Hygiene and health products leader Essity reported a strong operational start to 2026, with organic sales growth of 0.4% and an improved EBITA margin excluding items affecting comparability (IAC) of 13.9%, despite a 5.1% drop in reported net sales to SEK 33,177m.
Higher volumes across key segments offset softer pricing and currency headwinds, while the recent acquisition of Edgewell's North American feminine care business bolstered growth. The company also announced a new SEK 3bn share buyback program post-quarter.
Reported net sales fell to SEK 33,177m from SEK 34,976m a year earlier, primarily due to a 6.6% currency translation impact. Excluding currencies, sales rose SEK 528m, driven by 1.1% volume growth that outpaced a 0.7% price/mix decline.
EBITA excluding IAC dipped 2% to SEK 4,603m but gained 5% on a currency-adjusted basis, lifting the margin 0.4 points to 13.9%. Profit for the period was SEK 2,901m, with earnings per share at SEK 4.23. Operating cash flow strengthened 16% to SEK 4,354m.
|
Key Metric |
Q1 2026 |
Q1 2025 |
Change |
|
Net sales, SEKm |
33,177 |
34,976 |
-5.1% |
|
Organic growth |
0.4% |
2.1% |
- |
|
EBITA excl. IAC margin |
13.9% |
13.5% |
+0.4pp |
|
Operating cash flow, SEKm |
4,354 |
3,765 |
+16% |
|
Net debt/EBITDA excl. IAC |
0.96x |
1.02x |
Improved |
Personal Care led with 4.1% organic growth and a 15.4% EBITA margin excluding IAC, fueled by incontinence and feminine care gains plus the Edgewell deal, which added 4.9% to sales. Professional Hygiene grew organically 1.9% on higher volumes, while Health & Medical posted 0.5% growth.
Consumer Tissue lagged with -3.5% organic decline, hit by lower prices and European private label softness, though branded volumes held firm.
|
Segment |
Organic Growth |
EBITA excl. IAC Margin |
|
Personal Care |
4.1% |
15.4% |
|
Professional Hygiene |
1.9% |
16.1% |
|
Health & Medical |
0.5% |
18.4% |
|
Consumer Tissue |
-3.5% |
10.7% |
Essity completed its USD 339m (SEK 2,994m) purchase of Edgewell's feminine care brands—Carefree, Stayfree, Playtex, and o.b.—on February 2, nearly doubling its North American personal care footprint. Product launches included softer Libero diapers, upgraded TENA briefs, Zewa coreless towels, and teen period pants.
Net debt eased to SEK 24.5bn, improving the leverage ratio to 0.96x. The board greenlit a SEK 3bn buyback starting May 11, after wrapping the prior program. An AGM dividend of SEK 8.75 per share was approved.
"We started 2026 with a positive volume trend, increased market shares, and higher margins," said Ulrika Kolsrud, President and CEO of Essity. "At the same time, we continued our efforts to accelerate growth, including the completion of the Feminine Care acquisition in North America, several product launches, and the implementation of our organizational change".
Kolsrud added, "Our gross margin increased as a result of higher volumes, lower costs of goods sold, and good price discipline. We have a broad range of leading hygiene and health products that people need regardless of the global economic conditions, and our operational flexibility leaves us well-equipped to navigate the challenges ahead".
Essity secured a EUR 400m EIB loan for R&D, appointed Niklas Westin Sundberg as CDIO, and saw a bond lawsuit dropped. Sustainability progress included a 28% Scope 1+2 emissions cut versus 2016 and 81% of innovations delivering social/environmental benefits.
