Press release
Regulated Information

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Aalst-Erembodegem, February 24, 2021 – Ontex Group NV (Euronext Brussels: ONTEX) today announced its results for the three months and twelve months ending December 31, 2020.

  • Revenue: €2,087 million, -9% at reported currencies, -3% LFL vs. 2019 in a context of shifting demand patterns, and lost business in Europe
  • Adjusted EBITDA: €236 million, -4% at reported currencies, with margin of 11.3%
    (+55 bps): Strong procurement gains, favorable raw material indices, partly offset by lower operating leverage
  • Sales and Adjusted EBITDA impacted by major currency headwinds from March 2020
  • Adjusted EPS: €1.01, down 6%
  • Free cash flow: €60 million, net debt down 1.6%, leverage under control at 3.6x at December 31, 2020

New Strategic Priorities

Since being appointed on January 1, CEO Esther Berrozpe has set Ontex’s new strategic priorities to restore growth and value creation targeting the following key areas:

  • Portfolio focus: simplify the business and product portfolio
  • Customer centricity: strengthen customer relations and restore growth
  • Innovation: refocus R&D investments to accelerate the cadence of new product launches
  • Operational excellence: restore manufacturing and service performance
  • Environmental and social: set long-term goals and roadmap
  • Organization & Culture: transform the culture of the group to drive accountability and performance with a streamlined organization

Esther Berrozpe, Ontex CEO, commented: “I am excited to have taken over as CEO of Ontex. The company possesses a number of major assets that once realigned represent significant potential for value creation for our shareholders. Past initiatives have neither been sufficient nor have they delivered the expected benefits. We have already started work on setting our priorities for the future to return Ontex to growth, sustainable margins and cash generation with a solid financial structure. We will share our plans at a later date with the full management team.

I know that I can count on the commitment of Ontex’s employees to rise to this challenge and build a new successful chapter for the Group.”

2021 Outlook

Based on current visibility, we expect a low double digit decrease of Group LFL revenue in Q1 against a high comparable basis in 2020, with Europe’s sales hitting their low point in this quarter. A sales recovery is expected to start in Q2.

The immediate focus is to turn our strategic priorities into deliverable action plans in a context of increasing raw material prices.

We will provide updates on our 2021 prospects as we progress.

Key Financials for FY 2020 and Q4 2020

  Full Year Fourth Quarter
In € million, except per share data 2020 2019 Variance 2020 2019 Variance
Reported Revenue 2,086.8 2,281.3 -8.5% 525.5 592.6 -11.3%
LFL Revenue 2,210.7 2,281.3 -3.1% 570.8 592.6 -3.7%
Adjusted EBITDA 235.6 245.1 -3.9% 52.5 72.7 -27.7%
Adjusted EBITDA Margin 11.3% 10.7% 55 bps 10.0% 12.3% -227 bps
Adjusted EBITDA at constant currencies 309.7 245.1 26.4% 78.0 72.7 7.2%
Adjusted EBITDA Margin at constant currencies 14.0% 10.7% 323 bps 13.7% 12.3% 139 bps
Adjusted profit/(loss) for the period 81.6 86.4 -5.5%
Adjusted EPS 1.01 1.07 -5.6%
Non-recurring income and expenses (37.9) (70.3) -46.2%
Profit/(Loss) for the period 54.0 37.3 44.9%
Basic EPS 0.67 0.46 44.8%
Free Cash Flow 59.5 109.7 -45.8%
Net Debt 847.6 861.3 -1.6%
Net Debt / LTM Adjusted EBITDA 3.60x 3.51x 0.09x


Notes which apply to this document

Unless otherwise indicated, all comments in this document on changes in revenue are on a like-for-like basis (at constant currencies).

Definitions of Alternative Performance Measures (APMs) in this document can be found in note 5 of the Notes to the Consolidated Financial Information.

Due to rounding, numbers presented throughout this press release may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

Dividend related to 2020

The Board of Directors will decide on their proposal for the payment of a dividend related to 2020 ahead of the AGM.

FY 2020 Highlights

2020 was marked by volatility in demand, operating conditions and currencies related to the          COVID-19 pandemic from March onwards.

