Essentra (ESNT) Trading Update summary

Trading performance

• Q3 revenue grew 5.9% year-on-year at constant currency, reflecting gradual market recovery and easier comparatives.

• New order intake rose 5.6% in Q3, with September rebounding after seasonally softer July and August.

• EMEA saw mixed results, with Turkey outperforming due to pricing and currency effects, while UK and Western Europe remained subdued.

• Americas maintained growth momentum, supported by pricing actions and stable distributor channels.

• APAC performance was driven by China and new business wins in faster-growing markets.

Operational and financial position

• Focus remains on operational efficiencies and selective reinvestment aligned with regional demand.

• EMEA investments continue in service and ERP deployment; Americas advance pricing initiatives.

• Footprint rationalisation measures are progressing as planned.

• Financial position is robust, with FY25 leverage expected within 0.5x to 1.5x, supported by strong cash flow.

• Acquisition pipeline is strong, with active review of bolt-on opportunities.

Outlook and margin guidance

• Revenue growth and improved order intake continued into October.

• Cautious on timing of broader market recovery, but cost base streamlining and operational optimisation to protect profitability.

• Strong performance in Turkey, which has lower margins, led to slightly weaker group gross margin, expected to persist in Q4.

• Full year adjusted operating margin anticipated to remain consistent with H1.

• Board remains confident in achieving medium-term strategic and financial targets, supported by operational progress and growth opportunities.