Essity's Third Quarter Report: Performance Insights
STOCKHOLM — Essity has released its interim report for the third quarter of 2025, showcasing critical insights into its financial performance and strategic initiatives. This report highlights organic growth, improved margins, and a robust cash flow, despite a drop in net sales.
Financial Overview of Q3 2025
During the third quarter of 2025, Essity witnessed a decline in net sales, decreasing by 4.5% to reach SEK 34,638 million, compared to SEK 36,274 million in the same period last year. Excluding the impacts of currency translation, net sales showed a slight increase of SEK 322 million. In terms of organic sales growth, the company reported an increase of 0.9%, attributed to a price/mix of 0.7% and a volume increase of 0.2%.
Profitability Metrics
Essity's EBITA grew marginally to SEK 5,152 million, reflecting the company’s resilience and strategic management. When excluding items affecting comparability (IAC), EBITA stood at SEK 5,056 million, representing a 1% decrease compared to the previous year. However, after adjusting for currency fluctuations, EBITA excluding IAC showed a notable increase of 5%, equating to SEK 278 million.
Margin Strength and Shareholder Returns
The EBITA margin excluding IAC improved by 0.5 percentage points, reaching 14.6%. Additionally, the return on capital employed (ROCE) was reported at 17.9%, reinforcing the company's efficient use of capital. Profits for the period amounted to SEK 3,358 million, with earnings per share rising to SEK 4.86.
CEO’s Insights and Strategic Initiatives
In the CEO's comments, the emphasis was placed on the positive outcomes achieved amidst challenging market dynamics. Essity is not only striving for growth but is also implementing significant organizational changes and launching a cost-savings program aimed at enhancing operational efficiency and profitability.
Innovations Driving Growth
Innovation remains a cornerstone of Essity’s growth strategy. Products tailored to meet customer and consumer needs are at the forefront of its developments. A prime example is the introduction of TENA ProSkin Stretch Day & Night, designed to streamline incontinence care, thus benefiting both healthcare providers and patients.
Measures to Enhance Growth Rate
To bolster its growth trajectory amid a complex economic environment, Essity has announced a set of strategic measures. These include decentralizing decision-making processes to heighten accountability across product categories. By simplifying the corporate structure, Essity aims to remain agile, improve customer focus, and capitalize on the most promising market opportunities.
Cost Savings Initiatives
In parallel with the organizational restructure, Essity is implementing a cost savings program targeting sales and administrative expenses while safeguarding marketing budgets. The initiative is anticipated to yield savings of around SEK 1 billion annually, with a full impact by the end of 2026, thereby supporting investments in sustainable growth.
Future Targeting and Vision
Essity aspires to reach broader audiences with its hygiene and health products, aiming to capture increased market shares while maximizing the potential of its diverse product portfolio. These strategic initiatives are poised to significantly shape the company’s future trajectory.
Invitation to Presentation
Ulrika Kolsrud, President and CEO, alongside Fredrik Rystedt, Executive Vice President and CFO, will present the interim report through a live webcast and teleconference. Interested parties are invited to tune in at the scheduled time to gain a deeper understanding of the company’s strategies and performance outlook.
Frequently Asked Questions
What were Essity's net sales for Q3 2025?
Essity's net sales for Q3 2025 were SEK 34,638 million, reflecting a 4.5% decrease.
How did Essity perform in terms of EBITA?
Essity's EBITA for Q3 2025 increased to SEK 5,152 million, showcasing its resilience in the market.
What innovations did Essity launch during this quarter?
Essity launched TENA ProSkin Stretch Day & Night, a new incontinence product tailored for ease of use.
What measures is Essity taking to enhance profitability?
Essity is decentralizing decision-making and launching a cost savings program with expected annual savings of SEK 1 billion.
Who will present the interim report?
The interim report will be presented by Ulrika Kolsrud, President and CEO, and CFO Fredrik Rystedt.