After a surge in demand drove our first quarter sales to record levels, in particular in Europe, activity dropped sharply in the second quarter, and demand across the traditional distribution channels did not return to pre-pandemic levels. In the second half, our sales were impacted by the pandemic-related shift to online sales, where retail brands are less present. Furthermore, demand decreased in several emerging markets due to economic downturn. Our reported sales also reflect the steep and lasting depreciation of most emerging market currencies.

Revenue of €2,087 million was down 3.1% LFL for the full year 2020, and down 8.5% on a reported basis. This includes a €130 million unfavorable currency effect from the major depreciation of several key functional currencies against the euro, notably the Mexican Peso, Brazilian Real and Turkish Lira. The decrease in LFL sales mainly reflects lower demand for personal hygiene products in tracked retail channels from the second quarter onwards as well as contract losses in Europe, partly offset by a resilient performance in Healthcare and growth in Brazil, Turkey and the US.

Adjusted EBITDA of €236 million in 2020 was down 3.9% compared with prior year, and Adjusted EBITDA margin was up 55 bps to 11.3%. At constant currencies, Adjusted EBITDA stood at €310 million (up 26.4%): Strong procurement savings and lower raw material indices outweighed the impact of lower sales and operating leverage, inflation on costs and COVID-19 related costs for €14 million. The full year currency impact was €74 million unfavorable.

Free cash flow stood at €60 million, down €50 million compared with 2019, on lower cash generation from recurring trade activities and higher outflows related to non-recurring items. Capital expenditure net of disposals was €105 million.

Net debt stood at €848 million at December 31, 2020, a reduction of €30 million vs. September 30, 2020 and €14 million vs. December 31, 2019. Leverage remained under control at 3.60x at December 31, 2020, and we remained in full compliance with our bank debt leverage covenant at December 31, 2020. Net debt excluding IFRS 16 Lease liabilities was €715 million at year-end.

Transform to Grow (T2G)

Ontex generated €66 million of T2G-related gross gains in Adjusted EBITDA at constant currencies in 2020.

The operational workstreams delivered gross gains of €102 million. We remained ahead of our targets in procurement, excluding any benefit from lower raw material indices, but as already reported, the delivery of our improvement targets in manufacturing and supply chain has been taking more time than initially anticipated and was below expectations.

Lower business with several retail brand customers hindered the deployment of planned initiatives to enhance customer value propositions and product mix optimization. Consequently, the T2G commercial workstreams did not deliver the expected benefits, and the unfavorable evolution of volumes and price/mix, as well as marketing investments to support our brands, had a negative impact of €36 million on Adjusted EBITDA in 2020.

The forecast cost for the implementation of T2G over 2019 – 2022 has been reduced by €25 million, from €85 million to €60 million, reflecting lower reorganization expenses as well as cuts in performance-based professional fees and management incentives. As previously disclosed, our capital expenditure for 2020 and 2021, including investments related to T2G, will remain within 5% of net sales.

Operational Review: Categories

  Full Year Fourth Quarter
in € million 2020 2019 % ∆ as reported % ∆ at LFL 2020 2019 % ∆ as reported % ∆ at LFL
Ontex Reported Revenue 2,086.8 2,281.3 -8.5% -3.1% 525.5 592.6 -11.3% -3.7%
Baby Care 1,162.5 1,345.7 -13.6% -7.1% 290.8 356.0 -18.3% -9.3%
Adult Incontinence 679.5 692.0 -1.8% +3.3% 175.8 174.9 +0.5% +8.6%
Feminine Care 212.2 212.7 -0.2% -1.5% 50.0 53.1 -6.0% -9.9%
Other 32.6 30.9 +5.4% +16.8% 9.0 8.6 +5.4% +19.2%

FY 2020 sales in Baby Care decreased by 7.1% versus prior year. After a strong surge at the end of the first quarter triggered by the pandemic outbreak, market demand for Baby Care products contracted in retail channels and accelerated in online channels as consumer purchase habits shifted. Contract losses also accounted for lower sales in Europe. Demand in several emerging markets decreased due to the economic downturn, outweighing growth in Brazil and the US. Overall, baby pants outperformed baby diapers, particularly in the AMEAA Division.

