLOCB3	EUR	700	19-05-2030	2.75

1) Fixed for COLOCB1 as per 17-08-2022. The coupon rate is set as 3M Euribor + 0.75%.

Note 7

Specifications of cash flow from operating activities

DKK million	2021/22	2020/21
Net gain/loss on divestment of non-current assets	7	4
Change in other provisions	-3	-85
Other non-cash operating items	52	50
Adjustment for other non-cash operating items	56	-31
Inventories	-540	-161
Trade receivables	-351	-235
Other receivables, including amounts held in escrow	-295	97
Trade and other payables etc.	337	224
Changes in working capital	-849	-75

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 8

Cash and cash equivalents

DKK million	2022	2021
Bank deposits, short term	414	448
Cash and cash equivalents at 30 September	414	448

Note 9

Contingent liabilities

Other than as set out in note 5, the Coloplast Group is a party to a few minor legal proceedings, which are not expected to influence the Group's future earnings.

Note 10

Acquisitions

On 31 January 2022, Coloplast completed the acquisition of all shares and voting rights of Atos Medical at a cash consideration of DKK 10,622 million.

About Atos Medical

Atos Medical is the global market leader in laryngectomy. Laryngectomy is a chronic business that fits into Coloplast's mission, vision and values. Atos Medical's purpose of making life easier for people living with a neck stoma is closely aligned with Coloplast's purpose of making life easier for people with intimate healthcare needs. The Atos Medical group serves customers in around 90 countries and a direct presence in 30 countries across the world. Atos Medical employs about 1,200 employees.

Strategic rationale

The transaction represents a new long-term growth category for Coloplast operating with its own identity, brand and execution strength while benefitting from the industry leading capabilities and track record of Coloplast to drive continuous growth and value creation. The acquisition of Atos Medical adds therefore a new long-term growth compounder in a category with significant untapped market potential. Following the acquisition, Coloplast gains access to a new chronic care segment to be run as a separate strategic business unit operating on shared Coloplast infrastructure.

Goodwill recognised mainly related to the expertise and knowhow of the acquired workforce and expected synergies from the integration to Coloplast Group. Recognised goodwill is non-deductible for tax purposes.

Transaction and integration costs

In 2021/22, Coloplast incurred transaction and integration costs relating to the acquisition of DKK 171 million, which has been recognised under special items in the statement of comprehensive income. Transaction costs accounts for DKK 95 million.

Fair value of acquired net assets and recognised goodwill

The fair value of the acquired net assets has been identified and goodwill recognised. Net assets, goodwill and contingent assets and liabilities recognised at the reporting date are to some extent still provisional. Adjustments may be applied to the purchase price allocation for a period of up to 12 months from the acquisition date in accordance with IFRS 3.

The main categories of net assets, for which acquisitional accounting is still ongoing, are mainly related to other provisions and deferred tax assets.

31

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 10, continued

DKK million	Fair value at date of acquisition (31.01.2022)
Assets identified at fair value:
Customer relationships	2,427
Patents and trademarks	4,699
Software	23
Tangible assets (under construction)	29
Property, plant and equipment	218
Right-of-use assets	74
Deferred tax assets	45
Inventories	151
Trade receivables	248
Other receivables	73
Cash and cash equivalents	-
Total assets	7,987
Liability identified at fair value:
Lease liabilities	76
Borrowings	4,990
Provisions	407
Corporate tax	48
Trade payables	60
Other payables	310
Deferred tax liability	1,513
Total liability	7,404
Total net assets acquired	583
Goodwill	10,039
Purchase price	10,622
Acquired cash	-
Cash flow used for acquisition of subsidiaries	10,622

Intangible assets consist of customer lists (DKK 2,427 million) and patents and trademarks (DKK 4,699 million). Customer lists consist of access to Atos's existing customer base (users) and physician lists. Patents and trademarks consist of the Atos trademark and name. Receivables represent a gross amount of DKK 321 million and have only been subject to insignificant writedowns.

After recognition of identifiable assets and liabilities at fair value, goodwill related to the acquisition amounts to DKK 10,039 million, which is not deductible for tax purposes.

32

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Announcement no. 09/2022
07 November 2022
Coloplast
Ostomy Care
Continence Care
Wound and Skin Care
Interventional Urology
Voice and Respiratory Care

Note 10, continued

Earnings impact

We have initiated the operational and legal integration of Atos Medical, while focusing on maintaining a high service level towards our customers in the transition phase.

Atos Medical is recognised in consolidated net revenue at DKK 1,203 million and in consolidated operating profit before special items at DKK 231 million, which also includes around DKK 152 million in PPA amortisation costs. If the acquisition had occurred on 1 October 2021, consolidated pro-forma revenue and operating profit before special items for the period ended 30 September 2022 of the combined Group would have been approximately DKK 23,165 million and DKK 7,000 million, respectively.

The Atos Medical activities will be presented as a new operating segment for the Coloplast Group.

