Revenue for Core Markets increased 4%
In the first quarter of 2024, Ontex’s revenue for Core Markets (continuing operations) was €460 million ($493 million), up 4% like for like compared to the first quarter of 2023, driven by 10% higher adult care sales, which more than compensated for stable revenue in baby care and slightly lower sales in feminine care. Including slightly adverse forex effects, total revenue growth was 3% year on year.
Volume and mix was up 5% year on year, driven by double-digit growth in selected categories, especially in North America. The strong increase in that region contrasted with continued lower market demand there and was largely based on new contracts that kicked in during the second half of 2023 and in the first quarter of 2024. Further, volume growth in the year will be supported by additional secured contracts. The year-on-year comparison was also supported by the customer destocking in the first quarter of 2023 which depressed order levels at that time.
In the European market, demand for baby care products remained soft. Promotional activities by branded players, trying to recover volume losses incurred last year, temporarily tempered the share gains of retail brands. Retail brands continued to outperform stable demand in feminine care, however. And in adult care, where demand continued to grow supported by societal trends, retail brands gained market share. Ontex’s sales volumes in Europe overall reflected these market trends, including double digit growth in selected categories such as adult care, especially in the healthcare channel, and such as baby pants.
Prices were down 1% on average compared to last year. While in certain categories, such as healthcare, prices were still slightly higher than in the first quarter of 2023, as these contracts typically have a longer term and are more rigid, on average prices have been coming down sequentially since the second half of 2023, reflecting the raw material price decreases which had started earlier that year.
Forex fluctuations had an adverse impact of 1% year on year. The depreciation of the Russian ruble, and to a lesser extent the U.S. and Australian dollar, more than offset the appreciation of the Polish zloty and the British pound.
