10.27.22
In the third quarter of 2022 compared with the corresponding period a year ago, Essity’s net sales increased 28.8% to SEK 40.1 billion ($3.7 billion). Sales growth, including organic sales growth and acquisitions, amounted to 17.3%. Organic sales growth, which excludes exchange rate effects, acquisitions and divestments, amounted to 16.3%, of which volume accounted for 1.5% and price/mix for 14.8%. Organic sales growth in mature markets amounted to 16.6% and in emerging markets to 15.5%. Emerging markets accounted for 37% of net sales. Exchange rate effects increased net sales by 11.6%. Acquisitions increased net sales by 1%. Divestments reduced net sales by 0.1%.
In the Health & Medical segment, third quarter net sales increased 17.5% to SEK 6.544 billion ($595 million). Sales growth, including organic sales growth and acquisitions, amounted to 9.9%. Organic sales growth amounted to 7.6%, of which volume accounted for 1.3% and price/mix for 6.3%. The organic sales growth amounted to 5.7% in mature markets. In emerging markets, which accounted for 20% of net sales, organic sales growth was 15.5%. Exchange rate effects increased net sales by 8.1%. Acquisitions increased net sales by 2.3%. Divestments reduced net sales by 0.5%. For Incontinence Products Health Care, with Essity’s globally leading Tena brand, organic sales growth amounted to 8.3% due to higher volumes and higher prices. In Medical Solutions, organic sales growth amounted to 6.4% mainly as a result of higher volumes and higher prices. Sales growth was high in Wound Care and Orthopedics.
In Consumer Goods, net sales in the quarter increased 30.1% to SEK 23.8 billion ($2.2 billion). Sales growth, including organic sales growth and acquisitions, amounted to 18.4%. Organic sales growth amounted to 17.6%, of which volume accounted for 1.3% and price/mix for 16.3%. Organic sales growth amounted to 19.4% in mature markets. In emerging markets, which accounted for 49% of net sales, organic sales growth was 15.5%. Exchange rate effects increased net sales by 11.7%. Acquisitions increased net sales by 0.8%. For Incontinence Products Retail, organic sales growth amounted to 6.6%, in Feminine Care to 14.6% and in Baby Care to 0.1%. In Consumer Tissue, organic sales growth amounted to 23.4% and for the Consumer Tissue Private Label Europe division to 42.9%. Prices were higher in all categories. Volumes in Baby Care were negatively impacted by the discontinuation of baby diaper operations in Latin America.
Magnus Groth, president and CEO, comments: “Essity’s net sales reached new record levels in the third quarter. We raised prices for our leading hygiene and health solutions by an average of 14.5% compared to the same period a year ago at the same time as we reported higher volumes in all business areas. Our price increases are offsetting the high cost inflation with a delay of approximately two quarters. We are continuing to invest in innovation and expansion of our offerings to promote a higher quality of life for customers and consumers with more climate-smart offerings, strong brands and increased e-commerce sales.
“The environmental footprint of our products is decreasing, and we are meeting consumer demands for solutions that are better for the user and the planet. During the quarter, we launched a climate-smart baby diaper under the leading brand Libero. Libero’s hybrid diaper consists of two parts: a washable textile diaper cover and an absorbent disposable insert. Online sales increased by nearly 20% in the third quarter and amounted to approximately SEK 5.7bn. Many initiatives are being implemented in the company to also increase our presence in the direct-to-consumer channel, including the acquisitions of Knix and Modibodi, two leading companies in leakproof apparel.”
In the Health & Medical segment, third quarter net sales increased 17.5% to SEK 6.544 billion ($595 million). Sales growth, including organic sales growth and acquisitions, amounted to 9.9%. Organic sales growth amounted to 7.6%, of which volume accounted for 1.3% and price/mix for 6.3%. The organic sales growth amounted to 5.7% in mature markets. In emerging markets, which accounted for 20% of net sales, organic sales growth was 15.5%. Exchange rate effects increased net sales by 8.1%. Acquisitions increased net sales by 2.3%. Divestments reduced net sales by 0.5%. For Incontinence Products Health Care, with Essity’s globally leading Tena brand, organic sales growth amounted to 8.3% due to higher volumes and higher prices. In Medical Solutions, organic sales growth amounted to 6.4% mainly as a result of higher volumes and higher prices. Sales growth was high in Wound Care and Orthopedics.
In Consumer Goods, net sales in the quarter increased 30.1% to SEK 23.8 billion ($2.2 billion). Sales growth, including organic sales growth and acquisitions, amounted to 18.4%. Organic sales growth amounted to 17.6%, of which volume accounted for 1.3% and price/mix for 16.3%. Organic sales growth amounted to 19.4% in mature markets. In emerging markets, which accounted for 49% of net sales, organic sales growth was 15.5%. Exchange rate effects increased net sales by 11.7%. Acquisitions increased net sales by 0.8%. For Incontinence Products Retail, organic sales growth amounted to 6.6%, in Feminine Care to 14.6% and in Baby Care to 0.1%. In Consumer Tissue, organic sales growth amounted to 23.4% and for the Consumer Tissue Private Label Europe division to 42.9%. Prices were higher in all categories. Volumes in Baby Care were negatively impacted by the discontinuation of baby diaper operations in Latin America.
Magnus Groth, president and CEO, comments: “Essity’s net sales reached new record levels in the third quarter. We raised prices for our leading hygiene and health solutions by an average of 14.5% compared to the same period a year ago at the same time as we reported higher volumes in all business areas. Our price increases are offsetting the high cost inflation with a delay of approximately two quarters. We are continuing to invest in innovation and expansion of our offerings to promote a higher quality of life for customers and consumers with more climate-smart offerings, strong brands and increased e-commerce sales.
“The environmental footprint of our products is decreasing, and we are meeting consumer demands for solutions that are better for the user and the planet. During the quarter, we launched a climate-smart baby diaper under the leading brand Libero. Libero’s hybrid diaper consists of two parts: a washable textile diaper cover and an absorbent disposable insert. Online sales increased by nearly 20% in the third quarter and amounted to approximately SEK 5.7bn. Many initiatives are being implemented in the company to also increase our presence in the direct-to-consumer channel, including the acquisitions of Knix and Modibodi, two leading companies in leakproof apparel.”
