Essity (ESSITY) investor relations material

Strategic Focus and Business Overview

• Operates in 150 countries with 36,000 employees and SEK 150 billion in annual net sales, focusing on high-margin segments like incontinence care, feminine hygiene, and wound care while reducing emphasis on lower-margin consumer tissue.

• Holds leading positions with brands such as TENA, Tork, Libresse, and Lotus, with 90% of branded sales in #1 or #2 market positions and strong presence in 60% of branded sales.

• Brands serve a billion people daily across hygiene and health categories, with market leadership driven by demographic trends like aging populations and increased health awareness.

• Market growth exposure is highest in developing and emerging regions, with ambitions to outperform the market and achieve over 3% organic growth at a 15% profit margin.

• Three main business areas: Professional Hygiene, Health & Medical, and Consumer Goods, with Consumer Goods accounting for 54% of net sales.

Innovation, Product Development, and Sustainability

• Recent innovations include upgraded TENA Men packaging, new feminine hygiene products for heavier flows, and sensor-based dispensers with extended battery life.

• Coreless toilet paper technology expanded to premium and professional hygiene products, with notable launches like Tork OptiServe and Lotus paper-packaged products.

• Brands like Bodyform and Libresse emphasize superior protection and confidence.

• Recognized for ESG leadership, awarded Supplier Engagement Leader by CDP and included in FTSE4Good Index.

• Focus on customer centricity, efficiency gains, and evolving go-to-market strategies to enhance competitiveness.

Market Dynamics and Financial Performance

• Q2 saw organic growth and stable profit despite lower volumes and higher costs, with strong growth in strategic segments and high pace of product launches.

• Flattish volume growth and rising costs prompt focus on accelerating volume growth and cost reduction for the remainder of the year.

• Gaining or stabilizing market share in most categories, with particular strength in feminine hygiene and challenges in baby care.

• Consumer tissue growth concentrated in low and mid-tiers, offset by presence in private label.

• Financial targets and vision remain unchanged, with continued commitment to organic growth above 3%, EBITA margin above 15%, and recurring share buybacks.