Fair value measurement

Material net assets acquired for which significant estimates have been applied in the fair value assessment have been recognised using the following valuation techniques:

Customer relationships

Customer relationships have been measured using an income-based method (MEEM), by which the present value of future cash flows from recurring contract customers expected to be retained after the date of acquisition has been valuated using a WACC of 6.7% as discount rate. In total, customer relationships amounting to DKK 2,427 million have been included in the opening balance. The main input value drivers in the MEEM model used are the estimated future retention rate and net cash flow of the acquired contract customer base. These inputs have been estimated based on Management's professional judgement from analysis of the acquired customer base, historical data and general business insight.

Patents and trademarks

Technology has been measured by applying the income-based (relief from royalty) method to the revenue stream. The discount rate applied is 6.7% which is deemed a fair reflection of the risk comprised in the technology.

The corporate trademarks, Atos and TRACOE, are measured by applying the income-based (relief from royalty) method to the revenue stream. The estimated royalty rate of 6.0% is based on the average of the comparable licence contracts. The discount rate applied is 6.7% which is deemed a fair reflection of the risk comprised in the corporate trademarks.

Provisions

The provisions are related to Atos Medical Inc. (US) which is on a regular basis subject to public audits regarding billing compliance. It is assessed that these audits are associated with a material risk of recoupment and based on the preliminary high-level analysis the maximum exposure was estimated to around DKK 500 million at the acquisition date. The exposure and the related provision has been reassessed at the end of the financial year 2021/22 which lead to an adjustment so the provision at 30 September 2022 amounts to DKK 400 million.

Trade receivables and payables

Fair value of trade receivables and trade payables has been measured at the contractual amount expected to be received or paid. In addition, collectability has been taken into consideration on trade receivables. The amounts have not been discounted, as maturity on trade receivables- and payables generally is very short and the discounted effect therefore immaterial.

Financial liabilities

Lease liabilities have been measured at the present value of the remaining lease payments at the acquisition date discounted using an appropriate incremental borrowing rate.

33

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Note 10, continued

Borrowings

Borrowings have been measured at the present value of the repayable amounts discounted using a representative borrowing rate, unless the discount effect is insignificant.

Other

In addition to the above Coloplast has during Q2 acquired 100% of the shares and voting rights in a small French direct-to-consumer Durable Medical Equipment (DME) dealer, Mercure Medical. The acquisition is expected to expand Coloplast' footprint in Paris, France.

The fair value of net assets acquired is identified and recognised. The purchase price is recognised as intangible assets. The agreed consideration for the shares amounts to EUR 1.5 million (DKK 11 million), which fell due for payment on the date of the acquisition.

34

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Income statement, quarterly

Unaudited

Consolidated		2021/22			2020/21
DKK million	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1
Revenue	6,059	5,849	5,502	5,169	5,100	4,835	4,753	4,738
Production costs	-1,889	-1,801	-1,721	-1,639	-1,579	-1,500	-1,502	-1,532
Gross profit	4,170	4,048	3,781	3,530	3,521	3,335	3,251	3,206
Distribution costs	-1,872	-1,813	-1,620	-1,492	-1,454	-1,396	-1,325	-1,310
Administrative expenses	-276	-270	-264	-195	-213	-189	-175	-185
Research and development costs	-217	-222	-222	-205	-207	-185	-177	-186
Other operating income	15	30	15	14	16	32	10	15
Other operating expenses	-6	-12	-4	-3	-13	-5	-7	-4
Operating profit (EBIT) before special items	1,814	1,761	1,686	1,649	1,650	1,592	1,577	1,536
Special items	-36	-20	-381	-34	-	-	-200	-
Operating profit (EBIT)	1,778	1,741	1,305	1,615	1,650	1,592	1,377	1,536
Financial income	-29	79	50	19	8	44	67	18
Financial expenses	-137	-149	-68	-77	-14	-17	31	-59
Profit before tax	1,612	1,671	1,287	1,557	1,644	1,619	1,475	1,495
Tax on profit for the period	-382	-382	-307	-350	-339	-365	-345	-359
Net profit for the period	1,230	1,289	980	1,207	1,305	1,254	1,130	1,136
DKK
Earnings per share (EPS) before special items	5.92	6.14	6.00	5.80	6.13	5.89	6.04	5.34
Earnings per share (EPS)	5.79	6.07	4.61	5.67	6.13	5.89	5.31	5.34
Earnings per share (EPS) before special items, diluted	5.92	6.13	5.99	5.78	6.12	5.88	6.03	5.33
Earnings per share (EPS), diluted	5.79	6.06	4.60	5.66	6.12	5.88	5.30	5.33

---

Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Five-year financial highlights and key ratios

