Building on the stable momentum reported in its Q1 2026 financial results, Essity chose its Capital Markets Day on May 7, 2026, to announce a monumental structural shift: a formal strategic review of its entire Consumer Tissue business area, including potential plans for a separation.

The event, themed "Accelerating progress by sharpening focus and execution," detailed a long-term roadmap to transform the company's portfolio allocation toward its highest-margin segments.

The Group Strategy: Portfolio Optimization

President and CEO Ulrika Kolsrud opened the event by clarifying Essity's overarching financial targets, which remain fixed at an annual organic sales growth of >3% and an adjusted EBITA margin of >15%.

To accelerate achievement of these metrics, Essity has officially initiated a strategic review of its Consumer Tissue division. In 2025, Consumer Tissue accounted for 31% of Group net sales (SEK 43.5bn) but yielded an EBITA margin of 11.9%—a performance trailing the Group’s long-term profitability targets.

According to Kolsrud, different strategic alternatives are being evaluated. This process may lead to a full separation (divestment or a separate listing), aiming to create the best conditions for both the Group and the tissue unit to reach their maximum valuation and growth potential.

Consumer Tissue Strategy: Volker Zöller Outlines Road to Value

Volker Zöller, President of Consumer Tissue, delivered a session focused on steering the segment through its newly established operational setup. Effective January 1, 2026, the Consumer Tissue business area has operated with complete end-to-end responsibility across its R&D, production, and marketing teams—positioning it to function autonomously ahead of any impending structural change.

Zöller established a clear operational framework to improve the segment's valuation:

• Segment Financial Targets: An independent annual organic sales growth target of 1–2% and a segment-specific EBITA margin target of >12%.
• The Shift to Premiumization: The segment is systematically moving away from lower-margin, volume-heavy private label contracts. Instead, resources will focus heavily on accelerating the market presence of its primary "Power Brands"—Lotus, Tempo, Zewa, Cushelle, Plenty, Regio, and Familia.
• Operational Cost Contributions: The division remains a foundational pillar for achieving the Group’s ongoing SEK 1bn annual cost-savings initiative, leveraging supply chain efficiencies to combat structural volatility in energy and raw material prices.

Sustainability & Technology: Innovation at Lilla Edet

A cornerstone of both the digital webcast and the accompanying presentation data was Essity's ongoing rollout of manufacturing innovations, framed around what the company labels its "Lighthouse" projects.

Following the presentations, event attendees toured the R&D hubs in Gothenburg and the production facilities at Lilla Edet. The modern mill was highlighted as a critical industry blueprint, operating as the world's first large-scale tissue manufacturing facility to run free from fossil CO₂ emissions by utilizing biogas and renewable electricity.

Key technical developments presented by Zöller included:

• Alternative Fiber Integration: Scaling the industrial implementation of agricultural by-products (wheat straw) at the Mannheim facility. This provides a structural hedge against global wood pulp price fluctuations while reducing the overall environmental footprint.
• Coreless Technology Expansion: Broader commercialization of coreless rolled products, notably within the Zewa Wisch&Weg Smart lines. Eliminating the cardboard core yields a 10% reduction in logistical carbon emissions while doubling the sheet count per roll, answering a clear shift in retail demand for sustainable packaging.

The Broader Picture: Growth Targets by Segment

As part of the structural shift, Essity highlighted how capital allocation will heavily favor its higher-yielding divisions, supported by the recently completed acquisition of the Carefree, Stayfree, and o.b. feminine care brands in North America.

The company detailed its specific growth expectations across all four business units:

Industry Outlook

Essity’s 2026 Capital Markets Day highlights a definitive change in corporate priority from volume metrics to strict margin discipline. By placing its Consumer Tissue unit under strategic review, the Group is preparing to decouple its high-margin personal care divisions from the volatile overhead of tissue manufacturing with the stated objective for the division to leverage its premium power brands and fossil-free operational efficiency to maintain long-term market leadership.