Ontex, a nappy manufacturer based in East Flanders, has significantly revised its outlook for the current year following a weak first half, the company announced in a statement alongside its half-year results on Wednesday.
The company now expects an annual revenue decline of less than 10%, having previously aimed for growth between 3 to 5%. Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation) is now projected to be between €200 million and €210 million, down from an initial forecast of 4% to 7% growth.
These adjustments follow a challenging first half, where revenue dropped by 4% to €880 million. The baby care division was particularly impacted, with a 9.8% decline due to weak demand and intense promotional pressure from branded manufacturers.
Adjusted EBITDA also fell sharply, decreasing from €110 million to €86 million year-on-year, a 21.5% decline, attributed to reduced volumes and selling prices.
Despite this situation, CEO Gustavo Calvo Paz is optimistic for the year’s second half. He expects a sales recovery driven by the start of confirmed contracts in North America and Europe, and the anticipated end of disruptions in European supply chains.
In recent years, Ontex has embarked on a strategic transformation, refocusing its operations on Europe and North America. The sale of its Brazilian subsidiary was completed in April, and the company is also divesting from its Turkish operations. Additionally, the closure of its Eeklo plant in East Flanders, which employed 338 people, was completed early this year, while the Buggenhout site in East Flanders underwent significant restructuring.
