Ontex moves forward with strategic transformation and reports higher EBITDA in Q3
Sale of Brazilian operations and optimization in Belgium strengthen focus on key markets and growth in North America and Europe
Ontex, an international leader in the personal hygiene sector, released its financial results for the third quarter of 2024, revealing significant progress in its ongoing transformation.
Revenues for the third-quarter totaled €468 million, a 1.7% comparable growth, driven by volume gains and increasing demand in adult care and new clients in baby care in North America. Adjusted EBITDA was €56 million, 29% higher than the previous year, due to volume and mix growth, along with the execution of the cost transformation program.
Net financial debt fell to €579 million, with the leverage ratio improving from 2.5x to 2.4x. The company maintains its expectations for 2024, with an adjusted EBITDA margin of 12%, revenue growth between 2% and 3% on a comparable basis, free cash flow above €20 million, and a leverage ratio below 2.5x.
STRATEGIC DEVELOPMENTS
Ontex has signed an agreement to sell its operation in Brazil to Softys SA, with an enterprise value of approximately €110 million. The expected net amount of €82 million is anticipated to be received at closing, scheduled for the first half of 2025, subject to customary conditions. Additionally, the social negotiations for transforming the Belgian operation were successfully concluded in October, as part of Ontex’s optimization efforts, with extraordinary costs estimated at €66 million, of which €37 million were recorded in the second quarter.
Gustavo Calvo Paz, CEO of Ontex, highlighted the strategic advancements: “With the agreement to sell our Brazilian operations, Ontex’s transformation is marking a major milestone, shifting our focus even more to retail brands and healthcare in the rapidly growing North American market and in the streamlined European market. Finalizing social negotiations to optimize our European manufacturing footprint has been another milestone to realize that. Meanwhile we delivered solid results, allowing us to confirm our adjusted EBITDA margin and free cash flow expectations, which is an excellent achievement for the entire Ontex team”.