Adult Incontinence products delivered the best category revenue performance for the third consecutive year, growing by 3.3% in FY 2020. Adult Inco sales in retail channels grew 8% thanks to our leading position supplying our retail customers with their proprietary brands in Europe, as well as strong Ontex brand sales in Brazil, Mexico and Turkey. In our Healthcare Division, growth in the self-pay channel, home delivery and e-commerce offset lower activity with hospitals and nursing home due to the pandemic. The shift in demand towards Adult pants continued, resulting in sales growth that outpaced the overall category.

Feminine Care revenue was down 1.5% for the full year 2020. Lower revenue in Europe, from lower in-store demand for retail brands and contract losses, outweighed the growth reported by the AMEAA Division in the first half of the year.

Operational Review: Division

  Full Year Fourth Quarter
in € million 2020 2019 % ∆ as reported % ∆ at LFL 2020 2019 % ∆ as reported % ∆ at LFL
Ontex Reported Revenue 2,086.8 2,281.3 -8.5% -3.1% 525.5 592.6 -11.3% -3.7%
Europe 872.2 956.9 -8.8% -6.8% 220.7 249.7 -11.6% -7.7%
AMEAA 774.1 882.9 -12.3% -0.7% 191.4 235.1 -18.6% -4.0%
Healthcare 440.5 441.6 -0.2% +0.1% 113.4 107.8 +5.2% +6.2%

2019 revenue in AMEAA and Healthcare has been adjusted due to a shift of customer responsibility between these Divisions effective January 1, 2020, which has no impact on total Ontex revenue. Details can be found in annex.


2020 revenue in the Europe Division was down by 6.8%, due to demand contraction from our retail customers from the second quarter onwards as well as a net negative balance of contract gains and losses. Sales of retail brands were impacted by increasing online sales where retail brands are less present, and by intensified competition from A-brands. The sales decrease was mostly due to lower volumes, primarily in Baby Care and to a lesser extent in Feminine Care. Adult Inco sales posted growth. Sales of our online baby diaper subscription service in France, launched in 2019, accelerated strongly.

Americas, Middle East, Africa and Asia (AMEAA)

AMEAA Divisional revenue in FY 2020 ended 0.7% lower compared with a solid 2019 performance. Higher price/mix in all three categories largely compensated for lower volumes, entirely in Baby Care, while Adult Inco volumes were ahead. Americas revenue rose thanks to solid growth in Brazil and the US, while our business in Mexico faced a contraction of demand due to the economic downturn caused by the pandemic. Sales decreased in MEAA, as a strong performance in Turkey, including the ramping up of new business in baby diapers and continued growth of our leading Adult Inco brand Canped, could not offset lower sales in other geographies, many of which faced lower demand due to economic downturn, extended store closures and higher competitive pressure.


Sales in the Healthcare Division in FY 2020 were in line with prior year at +0.1%. Market share gains in fast-growing self-pay channels, as well as strong home delivery and ecommerce activity boosted by lockdown measures offset lower demand from hospitals and nursing homes, whose occupation rates were strongly impacted by the pandemic. Adult pants posted solid growth after the successful relaunch of our main line.



Selected Financial Information

  Full Year
in € million 2020 2019 % ∆
Ontex Reported Revenue 2,086.8 2,281.3 -8.5%
Cost of sales (1,477.7) (1,661.3) -11.0%
Gross profit 609.1 620.0 -1.8%
Operating expenses (373.5) (374.9) -0.4%
Adjusted EBITDA 235.6 245.1 -3.9%
Non-recurring income and expenses (37.9) (70.3) -46.1%
EBITDA 197.7 174.8 +13.1%
Depreciation and amortization (86.8) (87.6) -0.9%
Operating profit 110.9 87.2 +27.2%
Net finance cost (35.7) (37.7) -5.3%
Income tax expense (21.3) (12.2) +74.0%
Adjusted profit for the period 81.6 86.4 -5.5%
Adjusted Basic EPS 1.01 1.07 -5.6%
Profit for the period 54.0 37.3 +44.9%
Basic EPS 0.67 0.46 +44.8%.
Free Cash Flow (after-tax) 59.5 109.7 -45.8%
– Of which change in WC 20.8 69.1 -69.9%
– Of which Capex, net of disposals (105.0) (101.7) +3.2%
– Of which repayment of lease liabilities (26.0) (27.6) -5.7%


Gross profit

Gross profit stood at €609.1 million in FY 2020, a limited decrease of -1.8% versus prior year. Gross margin, however, improved significantly to 29.2% in FY 2020, an increase of 201 basis points versus prior year. Procurement delivered strong savings, leveraging lower raw material indices, but the depreciation of our main functional currencies outside the euro zone versus the USD erased part of this upside, and lower volumes weighed on operating leverage.