Income statement, DKK million	2021/22	2020/21	2019/20	2018/19	2017/18
Revenue	22,579	19,426	18,544	17,939	16,449
Research and development costs	-866	-755	-708	-692	-640
Operating profit before interest, tax, depr. and amort. (EBITDA)	7,369	6,947	6,705	5,807	5,716
Operating profit before interest, taxes and amortization (EBITA) before special items	7,170	6,484	6,013	5,707	5,248
Operating profit (EBIT) before special items	6,910	6,355	5,854	5,556	5,091
Special items	-471	-200	-	-400	-
Operating profit (EBIT)	6,439	6,155	5,854	5,156	5,091
Net financial income and expenses	-312	78	-388	-128	-82
Profit before tax	6,127	6,233	5,466	5,028	5,009
Net profit for the year	4,706	4,825	4,197	3,873	3,845
Revenue growth
Annual growth in revenue, %	16	5	3	9	6
Growth breakdown:
Organic growth, %	6	7	4	8	8
Currency effect, %	4	-2	-1	1	-4
Acquired operations, %	6	0	-	0	1
Other matters, %	-	-	-	-	1
Balance sheet, DKK million
Total assets	34,956	15,841	13,499	12,732	11,769
Capital invested	27,679	11,576	9,864	8,748	8,468
Net interest-bearing debt	18,091	2,112	1,162	539	754
Equity at year end	8,292	8,168	7,406	6,913	6,418
Cash flows and investments, DKK million
Cash flows from operating activities	5,099	5,290	4,759	4,357	4,361
Cash flows from investing activities	-11,759	-2,011	-901	-591	-947
Investments in property, plant and equipment, gross	-927	-919	-846	-617	-616
Free cash flow	-6,660	3,279	3,858	3,766	3,414
Cash flows from financing activities	6,591	-3,176	-3,857	-3,714	-3,430
Key ratios
Average number of employees, FTEs	13,650	12,578	12,250	11,821	11,155
Operating margin (EBIT margin) before special items, %	31	33	32	31	31
Operating margin (EBIT margin), %	29	32	32	29	31
Operating margin before interest, tax, depr. and amort. (EBITDA margin), %	33	36	36	32	35
Gearing ratio, NIBD/EBITDA before special items	2.3	0.3	0.2	0.1	0.1
Return on average invested capital before tax (ROIC), %1)	35	58	59	62	57
Return on average invested capital after tax (ROIC), %1)	27	45	46	48	44
Return on equity, %	64	70	66	65	72
Equity ratio, %	24	52	55	54	55
Net asset value per outstanding share, DKK	39	38	35	33	30
Share data
Share price, DKK	776	1,007	1,004	825	657
Share price/net asset value per share	20	26	29	25	22
Average number of outstanding shares, in million	213	213	213	212	212
PE, price/earnings ratio	35	44	51	45	36
Dividend per share, DKK2)	20.0	19.0	18.0	17.0	16.0
Payout ratio, %3)	84	81	91	86	88
Earnings per share (EPS), diluted	22.11	22.63	19.67	18.18	18.10
Free cash flow per share	-31	15	18	18	16

Key ratios have been calculated and applied in accordance with Recommendations and Financial Ratios issued by the Danish Society of Financial Analysts.

1) This item is provided before special items. After special items, ROIC before tax was
33\% / 57\% / 61\% / 60\% / 62\%
3) and ROIC after tax was
25\% / 44\% / 47\% / 46\% / 47\%

2) The figure shown for the 2021/22 financial year is the proposed dividend.

3) For the 2021/22, 2020/21 and 2018/19 financial years, this item is before special items. After special items, the payout ratio is
90\% / 84\% / 93\%
.

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Announcement no. 09/2022

07 November 2022

Coloplast

Ostomy Care

Continence Care

Wound and Skin Care

Interventional Urology

Voice and Respiratory Care

Our mission

Making life easier for people

with intimate health care needs

Our values

Closeness... to better understand

Passion... to make a difference

Respect and responsibility... to guide us

Our vision

Setting the global standard

for listening and responding

For further information, please contact

Investors and analysts

Anders Lonning-Skovgaard

Executive Vice President, CFO

Tel. +45 4911 1111

Aleksandra Dimovska

Director, Investor Relations

Tel. +45 4911 1800 / +45 4911 2458

Email: dkadim@coloplast.com

Kristine Husted Munk

Senior Manager, Investor Relations

Tel. +45 4911 1800 / +45 4911 3266

Email: dkkhu@coloplast.com

Press and media

Peter Mønster

Sr. Media Relations Manager

Tel. +45 4911 2623

Email: dkpete@coloplast.com

Address

Coloplast A/S

Holtedam 1

DK-3050 Humlebaek

Denmark

Company reg. (CVR) no. 69749917

Website

www.coloplast.com

This announcement is available in a Danish and an English-language version. In the event of discrepancies, the English version shall prevail.

Coloplast develops products and services that make life easier for people with very personal and private medical conditions. Working closely with the people who use our products, we create solutions that are sensitive to their special needs. We call this intimate health care. Our business includes Ostomy Care, Continence Care, Wound and Skin Care, Interventional Urology and Voice and Respiratory Care. We operate globally and employ more than 14,500 employees.

The Coloplast logo is a registered trademark of Coloplast A/S. © 2022-11.

All rights reserved Coloplast A/S, 3050 Humlebaek, Denmark.

Coloplast A/S

Holtedam 1

DK-3050 Humlebaek

Denmark

Investor Relations

Tel. +45 4911 1800

Fax +45 4911 1555

www.coloplast.com

Comp. reg. (CVR).

69749917