Essity delivered its highest profitability margin in five years despite lower reported sales in the full-year 2025 results, highlighting resilience in its hygiene and health portfolio amid a challenging economic environment.
Group net sales for 2025 totaled SEK 138.5 billion, down 4.8% from 2024, primarily due to adverse currency translation effects of SEK 6.4 billion; excluding FX, sales rose slightly by SEK 1.4 billion. Organic sales growth was positive at 0.9%, driven entirely by favorable price and mix effects with volumes flat at 0.0%.
Adjusted EBITA excluding items affecting comparability (IAC) reached SEK 19.6 billion, a 4% decline from the prior year but with the margin expanding 0.1 percentage points to a record 14.1%. Earnings per share for total operations rose to SEK 18.37 (from SEK 29.83), reflecting a one-off gain in 2024, while Q4 EPS climbed to SEK 4.69 from SEK 4.13.
In Q4, net sales fell 8.2% to SEK 34.7 billion with organic growth at -1.1% (volume -0.2%, price/mix -0.9%). Profitability strengthened sharply, however, with adjusted EBITA up 3% to SEK 5.1 billion and the margin surging 1.6 points to 14.7% – the strongest quarterly performance in recent years.
“Our highest margin in five years reflects the strength of our leading hygiene and health brands that people rely on daily,” said President and CEO Ulrika Kolsrud. “We grew organically, made a strategic acquisition, launched innovations, and gained market share across more than 65% of our branded retail portfolio despite weak demand.”
Under the new pro forma business area structure (effective 1 January 2026), Personal Care led organic growth at around 3.7% through nine months, fueled by strength in feminine care (Saba) and incontinence retail (TENA, including TENA Men). Health & Medical advanced 1.1%, Consumer Tissue 1.2%, and Professional Hygiene a modest 0.7% in a soft B2B market.
Consumer Tissue, representing roughly one-third of group sales and heavily weighted to Europe (part of the 60% regional sales share), benefited from premium product launches and marketing. Professional Hygiene, with strong North American exposure (one-quarter of sales), advanced through innovations like Tork PeakServe dispensers.
Sales channels reflected balance: retail trade ~54%, business-to-business ~26%, healthcare ~20%. Management highlighted gains in high-margin categories despite selective price reductions in Q4 to support volumes.
Robust cash generation underpinned a second SEK 3 billion share buyback launched in April 2025 and a proposed 6% dividend increase to SEK 8.75 per share at the 2026 AGM. ROCE excluding IAC held steady at 17.2%.
Essity advanced toward net-zero GHG emissions by 2050, with Scope 1+2 emissions down 27% versus baseline and total recordable injury rate reduced 66% (target -75% by 2025). Some 71% of production waste is now recovered for material or energy use, supporting the 2030 zero-landfill goal. The company earned top ratings including MSCI AAA, CDP A List, DJSI inclusion, and EcoVadis Platinum.
Leadership emphasized ongoing cost programs, digitalization, capacity optimization, and innovation to drive profitable growth. “We will accelerate volume growth through marketing, customer engagement, and a value-segment focus while enhancing efficiency across the business,” Kolsrud noted.
Essity enters 2026 with new business area alignment and a platform for margin expansion and share gains in tissue, nonwovens, and professional hygiene amid stabilizing macro conditions.
