Essity profit drops as new CEO takes the helm

Essity AB reported a drop in second-quarter profit and sales, citing a weak economy and unfavorable currency effects in the first earnings report under new Chief Executive Ulrika Kolsrud.

The Swedish hygiene products maker said on Thursday that net profit for the period fell to 3.05 billion Swedish Kronor from 3.33 billion kronor a year earlier.

Net sales decreased 6.6% to 34.19 billion kronor, the company said.

Essity said that while higher sales prices helped offset increased costs, limited volume growth and negative currency impacts weighed on earnings.

Organic sales, which strip out currency effects and acquisitions, grew 1.9%, driven by higher prices.

The company noted challenging conditions in its Baby Care division due to low birth rates and lower demand in its Professional Hygiene unit from the hotel and restaurant sector.

“I see significant potential in the company and it is with great enthusiasm that I take on the task of accelerating Essity’s profitable growth together with all fantastic employees,” said Ms. Kolsrud, who took the helm on June 1.