STOCKHOLM (News release) -- Hygiene and health company Essity is launching measures to create better conditions for profitable growth. Actions include an organizational change that decentralizes decision-making and strengthens end-to-end accountability for each product category, and a cost savings program that is expected to generate annual savings of approximately SEK 1bn with full effect by the end of 2026.
"Today, we're launching measures to create better conditions for Essity to increase its growth rate going forward and to faster achieve our targets," says Ulrika Kolsrud, President and CEO, Essity.
The organizational change will simplify Essity's structure and create end-to-end accountability. This will further enhance customer and consumer focus, increase speed, agility, and operational efficiency. The change facilitates increased strategic focus on the product categories and segments with the greatest potential for profitable growth.
The new organization will consist of the business areas Health & Medical, Personal Care, Consumer Tissue, and Professional Hygiene, with clear overall responsibility in each business area for innovation, production, marketing and sales. The current Consumer Goods business area will be split into Personal Care and Consumer Tissue. Essity's global units Global Marketing & Innovation and Global Supply Chain will be integrated into the four business areas.
Tuomas Yrjölä, President Global Marketing & Innovation, has been appointed President Personal Care. Volker Zöller, President Consumer Goods EMEA, has been appointed President Consumer Tissue. Anand Chandarana and Pablo Fuentes have been appointed President Health & Medical and President Professional Hygiene, respectively, also in the new organization.
The changes will apply as of January 1, 2026. Essity's new structure will be reflected in the financial reporting as of the interim report for the first quarter of 2026.
The cost savings program primarily targets sales and administrative expenses, while marketing costs (A&P) are not in scope. The program is expected to generate annual savings of approximately SEK 1bn, with full effect by the end of 2026, and part of this amount will be derived from the organizational change. The cost savings will mainly be invested in profitable volume growth.
The savings generated by the program will be reported and are in addition to the costs of goods sold (COGS) savings that the company continuously reports, where the target of annual savings of SEK 0.5-1bn stands firm. Restructuring costs will mainly be related to workforce reductions and will be reported in conjunction with the interim report for the fourth quarter of 2025 at the latest.
