Lars Rasmussen – CEO
Anders Lonning-Skovgaard – CFO
Veronika Dubajoba – Goldman Sachs
Patrick Wood – Bank of America Merrill Lynch
Chris Gretler – Credit Suisse
Michael Jungling – Morgan Stanley
Ian Douglas-Pennant – UBS
Yi-Dan Wang – Deutsche Bank
Christian Ryom – Nordea
Oliver Metzger – Commerzbank
Kit Lee – Jefferies
Annette Lykke – Handelsbanken
Good afternoon, and welcome to our Q3 2017-2018 Conference call. My name is Lars Rasmussen. I am CEO of Coloplast, and I’m joined by CFO, Anders Lonning-Skovgaard, and our Investor Relations team. We will start with a short presentation by Anders and myself, and then we will take questions.
Please turn to Slide number 3. I’m very pleased with today’s results. We have now developed 5 consecutive quarters of 8% growth in the market that is growing 4% to 5%. This speaks to the solid underlying performance across the business and our ability to consistently take market shares. Growth continues to be driven by ability — by the launch of new innovative products like SenSura Mio Convex and SpeediCath Flex and strong commericial execution.
In November last year, we made the decision to increase our investments into sales enhancing initiatives, and we continue to see an initial return on these investments which I’m very pleased with.
Based on the expectations of a limited impact from the SpeediCath patent expiry, we have upgraded our organic growth guidance for the year from 7% to 8% to around 8%. Our guidance in Danish kroner is unchanged at around 6%. Our EBIT margin guidance is unchanged in fixed currencies at 31% to 32% and in Danish kroner at around 31%.
Our group strategy is centered around delivering profitable growth. We continue to make progress on our unparalleled efficiency agenda. And this quarter, we completed our plan to reduce the number of production employees in Denmark from 700 to 400. We have also accelerated the closure of our factory in Thisted, meaning that the restructuring cost will be higher this financial year than expected. Anders will walk you through this in detail later.
I’m pleased to announce that we have appointed a new leader for our Emerging Markets region. Andrew Robinson joins us on October 1, 2018 from Alcon, a Novartis company where he has been leading more than 1,000 cross-functional employees in their Asia-Pacific region.
On September 18, we will host a Capital Markets Day at our headquarters in Humlebaek in Denmark focusing on innovation and commercial initiatives to drive growth. I look forward to welcoming many of you to Humlebaek.
Please turn to Slide number 4. Year-to-date, our revenues grew 8% organically and 6% Danish kroner and amounted to DKK 12 billion. The acquisition of Comfort Medical and Lilial contributed approximately 1 percentage points to reported growth. In Ostomy Care, organic growth was 9% year-to-date and growth in Danish kroner was 5%. For Q3 in isolation, organic growth was 7%. Growth continues to be driven by our SenSura Mio and Brava accessories portfolios in larger markets like the U.K., Germany and the U.S. SenSura Mio Convex continues to contribute strongly to growth.
Our SenSura and Assura/Alterna portfolio growth was driven by satisfactory performance in markets like China, Argentina and Brazil. And growth continues to be negatively impacted by the Greek price reform. Overall, growth in Emerging Markets was weaker in Q3 compared to the first 2 quarters due to timing effects. More specifically, we have won several tenders that we will deliver in Q4.
We continue to receive positive feedback from healthcare professionals and users who have trialed our new ostomy appliance SenSura Mio Concave. We have now secured reimbursement and launched the new product portfolio in 9 countries. Clinical studies have demonstrated that SenSura Mio Concave is superior with respect to the key clinical parameters, including superior body fit, preference and quality of life. We are proud to be introducing this new product category to end users.