Essity, a leading global hygiene and health company, has reported a 1.2 per cent decline in net sales in the second quarter of fiscal 2024 (Q2 FY24), which amounted to Swedish Krona (SEK) 366.17 billion (approximately $4.37 billion), compared to SEK 370.78 billion in the same period last year.

Despite the decrease in net sales, Essity experienced a notable increase in EBITA. The company’s EBITA surged by 27 per cent to SEK 5.237 billion, up from SEK 4.131 billion in Q2 FY23. When excluding items affecting comparability (IAC), EBITA rose by 17 per cent to SEK 5.398 billion from SEK 4.617 billion, with the EBITA margin excluding IAC increasing by 2.2 percentage points to 14.7 per cent, compared to 12.5 per cent in the previous year, the company said in a press release.

Organic growth for the period was reported at minus 0.9 per cent, with volume contributing 0.4 per cent and price to mix accounting for minus 1.3 per cent.

Essity's return on capital employed (ROCE) also saw a significant improvement, rising to 17.9 per cent from 14.2 per cent in the previous year. Operating cash flow increased by 14 per cent, reaching SEK 3.239 billion, up from SEK 2.847 billion in Q2 FY23.

Profit for the period from total operations amounted to SEK 3.333 billion, a substantial increase from SEK 2.551 billion in the previous year. Correspondingly, earnings per share from continuing operations rose to SEK 4.72, compared to SEK 3.46 in Q2 FY23. Earnings per share from total operations also increased to SEK 4.72, up from SEK 3.53 in the same period last year.

“Essity is in better shape than ever, reporting strong second-quarter earnings with good underlying growth and its highest operating profit (EBITA) to date. All business areas achieved higher EBITA margins compared with the preceding year. We presented new ambitious financial targets during the quarter, and initiated a share buyback programme,” said Magnus Groth, president and CEO.