Sonova : Präsentation FY 2023/24 (nur Englisch)

Full Year Results 2023/24

Arnd Kaldowski, CEO

Birgit Conix, CFO

Stäfa, May 14, 2024

Disclaimer

This presentation contains forward-looking statements, which offer no guarantee with regard to future performance. These statements are made on the basis of management's views and assumptions regarding future events and business performance at the time the statements are made. They are subject to risks and uncertainties including, but not confined to, future global economic conditions, exchange rates, legal provisions, market conditions, activities by competitors and other factors outside Sonova's control. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual outcomes may vary materially from those forecasted or expected. Each forward-looking statement speaks only as of the date of the particular statement, and Sonova undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law.

This presentation constitutes neither an offer to sell nor a solicitation to buy any securities. This presentation does not constitute an offering prospectus within the meaning of Article 652a of the Swiss Code of Obligations nor a listing prospectus within the meaning of the listing rules of SIX Swiss Exchange.

Sonova name, products names and logos are registered trademarks of Sonova.

Sennheiser is a registered trademark of Sennheiser electronic GmbH & Co. KG used under license by Sonova.

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FY 2023/24 Business Review

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Summary FY 2023/24

• Hearing care markets back to historical growth rates, despite regional differences
• Growth picking up in 2H, with year ending on a positive note
• • HI and CI business with significant sales acceleration in 2H - AC business posting strong YOY growth
  • Difficult consumer electronics markets and temporary gap in product portfolio weighing on CH business
• Positive customer feedback and expanded Lumity portfolio supporting growth in HI business
• Significant exchange rate movements weighing heavily on results - positive impact currently expected for FY 2024/25
• Laid the foundation for continued growth in FY 2024/25 - high focus on technology innovation with expansion of processing power and augmentation of algorithms at the core

Sonova Group results

Key highlights - FY 2023/24

Sales

CHF 3,627 m

+3.2% in LC

-3.0% in CHF

organic growth +1.6% or +3.2%

excluding non-renewal of large contract

EPS (adj.)

CHF 10.06 per share

+6.4% in LC

-9.6% in CHF

Sales outlook

+6 - 9%

growth in LC

in FY 2024/25

EBITA (adj.)

CHF 771.4 m

+4.4% in LC

-8.2% in CHF

(Margin +25bps in LC)

Note: adj. refers to adjusted figures; for details, please refer to the Appendix.

Acceleration HI business

Lumity platform

expanded

and well prepared for a significant launch year

EBITA (adj.) outlook

+7 - 11%

growth in LC

in FY 2024/25

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Sonova Group results

Business summary

Hearing

Instruments

(HI)

Audiological

Care

(AC)

Consumer

Hearing

(CH)

Cochlear

Implants

(CI)

• Sales of CHF 1,697.7 million - organic growth of +0.7% in LC and +4.0% in LC adjusted for large US contract
• Realized expected acceleration in the second half as temporary challenges were resolved
• Reliability and customer care significantly improved, resulting in positive customer feedback - now focused on upcoming platform launch
• Sales of CHF 1,410.5 million - strong performance with sales growth of +9.2% in LC
• Good organic growth of +4.7% in LC driven by strong performance in most EU markets - positive M&A impact of +4.5%
• Continued to expand consumer access - CHF 100 million invested into bolt-on acquisitions
• Sales of CHF 239.7 million down -9.3% in LC - continued weak demand in consumer electronics market
• Temporary gap in availability of a key product due to inconsistent battery performance from a now deselected supplier
• Continued new product launches and entry into the emerging OTC market in the US
• Sales of CHF 278.9 million, up +3.6% in LC - strong improvement of momentum in second half
• System sales up +6.8% in LC supported by a continued market improvement and good sales execution
• Upgrades and accessories down -2.1% in LC - installed base of recipients waiting for an upgrade to Marvel is tapering off

• Sales growth accelerating in the second half mainly driven by improved momentum in Hearing Instruments

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Hearing Instruments segment

Highlights

Sales	EBITA (adj.)
CHF 3,348m	CHF 736m
+3.2% vs. PY in LC	+4.5% vs. PY in LC
+1.5% organic growth	Margin: 22.0%
	Margin YOY: +30bps in LC

Segment sales

• Development supported by improving hearing care market - fundamentals back to normal
• Organic growth accelerating in second half, driven by HI business
• Strong growth in AC business supported by majority of EU countries and M&A

HI business	AC business	CH business
Sales:	Sales:	Sales:
CHF 1,698m	CHF 1,411m	CHF 240m
+0.7% vs. PY in LC*	+9.2% vs. PY in LC	-9.3% vs. PY in LC
	+4.7% organic growth

• +4.0% excl. non-renewal of contract with large US customer

Segment profitability

• Margin expansion by +30bps in LC, despite higher go-to-market investments to drive sales in 2H
• Gradual easing of transport and component costs
• Residual positive pricing impacts from prior year initiatives

Note: adj. refers to adjusted figures; for details, please refer to the Appendix.

• Organic growth accelerated in 2H - Margin expansion of +30bps in LC despite higher GTM investments

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Hearing Instruments business

Sales dynamics

HI business sales: CHF 1,698m

+0.7% vs. PY in LC*

• +4.0% excl. non-renewal of contract with large US customer

• Organic growth accelerated to +6.0% in LC in 2H, development in 1H held back by previous year non-renewal of large contract
• Substantial further reliability improvement supporting HCP efficiency and resulting in strong positive customer feedback
• Temporary operational challenges resolved and pro-activelycommunicated to our customers
• Strong focus on driving success of Lumity portfolio expansion in Q4

• Strong pick-up in momentum in 2H - Customer confidence restored

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Hearing Instruments business

Net promoter score and Lumity repair rates

Net Promoter Score - 3-months rolling

50		+19 pts improvement
45
40
35
30
25
20
15
10
5
0
Mar-23	Apr-23May-23Jun-23Jul-23Aug-23Sep-23Oct-23Nov-23Dec-23Jan-24Feb-24Mar-24Apr-24

Rolling 3 Month NPS

• Strong customer feedback as measured by Net Promoter Score (NPS) in 4 largest markets
• Focused investments and process improvements yielding targeted significant improvements

Failure rate (Audéo R & RT models)

+30% better

+30% better

Paradise	Lumity	Lumity
	(@ launch)	(today)

• Designing for reliability - strong processes and development testing setup
• Continued investment in reliability to further improve customer satisfaction and service costs
• Further 30% reduction in failure rates of current Lumity models compared to already improved Lumity at launch

• Strong customer feedback and significant improvement in product reliability even in year 2 of Lumity

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Innovation as driver for meaningful differentiation

Building on our core competency: improving quality of life for our customers and consumers

R&D Investments

FY 18/19FY 23/24

	+60%
CHF	CHF
148m	236m

Future

Expansion of processing power & data processing, as well as improved algorithms

Focus on better hearing and elevated ease of use

• Strong focus on technological innovation to drive significantly improved hearing performance