Essity (ESSITY) investor relations material

Deal rationale and strategic fit

• Acquisition expands presence in North America, aligning with a strategy to focus on high-margin, high-yielding categories and attractive geographies, particularly feminine care.

• Adds established brands such as Carefree, Stayfree, o.b., and global rights to Playtex, with strong #2 or #3 market positions in the U.S. and Canada.

• Builds a strong personal care platform in the US, complementing existing product lines and supporting growth ambitions for incontinence products.

• Leverages proven innovation, brand building, and supply chain expertise to revitalize acquired brands.

• Provides a platform for further organic and inorganic growth in personal care.

Financial terms and conditions

• Purchase price is $340 million (USD 340m/SEK ~3.2bn) on a cash and debt-free basis.

• Acquired business reported net sales of $261 million and operating profit of $17 million for the 12 months ending June 30, 2025.

• EBITDA multiple is 12.1x (IFRS), reduced to 8.3x post-synergies.

• Transaction expected to close in Q1 2026, subject to customary regulatory approvals.

• Expected to be EPS neutral in year one (excluding one-time costs), accretive from year two onward.

Synergies and expected cost savings

• $30 million in run-rate cost synergies expected by end of year two, mainly from procurement, admin, and material rationalization.

• Additional revenue synergies anticipated from cross-selling incontinence and feminine care products in North America, with benefits expected from year three onward.

• Pro forma EBITDA post-synergies estimated at $41 million.

• Significant synergies anticipated, with full realization expected by the end of year two.

• Estimated run-rate synergies reduce the effective EBITDA multiple to 8.3x.