#Sweden #Stockholm #Essity #Hygiene Products #Market Shares

Essity Ends 2025 on a Positive Note Despite Sales Decline

Essity, the global leader in hygiene and health products, has reported its financial performance for the fourth quarter and full year of 2025. Despite a challenging market backdrop, the company showed resilience with increased market shares and high profitability.

Fourth Quarter Highlights

In the fourth quarter of 2025, Essity's net sales declined by 8.2%, amounting to SEK 34,695 million compared to SEK 37,805 million from the previous year. When excluding currency translation effects, net sales showed a decrease of SEK 400 million. However, the organic sales growth was slightly negative at -1.1%. This decrease was especially impacted by pricing adjustments, even though both volume and product mix remained relatively stable.

On a brighter note, Essity achieved an EBITA increase of 9%, totaling SEK 5,005 million, and the EBITA margin (excluding items affecting comparability) improved from 13.1% to 14.7%. Company performance measures like Return on Capital Employed (ROCE) also reflected positive growth, rising to 17.6%.

Full-Year Financial Overview

For the fiscal year 2025, Essity recorded a net sales decrease of 4.8%, bringing the total to SEK 138,494 million, down from SEK 145,546 million in 2024. However, excluding currency effects, net sales rose by SEK 1,354 million, indicating a stronger underlying performance. The organic sales growth for the year was 0.9%, which translates to an impressive 14.1% EBITA margin, the highest reported since 2020.

Earnings per share also climbed to SEK 18.37, up from SEK 29.83. Notably, the company's Board of Directors has proposed increasing dividends by 6%, signaling confidence in ongoing growth and profitability.

Growth Drivers and Strategic Moves

In a strategic move to strengthen its position in North America, Essity announced the acquisition of Edgewell's feminine care business, which encompasses well-known brands such as Carefree, Stayfree, and Playtex. This acquisition is expected to complete in early 2026 and is part of Essity's strategy to bolster its Personal Care segment while focusing on high-growth categories.

Furthering this strategy, Essity reported strong growth in its key segments. Brands like TENA and Hydrofera showed significant momentum, boosting overall market shares. The company achieved higher margins across all business areas, largely due to effective cost management and marketing strategies that enhanced sales figures.

A Stable Outlook

Despite the turbulence in the market, Essity delivered a stable financial year, aided by robust cash flow. The company plans to invest further in growth initiatives while ensuring returns to shareholders. The new decentralized organizational structure, effective from January 1, 2026, aims to enhance customer focus and operational flexibility, which is expected to facilitate quicker decision-making and improved competitiveness.

CEO Ulrika Kolsrud commented, "We saw increased market shares and high profitability along with strategic growth across various segments. Our focus on enhancing our offerings and operational capabilities will prepare us well for future challenges and opportunities."

Conclusion

Essity's 2025 report indicates that while net sales might have decreased, the company's strong market position and strategic initiatives are paving the way for future growth. With plans to further strengthen its portfolio through acquisitions and innovations, Essity remains committed to boosting its market presence and delivering exceptional shareholder value.