Belgian company Ontex's revenue up 1.7% in Q3FY24

In the third quarter, volumes, including mix effects, were up 4.4 per cent, driven by contract gains and supportive demand in adult care, and by growth in baby care with new retail customers in North America. Sales prices were 2.6 per cent lower, as expected, reflecting raw material index decreases and investments in increased competitiveness. Forex fluctuations were supportive, adding 0.7 per cent, bringing total growth at 2.4 per cent.

Adjusted EBITDA was €56 million (~$60.57 million), up 29 per cent year on year, thanks to volume and mix growth and the cost transformation programme delivery, contributing €8 million (~$8.65 million) and €14 million (~$15.14 million) respectively. The operational efficiency improved further by 3.7 per cent, driving stronger profitability and competitiveness. Index-driven lower raw material costs more than compensated for lower sales prices, leading to a €4 million positive net impact, the company said in a press release.

In September, Ontex reached a binding agreement to sell its Brazilian business activities to Softys SA for an enterprise value of approximately €110 million (~$118.99 million), enabling improved focus on retail brands and healthcare in Europe and North America. Net proceeds of approximately €82 million (~$88.70 million) are due at closing, which is expected during the first half of 2025, subject to customary conditions.

In October, the social negotiations regarding the transformation of the operating footprint in Belgium were successfully concluded. This transformation fits in Ontex’s footprint optimization, allowing it to further strengthen Ontex’s competitive position.

“With the agreement to sell our Brazilian operations, Ontex’s transformation is marking a major milestone, shifting our focus even more to retail brands and healthcare in the rapidly growing North American market and in the streamlined European market. Finalising social negotiations to optimise our European manufacturing footprint has been another milestone to realise that. Meanwhile we delivered solid results, allowing us to confirm our adjusted EBITDA margin and free cash flow expectations, which is an excellent achievement for the entire Ontex team,” Gustavo Calvo Paz, Ontex’s CEO, said.

Fibre2Fashion News Desk (RR)