Core Insights - Ontex's CEO highlighted a significant sequential improvement in profitability for Q3 2025, driven by new contracts and effective execution of the transformation program, indicating confidence in achieving a strong end to 2025 despite challenging market conditions [1] Q3 2025 Results - Revenue for Q3 2025 was €445 million, reflecting a 3.8% like-for-like decrease compared to Q3 2024, with volumes down 3.9% due to softer consumer demand for retailer brands [4][9] - Adjusted EBITDA was €51 million, with a margin of 11.4%, down €6 million year-on-year, entirely due to the revenue drop, but improved by €15 million compared to Q2 2025 [6][13] - The cost transformation program yielded €16 million in net savings, offsetting higher raw material prices and inflation-driven operating cost increases [14][15] Business Segment Performance - Adult care revenue increased by 0.5% year-on-year, while baby care revenue decreased by 12.5%, and feminine care revenue rose by 5.4% [4] - Baby care volumes were significantly impacted, down 11% overall, while feminine care volumes increased by 5% [10] Financial Indicators - Operating profit from continuing operations was €29 million, significantly higher than €8 million in 2024, with net financial debt reduced to €543 million from €552 million [7][19] - The leverage ratio remained stable at 2.7x, reflecting a slight decrease in net debt and lower last-twelve-months adjusted EBITDA [2][19] 2025 Outlook - Despite soft market conditions, Ontex maintains its full-year outlook, focusing on cost efficiencies and volume gains as key drivers [3]

Core Insights - The company reported disappointing second quarter results, primarily due to a decline in consumer demand in the baby care segment, which fell at a high single-digit rate [1][5][6] - The full-year outlook has been revised, now expecting low single-digit revenue contraction and adjusted EBITDA in the range of €200-210 million [5][10] - Despite the weak performance, the adult care business is growing, and the company is making progress in its strategic initiatives [3][8] Financial Performance - Revenue for H1 2025 was €880 million, reflecting a 4.0% like-for-like decrease, with baby care revenue down by 9.8% [5][6][12] - Adjusted EBITDA for H1 2025 was €86 million, down from €110 million in 2024, resulting in a margin contraction of 2.2 percentage points to 9.8% [5][12] - Free cash flow was negative at €(40) million, impacted by lower EBITDA and increased capital expenditure [9][12] Market Dynamics - The baby care category experienced a 9.8% revenue decline, attributed to weak consumer demand and heavy promotional activity from branded players [6][12] - The adult care segment saw a 2.6% revenue increase, driven by stable demand in both retail and healthcare channels [6][12] - Temporary supply chain disruptions in Europe affected production and distribution, but these issues are being resolved [6][8] Strategic Initiatives - The company is focused on a cost transformation program that delivered €34 million in net savings, reducing operating costs by 5% despite lower volumes [9][12] - New contracts in North America and Europe are expected to contribute to revenue growth in the second half of 2025 [2][8] - The company is reshaping its portfolio and strengthening its balance sheet, which is anticipated to improve resilience to market fluctuations [3][8]