There is no single, exhaustive headline that describes 2022. We went into the year full of optimism and with an ambitious plan, and once again, we experienced first-hand how our ability to adapt to global changes is crucial for the continuous operation and development of our company. Despite headwind from a challenging macroeconomic  environment and supply chain situation, we delivered top-line growth of 10%, which is less than originally expected, but still a solid performance under tough conditions and indeed a testament to the strength of our organisation, people and culture. 

The year started on a high note: After a strong and solid 2021, we had every reason to have high expectations for 2022. Most of the world opened again, the recovery after coronavirus took off, which made it possible for us to travel and meet each other again after almost two years of isolation, and seeing our customers, shareholders and employees in real life again has been one of the highlights of the year.  

Our company is also driven by people’s interaction. To communicate, to interact with people and to listen to each other are crucial elements in all our hearing healthcare and communication solutions that enable individuals to interact freely with the surrounding world. 

Market share gains 
Early in the year, the good momentum lost pace. Global stability, which companies normally rely on, suffered further under the war in Ukraine and under the macroeconomic uncertainty and declining consumer confidence that followed. Unfortunately, this uncertainty had an impact on our results, as both industries in which we operate – hearing healthcare and audio technology – were negatively impacted, albeit to varying degrees.  

Given the difficult hearing healthcare market, we did well. Our core Hearing Healthcare segment grew, and our Diagnostics and Hearing Aids business areas both gained market shares. Even with the global challenges, we showed a unique ability to mitigate disruptions to our supply chain, and our set-up with proximity to the market and the customers has proven valuable. 

As great as 2021 was for our Diagnostics business area, 2022 shaped up to be even better. The results speak for themselves, and one of the underlying mechanisms driving the good performance has been our work in training and education in diagnostic methods and hearing treatment. 

Paradigm-shifting technology 
Time and again, we have proven that our technology is unique and life-changing for our users. With our balance equipment, we diagnose and provide treatment for vertigo and thus offer people suffering from dizziness rehabilitation and thus the possibility to live a normal life.  

In Hearing Aids, our innovative audiology platform continues to set new standards, accentuated by the open sound landscape – the hearing aids give access to the whole sound image even in noisy environments –which is still a “user first choice”. Our customers have benefitted from it year after year, not least with the latest hearing aid platform, which was expanded in 2022 by a complete line of custom in-the-ear devices. In a highly competitive hearing aid market, our Hearing Aids business area has done well, and we remain committed to continuing to improve our products with paradigm-setting technology.

Data create insight 
When we talk about our core technology, we do it with a great deal of confidence, but what can we say will be next? In our new families of premium hearing aids, which will be launched shortly, we will go one step further and offer the optimal sound image for hearing aid users by reducing sudden disruptive sounds and in doing so making the open sound hearing experience more comfortable, focused and sharp. A key technological theme is how we use data to gain insight and understanding, and – more importantly – how we use such data to improve the treatment of hearing loss and nudge users to get the most out of their solutions.  

Difficult market conditions 
In Communications, our premium solutions are also built on state-of-the-art technology, and we continue our R&D efforts even in a tough year. We have been impacted by a challenged supply chain and a significantly challenged gaming market, which is why this part of our business did not live up to the growth expectations we communicated at the beginning of the year. However, we remain dedicated to developing EPOS and helping it prosper in enterprise and gaming solutions. 

Growth and expansion have also been important themes for our Hearing Care business area in the past year despite weak market conditions and overall performance for the year below our expectations. On the positive side, we have taken an important strategic step in China with the acquisition of the Sheng Wang chain. In a country where the hearing healthcare infrastructure is still at an early stage, Demant's hearing healthcare businesses are now well positioned for future growth in China, which enables us to help even more people hear better. 

Decision to discontinue 
In early 2022, we communicated our decision to discontinue our Hearing Implants business area. Following a careful strategic review, we concluded that becoming a global leader in hearing implants by providing the best hearing implants for the benefit of both patients and customers was no longer achievable for us. While the Oticon Medical divestment process continues into 2023, we insist on ensuring the best life-long support for existing patients – now and in the future. 

Importance of personal care 
A key topic in our industry this year has been the approval by the US Food and Drug Administration of the over-the-counter (OTC) category of hearing aids in the US. While we fully support expanding the access to hearing healthcare, we remain convinced that the involvement of an expert between a person with hearing loss and the appropriate treatment is the best solution for treating hearing loss most efficiently. We continue to analyse this market in terms of value both for the user and for Demant. 

Transition to net zero 
The world is full of technology that makes everyday life better in a sustainable way – in terms of both sustainable health solutions and climate sustainability. In 2022, we have taken an important step in the global transition to net zero by integrating our climate strategy into our business and operations. We have launched projects that support our reduction targets in all scopes, and based on this, we have submitted our goals to halve our CO2 emissions by 2030 and reach net zero by 2050 to the Science Based Target Initiative. In 2023, we welcome their validation. 

An inclusive workplace 
Diversity, equity and inclusion were other important sustainability focus areas for us in 2022. With new ambitions and goals, mainly focusing on gender balance, we have throughout the year taken actions to create a workplace where everyone feels that they belong, and for the entire Group, we work with leadership training and on identifying any processes that may stand in the way of creating a diverse and inclusive workplace. 

Finally, I would like to take this opportunity to say a heartfelt thank you to our customers, to our employees and to the shareholders in Demant. Thank you for helping us create life-changing hearing health in 2022. Despite a very dynamic business environment in the past year and no doubt also in 2023, I see many reasons to look towards 2023 with optimism. 

Søren Nielsen