Essity AB Class B

Net sales increased by about SEK 1 billion year over year, with 0.3% organic sales growth and 1.7% from the feminine business acquisition in North America. Volume grew 1.4%, while price/mix was negative 1.1%. Reported margin declined 30 basis points and gross profit margin declined 70 basis points. Cash flow was SEK 2.8 billion, net debt-to-EBITDA was 1.1, and the company bought back 2.1 million shares for roughly SEK 550 million. For Q3, management expects significantly higher COGS, including higher oil-based material and energy costs, and somewhat higher SG&A costs including A&P; price increases already announced should start showing in the P&L in Q3, with further compensation to follow over time. The company reaffirmed its financial targets of above 3% organic growth and a profit margin of at least 15%.

Ulrika Kolsrud framed the quarter as a volume-led, broadly constructive period with improving market share in key categories. She emphasized innovation, marketing, selective price actions, and cost savings as the drivers behind growth, and pointed to new products in Health & Medical, Personal Care, and Professional Hygiene as evidence of execution. Her tone was confident but pragmatic: she acknowledged tougher conditions in Consumer Tissue and the need to offset inflation with price increases while continuing to protect and grow share.

Fredrik Rystedt said sales rose by about SEK 1 billion year over year, with 1.4% volume growth and 0.3% organic growth, while price/mix was negative 1.1%. He noted the reported margin fell 30 basis points and gross margin fell 70 basis points, mainly because COGS increased, there were some price declines in Consumer Tissue, Baby, and Professional Hygiene from earlier quarters, and the feminine acquisition in the U.S. created margin pressure; he also said SG&A savings contributed about SEK 100 million in the quarter and the company expects to reach SEK 1 billion or more of annualized SG&A savings by year-end. Cash flow was SEK 2.8 billion, net debt-to-EBITDA remained 1.1, and the company repurchased 2.1 million shares for roughly SEK 550 million; for Q3 he guided to significantly higher COGS and slightly higher SG&A versus Q3 2025.

Analysts focused on Consumer Tissue pricing, the durability of Professional Hygiene growth, the impact of pre-buying in Health & Medical, and the timing/size of higher COGS and offsetting price increases. Management said some price increases are already implemented and more will appear in Q3, private label volumes in Consumer Tissue are secured for the second half, and they cannot quantify any pre-buying effect. On Professional Hygiene, they said the strong volume trend is underlying rather than a one-off from the World Cup, and on the feminine acquisition they said the margin drag is cost-related and should improve as integration progresses.