(Adds detail, background)
* Expects to outgrow the market
* Sees 2013 EBIT above 2012
* Plans share buyback
COPENHAGEN, Feb 26 (Reuters) - Danish hearing aid maker William Demant expects to grow market share this year thanks to a new high-end device, after its 2012 results missed expectations on sluggish sales and falling profit margins.
The firm, which has struggled with an ageing product mix, hopes several new products launched this year - particularly the Oticon Alta - will make up for a weak close to 2012, as initial market reaction has been positive, it said on Tuesday.
“In 2013, we expect organic revenue growth in our wholesale of hearing aids to exceed market growth rates by 3-5 percentage points in local currencies and thus expect to continue to increase our market share,” the firm said.
“In 2013, corporate operating profit is expected to exceed the level realised in 2012.”
The firm ended 2012 on a weak note, missing its already lowered guidance as rivals, like GN Store and Sonova lured customers away with newer products.
For the full year, William Demant’s operating profit fell to 1.65 billion Danish crowns ($292.2 million) from 1.71 billion the year before, missing analysts’ expectation for 1.7 billion.
William Demant shares, down 3 percent over the last 12 months, are valued below peers, reflecting uncertainty whether its new products will help to restore its fortunes.
It trades at an enterprise value to EBIDTA (earnings before interest, tax, depreciation and amortisation) of around 12.5-13, below GN Store’s 13-13.5 and Sonova’s ratio above 14.
To improve shareholder returns, it plans to buy back shares using surplus cash flow and keep net interest-bearing debt at around 1.5-2.0 billion crowns.
$1 = 5.6464 Danish crowns Reporting by Balazs Koranyi; Editing by Mark Potter