Half Half-year R ear Repor eport 2020 t 2020 This presentation - PowerPoint PPT Presentation

Half Half-year R ear Repor eport 2020 t 2020

This presentation may contain forward-looking statements. Such statements are based on our current expectations and are subject to certain risks and uncertainties that could negatively affect our business. Please read our most recent annual and sustainability report for a better understanding of these risks and uncertainties. 2 July 13, 2020 Half-year Report 2020

Summary Summar Organic ganic Adjusted Adjus ted Adjusted Adjus ted H1 2020 vs H1 2019 Net S et Sales ales Net S et Sales ales 1) EBI BITA 2) EBI BITA A Mar argin gin 2) 2) 2) ▪ Strong performance in a challenging environment SEK SEK SEK SEK ▪ Sales negatively impacted by COVID-19 and 14.7% 14.7% 62,119m 62,119m -0.9% 0.9% 9,115m 9,115m x% x% related lockdowns +370bps +370bps -1.0% 1.0% +32% +32% ▪ Significant profitability improvement ─ Better mix ─ Significant cost savings Oper perating ting Ear arnings nings Adjusted Adjus ted Adjusted Adjus ted Cas Cash h Flo low per Shar per S hare ROCE CE 2) ROE 2) ─ Lower raw material and energy costs ─ Lower volumes SEK SEK SEK SEK ─ Higher distribution costs 15.6% 15.6% 19.5% 19.5% 8,827m 8,827m 7.58 7.58 ─ Increased sales and marketing costs +370bps +370bps +100bps +100bps +50% +50% +32% +32% ─ Lower prices in Consumer Tissue ▪ Strong cash flow and balance sheet 1) Net sales which excludes exchange rate effects, acquisitions and divestments 2) Excluding items affecting comparability 3 July 13, 2020 Half-year Report 2020

Summar Summary Organic ganic Adjusted Adjus ted Adjusted Adjus ted Q2 2020 vs Q2 2019 Net S et Sales ales Net S et Sales ales 1) EBI BITA 2) EBI BITA A Mar argin gin 2) 2) 2) ▪ Strong underlying business performance in a challenging environment SEK SEK SEK SEK 13.3 13.3% 28,407m 28,407m -9.3% 9.3% 3,782m 3,782m x% x% ▪ Sales negatively impacted by COVID-19 and +170bps +170bps -11.4 11.4% +1% +1% related lockdowns and destocking ▪ Adjusted EBITA margin improvement Oper perating ting Ear arnings nings Adjusted Adjus ted Adjusted Adjus ted ▪ Increased market shares in many markets Cash Cas h Flo low per Shar per S hare ROCE CE 2) ROE 2) ▪ Online sales increased with 350 bps to 14% of sales SEK SEK SEK SEK 13.1% 13.1% 15.1% 15.1% 4,346m 4,346m 2.97 2.97 ▪ Successful innovations +20bps +20bps -380bps 380bps 3) +17% +17% -8% 8% 3) 1) Net sales which excludes exchange rate effects, acquisitions and divestments 2) Excluding items affecting comparability 3) A revaluation of deferred tax reduced taxes with SEK 253m in the second quarter of 2019 4 July 13, 2020 Half-year Report 2020

Positiv ositive e Long Long-ter term m De Development elopment 38000 30,00% 7000 17% Net Sales and Organic Net Sales Growth 1) Adjusted EBITA and EBITA margin 2) 6500 16% 36000 25,00% 15.8% 6000 15% 33,68633,712 34000 20,00% 32,565 14.1% 5500 5,333 14% 32,068 32000 15,00% 31,112 13.3% 30,656 5000 13% 4,742 12.8% 30000 29,721 29,647 12.6% 12.6% 10,00% 12.2% 28,664 7.8% 28,407 4500 12% 28,155 28,020 +5.9% 11.6% 4,176 28000 5,00% 27,178 +3.3% +4.3% +3.9% 11.1% 11.3% +3.6% 11.1% +3.4% +2.3% +1.6% 4000 11% 3,782 3,732 +1.8% +1.8% 3,619 10.4% 26000 0,00% -0.1% 3,451 3,437 3,432 10.2% 3500 3,349 10% 3,190 3,119 3,016 24000 -5,00% 3000 9% -9.3% 22000 -10,00% 2500 8% 20000 2000 -15,00% 7% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 Net Sales, SEKm Organic Net Sales Growth, % Adjusted EBITA, SEKm Adjusted EBITA margin, % 1) Organic net sales which excludes exchange rate effects, acquisitions and divestments 2) Excluding items affecting comparability 5 July 13, 2020 Half-year Report 2020

Str Strengt engthene hened d Mar Market et Shar Shares es and Br and Brands ands Positive development past 6 months and long-term Essity has position #1 or #2 in ~90% ~90% of our branded sales Essity’s branded market share in retail has >60% improved in >60% of its market positions in the past 6 months Essity’s branded market share has ~60% improved in ~60% of its market positions in the past 3 years Essity has a market share of 30% or 40% above in 40% of its market positions 6 July 13, 2020 Half-year Report 2020

Net Net Sales Sales Q2 2020 vs Q2 2019 -11.4% Organic Net Sales 1) -9.3% SEK 32,068m -9.8% +0.5% -0.2% +0.1% -2.0% SEK 28,407m Net Sales Volume Price/Mix Acquisitions Divestment Currency Net Sales Q2 2019 Q2 2020 1) Net sales which excludes exchange rate effects, acquisitions and divestments 7 July 13, 2020 Half-year Report 2020

