STOCKHOLM (Reuters) -Hygiene products maker Essity reported a slightly bigger-than-expected drop in first-quarter operating profit on Friday, but said it expected COVID-19 vaccination programmes to boost demand for many of its products.
Operating earnings for the period fell 32% to 3.48 billion crowns ($413.3 million) on an organic sales drop of 10%, following restrictions and lockdowns to slow the COVID-19 pandemic. Analysts had expected a profit of 3.64 billion crowns, according to Refinitiv IBES data.
"Improved market conditions resulting from the ongoing vaccination programmes are expected to result in increased demand for several of Essity's product categories," the Swedish company said.
Significantly higher sales in China in the first quarter, and an increase in demand in North America at its professional hygiene division pointed to that, according to Essity.
The company said it expects a previously announced restructuring programme to "contribute to Essity's total annual cost savings of 500 million to 1 billion crowns through the optimization of the production structure, productivity improvements and raw material and energy savings".
($1 = 8.4211 Swedish crowns)