Swedish health and hygiene company, Essity, announced a strong third-quarter performance on Thursday, with a 16.1% increase in net sales to SEK 130,372m ($14.6bn), fueled by organic growth and acquisitions. The operating profit before amortization (EBITA) rose by 74% to SEK 12,323m ($1.38bn), while adjusted EBITA increased significantly by 60% to SEK 14,372m ($1.61bn), enhancing the adjusted EBITA margin.
CEO Magnus Groth attributed the robust earnings to higher selling prices, cost savings, an improved product mix, and lower costs for raw materials, energy, and distribution. All business areas - Professional Hygiene, Incontinence Products Health Care, and Baby Care - registered growth with higher sales and improved adjusted EBITA margin. Operating cash flow surged by 182% to SEK 7.5bn ($840m).
The company is currently reviewing its ownership in Vinda and Consumer Tissue Private Label Europe to reduce the latter's share of total sales. Despite lower volumes due to restructuring measures and exiting contracts with insufficient profitability, sales growth was 4.6%.
As part of its commitment to sustainability, Essity aims to achieve net zero emissions by 2050. It recently inaugurated a production line in France that manufactures tissue from recycled food and beverage cartons, recycling over half of all sorted and recycled cartons in the country. The company also utilizes solar energy for production at its site in the Netherlands.
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