Ontex Records a 21% Year-Over-Year Performance Decline

Annual and Quarterly Financial Performance

Ontex reported a revenue of 1,762 million euros in 2025, down by 4.9% on a like-for-like basis. This decline mainly reflects a 5.0% decrease in volumes, concentrated in the baby care division with a 12% decline. The company attributes this contraction to a reduction in market demand, particularly in Europe where consumer volumes decreased by a mid-single digit, exacerbated by logistical constraints affecting its supply chain in the first half of the year. Adjusted EBITDA fell to 176 million euros from 223 million euros in 2024, representing a contraction of 47 million euros. The decline reflects the impact of a 40 million euro decrease in revenue, including insufficient absorption of fixed costs, combined with a net charge of 8 million euros related to temporary operational inefficiencies. The adjusted EBITDA margin contracted by 2.0 percentage points to 10.0%. The fourth quarter saw a revenue of 436 million euros, down by 7.6% year-over-year. Baby care volumes dropped by 16.7% during this period, while feminine care volumes decreased by 4.6%. Only the adult care segment showed stability. The quarter's adjusted EBITDA was 39 million euros, down from 57 million euros a year earlier.

Costs and Operational Efficiency

Raw material costs increased by about 4%, generating a negative impact of 38 million euros, particularly for packaging materials and superabsorbent polymers. Other operating costs rose by about 8%, for an impact of 44 million euros, reflecting wage inflation and logistics services as well as temporary inefficiencies. The cost transformation program delivered 69 million euros in net savings, representing an operational efficiency gain of about 5% despite the volume decline. These gains stem from actions in procurement, logistics, manufacturing efficiency including the restructuring of the Belgian operational footprint, and product design. SG&A costs decreased by 6 million euros, or 3%, thanks to spending moderation offsetting wage inflation. On the financial side, operating income stood at 79 million euros, compared to 76 million euros in 2024. Net financing cost reached 51 million euros. After accounting for a loss of 190 million euros from discontinued operations related to the divestment of Emerging Markets activities in Brazil and Turkey, the group recorded a net loss of 173 million euros against a profit of 10 million euros in 2024.

Cash Flow and Financial Position

Free cash flow before financing reached 18 million euros, affected by the reduction in adjusted EBITDA and an outflow of 30 million euros for restructuring. Capital expenditures stood at 81 million euros, representing 4.3% of the group's revenue. Ontex received 131 million euros from disposals, including 95 million euros from the sale of Brazil and 30 million euros from the sale of Turkey. Net financial debt was 577 million euros as of December 31, down from 612 million euros at the beginning of the year. However, the leverage ratio increased from 2.46x to 3.29x due to the reduction in EBITDA. The group proceeded with the early refinancing of its 580 million euros senior bond maturing in July 2026, issuing a new bond of 400 million euros at 5.25% due in 2030. The liquidity position is comfortably set at 240 million euros, including 70 million euros in cash and 170 million euros unused from its revolving credit facility. For 2026, Ontex anticipates a persistently challenging market environment with soft baby care demand and sustained promotional activity by major brands. However, demand in adult care is expected to remain supported by demographic and societal trends. The company aims for a gradual improvement in performance throughout the year, supported by the ramp-up of recently won contracts and the continuation of the cost transformation program.