Adjust Adjusted ed EBIT EBITA A Mar Margin gin 1) 1) Q2 2020 vs Q2 2019 +170 bps +320 bps -30 bps -120 bps 13.3% 11.6% ▪ Impact from lower raw material and energy costs +510 bps ▪ COGS savings of SEK 127m Adjusted EBITA Margin Impact Gross A&P SG&A Adjusted EBITA Margin Q2 2019 Profit Margin (excl A&P) Q2 2020 1) Excluding items affecting comparability 8 July 13, 2020 Half-year Report 2020

Raw Raw Ma Material terial De Development elopment Paper for Recycling 1) Market Pulp in USD, Europe 150 140 120 125 100 80 100 60 75 40 Fluff NBSK EUCA SOP US SOP EU Oil-based Raw Materials 2) Energy Prices 3) 150 200 125 150 100 100 75 50 50 0 Electricity, EUR Natural Gas, EUR Polypropylene, EUR Propylene, EUR Source: Fastmarkets RISI, Fastmarkets FOEX, VDP, Macrobond, Epexspot, ICIS Index 100 = July 2017 1) Sorted Office Paper. Index in local currencies. EU refers to Germany 2) Polypropylene major feedstock of non-woven material, Propylene major feedstock of SAP material 3) Electricity Germany. Natural Gas, TTF Index 9 July 13, 2020 Half-year Report 2020

CO COVID VID-19 19 Top priorities Secure Care for Contribute Business Our People to Society Success 10 July 13, 2020 Half-year Report 2020

Secure Busine Secur Business ss Success Success ▪ Positive feedback from customers appreciating our support, service and delivery reliability ▪ Successful innovations ▪ Increased presence and activity in digital sales channels ▪ Strengthened market shares in many markets ▪ Significantly increased awareness of hygiene and health 11 July 13, 2020 Half-year Report 2020

Inno Innova vations tions Q2 2020 12 July 13, 2020 Half-year Report 2020

Incr Increased A eased Awar areness of eness of Hygiene and Health Hygiene and Health Leveraging our leading solutions Anti-bacterial Products Reposition Products Soaps and Sanitizers Tork PeakServe to Hygienic Benefits 13 July 13, 2020 Half-year Report 2020

Per ersonal Car sonal Care Adjusted EBITA 1) Adjusted EBITA Margin 1) Net Sales SEK 12,164m 14.1% SEK 1,711m 13.5% Q2 2020 vs Q2 2019 SEK 10,651m SEK 1,438m -60 -12.4% bps -16% ▪ Organic net sales decreased 9.4% ─ Volume -10.2% and price/mix +0.8% Q2 2019 Q2 2020 Q2 2019 Q2 2020 Q2 2019 Q2 2020 ▪ Sales negatively impacted by COVID-19 and related lockdowns and destocking ▪ Gradual improvement of sales in June Organic Net Sales ▪ Higher prices By Region By Product Segment ▪ Cost savings -0.2% -3.2% -4.1% ▪ Lower raw material costs -9.4% -12.2% -15.9% ▪ Lower volumes and higher distribution costs -25.6% Total Mature Emerging Incontinence Medical Baby Feminine Markets Markets Products Solutions Care Care ▪ Lower sales and marketing costs but higher as % of net sales % of Personal Care Net Sales: 63% 37% 48% 16% 18% 18% 1) Excluding items affecting comparability 14 July 13, 2020 Half-year Report 2020

Consu Consumer mer Tissue Tissue Net Sales Adjusted EBITA 1) Adjusted EBITA Margin 1) SEK 2,124m 17.1% SEK 12,437m SEK 12,167m +82% Q2 2020 vs Q2 2019 +2.2% +750 SEK 1,166m bps 9.6% ▪ Organic net sales increased 4.3% ─ Volume +4.9% and price/mix -0.6% Q2 2019 Q2 2020 Q2 2019 Q2 2020 Q2 2019 Q2 2020 ▪ Higher volumes ▪ Better mix but lower prices Organic Net Sales By Region ▪ Lower raw material and energy costs +12.4% ▪ Higher distribution costs ▪ Higher sales and marketing costs but lower as % of net sales +4.3% -2.3% Total Mature Emerging Markets Markets % of Consumer Tissue Net Sales: 51% 49% 1) Excluding items affecting comparability 15 July 13, 2020 Half-year Report 2020

Pr Prof ofessional essional Hygiene Hygiene Net Sales Adjusted EBITA 1) Adjusted EBITA Margin 1) SEK 7,742m Q2 2020 vs Q2 2019 SEK 1,026m 13.3% SEK 5,315m ▪ Organic net sales decreased 30.7% 9.0% SEK 481m -31.3% -430 -53% ─ Volume -32.2% and price/mix +1.5% bps ▪ Sales negatively impacted by COVID-19 and related Q2 2019 Q2 2020 Q2 2019 Q2 2019 Q2 2020 Q2 2020 Q2 2019 Q2 2020 lockdowns and destocking ▪ Higher prices and better mix Organic Net Sales By Region ▪ Cost savings ▪ Lower raw material and energy costs ▪ Lower volumes and higher distribution costs ▪ Lower sales and marketing costs but higher as % of net sales -30.7% -30.8% -29.5% ▪ Higher sales of dispensers and skin care Mature Emerging Total Markets Markets % of Professional Hygiene Net Sales: 81% 19% 1) Excluding items affecting comparability 16 July 13, 2020 Half-year Report 2020