STOCKHOLM, July 18, 2024 /PRNewswire/ —
Quarter 2, 2024 – Strong earnings and good underlying growth
- Net sales decreased 1.2% to SEK 36,617m (37,078)
- Organic growth amounted to -0.9%, of which volume accounted for 0.4% and price/mix -1.3%. Excluding restructuring and exited contracts, volumes increased 2.9%.
- EBITA increased 27% to SEK 5,237m (4,131)
- EBITA excl. IAC increased 17% to SEK 5,398m (4,617) and the EBITA margin excl. IAC increased 2.2 percentage points to 14.7% (12.5)
- ROCE increased to 17.9% (14.2), and ROCE excl. IAC increased 2.7 percentage points to 18.5% (15.8).
- Operating cash flow increased 14% to SEK 3,239m (2,847)
- Profit for the period, total operations, amounted to SEK 3,333m (2,551)
- Earnings per share, continuing operations, increased to SEK 4.72 (3.46). Earnings per share, total operations, increased to SEK 4.72 (3.53).
- Pursuant to the authorization granted by the Annual General Meeting, the Board of Directors has decided to buy back own Class B shares for SEK 3bn commencing on June 17, 2024
- New financial targets with raised level of ambition presented: Annual organic sales growth >3% and EBITA margin excl. IAC >15%
CEO’S COMMENTS
Essity is in better shape than ever, reporting strong second-quarter earnings with good underlying growth and its highest operating profit (EBITA) to date. All business areas achieved higher EBITA margins compared with the preceding year. We presented new ambitious financial targets during the quarter, and initiated a share buyback program.
Higher volumes
All categories reported higher volumes, excluding the restructuring in Professional Hygiene, and in several categories we outperformed the market in terms of growth. The quarter shows the results of our greater emphasis on profitable volume growth based on attractive product offerings, increased investments in sales and marketing, and cost savings.
Higher margin
All business areas reported a higher EBITA margin. We maintained strong price discipline, and there was hence a further widening of the gap between our sales prices and costs. The product mix also developed positively, particularly in Professional Hygiene where sales of premium products increased. Cost savings remained high in the quarter, with contributions from the entire value chain.
New financial targets and share buyback program
The new financial targets we presented during the quarter raised our level of ambition even further. Our aim is to grow organically by more than 3% per year and have a margin of above 15%. We have also initiated a share buyback program financed by the strong cash flow generated by operations. The ambition is to continue the share buybacks as a recurring part of Essity’s capital allocation.
In summary
We put another strong quarter behind us in which all business areas contributed to profitable growth and to a continued healthy cash flow. Favorable long-term market trends combined with Essity’s successful innovations, strong brands and efficiency efforts provide us with a platform to continue to increase the company’s value creation going forward.
Magnus Groth, President and CEO
INVITATION TO PRESENTATION
President and CEO Magnus Groth and Executive Vice President and CFO Fredrik Rystedt will present the interim report at a live webcast and teleconference at 09:00 CET on July 18, 2024.
Link to the live presentation, which can also be viewed afterwards: https://essity.videosync.fi/2024-07-18-q2
Contact information for conference call with the possibility to ask questions:
UK: +44 (0) 33 0551 02 00
USA: +1 786 697 35 01
SWE: +46 (0) 8 505 204 24
Please call in well in advance of the start of the presentation. Indicate: “Essity”.
The presentation will also be broadcast live on LinkedIn.
For additional information, please contact:
Fredrik Rystedt, Executive Vice President and CFO, Tel: +46 (0) 8 788 51 31
Sandra Åberg, Vice President Investor Relations, Tel: +46 (0) 70 564 96 89
Per Lorentz, Vice President Corporate Communications, Tel: +46 (0) 73 313 30 55
NB: This information is such information that Essity Aktiebolag (publ) is obligated to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. This report has been prepared in both Swedish and English versions. In case of variations in the content between the two versions, the Swedish version shall govern. The information was submitted for publication, through the agency of Karl Stoltz, Media Relations Director, at 07:00 CET on July 18, 2024.
This information was brought to you by Cision http://news.cision.com
https://news.cision.com/essity/r/interim-report–quarter-2–2024,c4016210
The following files are available for download:
