Ontex released its 2025 annual report, revealing a year of performance below initial expectations, marked by declining consumption of baby care products, increased competitive pressure, and a direct impact on financial results.
The company recorded a 5% decline in LFL (like-for-like) volume, negative free cash flow of €25 million, and an adjusted EBITDA margin of 10%, down two percentage points. Still, the period was characterized by strategic execution and business restructuring.
“2025 was a challenging year for Ontex, and our performance did not meet our initial expectations. At the same time, it was a year of focused execution, during which we took decisive actions to strengthen our foundations and prepare the company for sustainable value creation. We completed our refocus on Europe and North America, continued to improve efficiency, and reinforced the depth, relevance, and speed of innovation across all our categories,” said Laurent Nielly, CEO of Ontex.
One of the main moves during the year was the completion of the divestment process of operations in Brazil and Turkey, consolidating the company’s focus on Europe and North America.
The strategy prioritizes private label brands and solutions for the healthcare segment, with a more disciplined allocation of resources in markets considered more strategic in the long term.
The market environment was challenging, especially in the baby diaper segment, impacted by declining birth rates and strong competition from leading brands with aggressive promotional strategies. On the other hand, the adult care segment became the company’s main category, representing 46% of the portfolio, driven by population aging and growing demand for incontinence solutions.
Despite the drop in volumes, the company advanced in operational efficiency, with industrial optimization and cost transformation programs generating €69 million in savings throughout the year.
Innovation also gained relevance, with investments in R&D expanding the company’s ability to develop more affordable and sustainable solutions. Highlights include new products in baby care and feminine care, as well as the use of lower environmental impact materials, such as bioSAP and recycled packaging.
On the financial side, the company completed the refinancing of its debt, extending maturities and reducing risks, while also reducing net debt to €577 million, despite negative cash flow.
Governance was also strengthened with the addition of new board members, increasing diversity of experience and support for the company’s strategy.
The company also progressed in its ESG agenda, reaching 39% of recycled or renewable content in packaging and obtaining external recognition, such as a “A” climate rating from CDP and a Gold rating from EcoVadis. Additionally, it expanded regional sourcing of raw materials, aiming for greater supply chain resilience and lower emissions.
OUTLOOK FOR 2026
For 2026, the company projects a gradual improvement in performance, supported by new contracts, continued efficiency programs, and financial discipline.
The company also announced a broader strategic review, assessing its portfolio, operations, and cash generation, with the goal of unlocking value and strengthening long-term competitiveness.
