Key facts
- Essity's professional hygiene business generates 40% of its revenue in the US.
Essity, the Swedish maker of Tork paper towels, is experiencing greater weakness in its US restaurant clients compared to European ones, according to CEO Ulrika Kolsrud. The company's professional hygiene business, which relies heavily on US sales, saw declines in sales, volumes, and prices in the third quarter amid rising inflation and a cooling job market.
The slowdown in US restaurant dining directly impacts Essity's professional hygiene segment, which generates a significant portion of its revenue in the US. This indicates a broader consumer spending pullback affecting businesses that rely on discretionary spending.
Essity, the Swedish maker of Tork paper towels, is experiencing greater weakness in its US restaurant clients compared to European ones, according to CEO Ulrika Kolsrud. The company's professional hygiene business, which relies heavily on US sales, saw declines in sales, volumes, and prices in the third quarter. This trend reflects broader strains on US consumers, whose wages are struggling to keep pace with inflation while companies pull back on hiring. US consumer prices rose 3.7% in September from a year earlier, outpacing average hourly wage growth of 3.0%. A recent survey indicated that only 39% of Americans eat at restaurants at least once a week, down from 53% in 2019. Essity is again raising prices across its business areas to offset higher raw material and energy costs.
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