Adjusted EBITDA

FY 2020 Adjusted EBITDA was €235.6 million, 3.9% below the previous year, while adjusted EBITDA margin was up +55 basis points to 11.3%. Adjusted EBITDA margin improvement was driven by the gross margin gain. At constant currencies, Adjusted EBITDA was €309.7 million for FY 2020, up 26.4% year-on-year, and the related margin was 14.0%, up 323 basis points.

Non-recurring income and expenses

Non-recurring expenses in FY 2020 totalled €37.9 million, down by 46% compared with 2019. The majority of these charges related to reorganizations, in particular to reduce overhead costs, and litigation. Expenses related to the implementation of T2G recognized in 2020 stood at €0.8 million.

Foreign Exchange

The worldwide outbreak of the pandemic in early March 2020 caused a steep and lasting depreciation of our main functional currencies outside the euro zone, with negative impacts on both revenue and Adjusted EBITDA. The currency impact on Group revenue amounted to ‑€130 million, mainly due to the depreciation of the Brazilian Real and Mexican Peso, and to a lesser extent the Turkish Lira and Russian Ruble, versus the USD and the euro. These currencies also account for most of the -€74 million impact on FY 2020 Adjusted EBITDA.

Net Finance Cost

FY 2020 net finance cost was €35.7 million, down 5.3% compared with last year. The decrease was mainly due to currency impacts on the interest expense related to debt contracted in local currencies.

Income Tax Expense

The FY 2020 income tax expense amounted to €21.3 million, resulting in an effective tax rate of 28.3%, vs. 24.7% in 2019. Tax incentives for industrial investments received in 2019 account for most of the variation.

Working Capital

Working capital* as a percentage of sales, excluding currency effects, was in line with the previous year, reflecting consistent improvements to trade receivables and trade payables, offset by higher inventories at year end, mainly due to a low comparable base at 2019 end as well as lower sales in the fourth quarter. The decrease in reported working capital is essentially due to currency translation, and reflects the depreciation of several of our functional currencies versus the euro.

Capital expenditure

Capital expenditure in FY 2020, net of disposals, was €105.0 million, or 5% of revenue.

Free Cash Flow (after-tax)

FY 2020 free cash flow (after-tax) stood at €59.5 million. The €50.2 million decrease compared with prior year essentially reflects lower cash generation from operating activities, down €48.5 million: €34.6 million from recurring trade activities, mainly due to lower cash from working capital decrease compared with prior year, and €14.0 million from higher cash-outs related to non-recurring items, mainly for overhead cost reduction measures, other reorganizations, consulting fees and litigation.

Net debt and leverage

Net debt stood at €848 million at December 31, 2020, a reduction of €14 million vs. December 31, 2019. Leverage remained under control at 3.60x at December 31, 2020, and we were in full compliance with our bank debt leverage covenant at December 31, 2020. Net debt excluding
IFRS 16 Lease liabilities was €715 million at year-end.

* excluding monetization of accounts receivables through factoring: €156 million at 2020 year end, €161 million at 2019 year end

All definitions of Alternative Performance Measures (APMs) in this press release can be found in Note 5 of the Notes to the Consolidated Financial Information.

Corporate information

The above press release and related financial information of Ontex Group NV for the three and twelve months ended December 31, 2020 was authorized for issue in accordance with a resolution of the Board on February 23, 2021.

Audio webcast

Management will host an audio webcast for investors and analysts on February 24, 2021 at 11:00am CET/10:00am UK. A copy of the presentation slides will be available at

Click on the link below to attend the presentation from your laptop, tablet or mobile device. Audio will stream through your selected device, so be sure to have headphones or your volume turned up.

A full replay of the presentation will be available at the same link shortly after the conclusion of the live presentation.


Q1 2021                            April 28, 2021

AGM                                  May 25, 2021

H1 2021                            July 29, 2021

Q3 2021                            October 28, 2021


Maarten Verbanck

Phone: +32 53 33 36 20

Geoffroy Raskin