Essity 1Q 2020 Results: Adjusted EBITA up 67 Percent from Year ago

The Group’s net sales increased 10 percent in the first quarter of 2020 compared with the corresponding period a year ago. Organic net sales increased 7.8 percent, of which volume accounted for 5.9 percent and price/mix for 1.9 percent.

The COVID-19 pandemic resulted in a sharp increase in sales in many markets for Consumer Tissue, Incontinence Products, Baby Care, Feminine Care and Professional Hygiene as a result of stockpiling among consumers and distributors. In March 2020, organic net sales for the Group increased 19.7 percent compared with March 2019.

Organic net sales for Personal Care rose by 17.0 percent, for Consumer Tissue by 19.5 percent and for Professional Hygiene by 24.5 percent. Sales in future quarters will be adversely impacted by the stockpiling seen in March and sales in Professional Hygiene will also be negatively impacted by reduced travel, fewer restaurant visits and more people working from home. In the long-term, the COVID-19 pandemic may lead to increased demand for hygiene and health products due to, for example, a greater focus on hand hygiene.

Production facilities outside of China did not experience any major production disruptions due to the COVID-19 pandemic, although distribution costs have increased. Lower prices, mainly related to Consumer Tissue in Europe and Asia, had a negative impact on the gross margin.

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