January 26, 2022

Financial reporting for Essity's new business areas

As of January 1, 2022, Essity's business areas are Health & Medical, Consumer Goods and Professional Hygiene. These are aligned with the company's customer and sales channels and will lead to an expansion of the offerings to new and adjacent categories as well as extended service content on the basis of customer and consumer needs. The new areas support the company's new sales growth target through strategies for organic and acquisition-driven growth and aim to achieve higher growth and profit margins as well as less capital tied up. The business areas replace the former business areas Personal Care, Consumer Tissue and Professional Hygiene.

Business areas:

Health & Medical

Health & Medical encompasses the Incontinence Products Health Care and Medical Solutions categories. The offering includes incontinence products, wound care, compression therapy, orthopedics, skincare products and digital solutions with sensor technology under brands such as TENA, Leukoplast, Cutimed, JOBST, Actimove and Delta-Cast. Distribution channels for the products are pharmacies, medical devices stores, hospitals, distributors and care institutions as well as online.

Consumer Goods

Consumer Goods includes the categories of Incontinence Products Retail, Baby Care, Feminine Care and Consumer Tissue. The offering includes incontinence products, pads, diapers, wet wipes, skincare products, intimate soaps, washable absorbent underwear, menstrual cups, toilet paper, household towels, handkerchiefs, facial tissues and napkins. Products are sold under brands such as the globally leading TENA brand and other strong brands including Libero, Libresse, Nosotras, Saba, TOM Organic, Lotus, Regio, Tempo and Vinda. Distribution channels for the products are the retail trade and online.

Professional Hygiene

Professional Hygiene comprises complete hygiene solutions, including toilet paper, paper hand towels, napkins, hand soap, hand lotion, hand sanitizers, dispensers, cleaning and wiping products, as well as service and maintenance under the globally leading Tork brand. Essity also offers digital solutions, such as Internet of Things sensor technology, enabling data-driven cleaning. Customers consist of companies and office buildings, universities, healthcare facilities, industries, restaurants, hotels, stadiums and other public venues. Distribution channels for the products consist of distributors and online.

Financial reporting proforma

Essity's business area reporting proforma for net sales, organic sales growth, adjusted gross margin1), adjusted EBITA1), adjusted EBITA margin1), adjusted ROCE1), operating cash flow and capital employed has been restated for the periods below:

Net sales, SEKm2019202020212021:12021:22021:32021:4
Health & Medical 22,075 21,170 21,685 5,004 5,255 5,572 5,854
Consumer Goods 76,169 75,146 74,040 17,309 17,577 18,310 20,844
Professional Hygiene 30,731 25,418 26,143 5,216 6,140 7,260 7,527
Other - 18 -1 -1 -4 3 1
Total128,975121,752121,86727,52828,96831,14534,226
Net sales by category, %2021
Health & Medical18%
Incontinence Products Health Care 11%
Medical Solutions 7%
Consumer Goods60%
Consumer Tissue 40%
Incontinence Products Retail 6%
Feminine Care 7%
Baby Care 7%
Professional Hygiene22%
Organic sales growth, %202020212021:12021:22021:32021:4
Health & Medical -1.8% 5.4% -4.6% 13.4% 7.3% 6.9%
Incontinence Products Health Care 2.5% 2.1% -5.4% 2.1% 5.6% 6.8%
Medical Solutions -8.2% 10.8% -3.3% 35.4% 9.7% 7.1%
Consumer Goods 3.2% 1.8% -4.4% 3.7% 2.9% 5.7%
Consumer Tissue 4.1% 0.5% -3.1% -0.2% -0.6% 5.5%
Incontinence Products Retail 3.0% 5.7% -7.1% 14.1% 13.0% 5.5%
Feminine Care 5.0% 10.0% -0.1% 11.0% 15.8% 15.3%
Baby Care -2.5% -0.6% -12.2% 12.4% 1.5% -1.3%
Professional Hygiene -14.6% 5.7% -27.5% 26.1% 20.7% 16.4%
Group-1.9%3.3%-9.9%9.5%7.4%8.0%
Adjusted gross margin1), %2019202020212021:12021:22021:32021:4
Health & Medical 42.4% 43.4% 42.3% 44.8% 43.2% 42.4% 39.2%
Consumer Goods 27.0% 31.4% 27.0% 31.1% 28.2% 26.4% 23.0%
Professional Hygiene 26.8% 26.9% 23.3% 23.7% 25.7% 24.0% 20.4%
Group29.5%32.5%28.9%32.2%30.4%28.7%25.2%
Adjusted EBITA1), SEKm2019202020212021:12021:22021:32021:4
Health & Medical 3,734 3,668 3,821 920 950 1,024 928
Consumer Goods 8,333 11,538 7,938 2,473 1,967 1,832 1,665
Professional Hygiene 4,463 3,317 2,710 419 710 900 681
Other -690 -897 -789 -204 -218 -170 -197
Total15,84017,62613,6803,6083,4093,5863,077
Adjusted EBITA margin1), %2019202020212021:12021:22021:32021:4
Health & Medical 16.9% 17.3% 17.6% 18.4% 18.1% 18.4% 15.9%
Consumer Goods 10.9% 15.4% 10.7% 14.3% 11.2% 10.0% 8.0%
Professional Hygiene 14.5% 13.0% 10.4% 8.0% 11.6% 12.4% 9.0%
Group12.3%14.5%11.2%13.1%11.8%11.5%9.0%
Adjusted ROCE1), %2019202020212021:12021:22021:32021:4
Health & Medical 12.2% 11.9% 12.7% 12.4% 12.6% 13.8% 12.1%
Consumer Goods 13.6% 19.4% 12.8% 17.0% 13.1% 11.6% 10.0%
Professional Hygiene 18.9% 14.6% 11.8% 7.7% 12.7% 15.3% 11.1%
Group13.8%15.7%12.0%13.5%12.4%12.3%10.1%
Operating cash flow, SEKm2019202020212021:12021:22021:32021:4
Health & Medical 3,550 4,141 3,832 732 755 1,307 1,038
Consumer Goods 7,815 9,799 6,328 1,957 927 1,640 1,804
Professional Hygiene 4,938 3,183 2,512 -29 655 1,132 754
Other -664 -1,105 -1,554 -384 -377 -403 -390
Total15,63916,01811,1182,2761,9603,6763,206
Capital employed, SEKm2019202020212021:12021:22021:32021:4
Health & Medical 30,362 28,642 31,401 30,734 29,618 29,931 31,401
Consumer Goods 61,251 57,146 66,939 58,994 61,040 65,827 66,939
Professional Hygiene 22,996 20,915 24,518 22,607 22,305 24,595 24,518
Other -868 -673 1,082 -5,092 -281 567 1,082
Total113,741106,030123,940107,243112,682120,920123,940
1)Excluding items affecting comparability
Financial reporting for Essity's new business areas
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Essity AB (publ) published this content on 26 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 January 2022 10:15:01 UTC.