Consumer goods giant Reckitt Benckiser delivers strong sales growth to end year

Consumer goods giant Reckitt Benckiser delivered better-than-expected sales growth in the fourth quarter led by strong performances from its health and hygiene businesses.

The figures

Revenue in the fourth quarter rose two per cent to £3.34bn when compared with the same period in 2017.

A four per cent like-for-like sales growth for the quarter beat a consensus of 3.3 per cent.

Operating profit for the full year rose 11 per cent to £3.05bn led by a 13 per cent jump in its health business.

Revenue also climbed 10 per cent to £12.6bn in 2018 from £11.45bn the previous year.

Why it’s interesting

The FTSE 100 firm said its health business delivered four per cent like-for-like sales growth in the final three months of 2018, driven by its Enfamil and Nutrimagen baby food products.

The company’s hygiene and home division also enjoyed a fourth consecutive quarter of four per cent like-for-like sales growth with strong performances from its Harpic, Lysol, Air Wick and Vanish brands.

Its products performed well in developing markets too, with Durex condoms and Dettol posted strong growth in China.

But a “weak start to the flu season”, with lower incidences of cold and flu across the US and Europe, hit Strepsils sales in the fourth quarter.

It also made headway with the integration of Mead Johnson Nutrition, which it acquired in 2017.

Last month it announced that chief executive Rakesh Kapoor would retire at the end of this year, and that the search for his successor had begun.

What the company said

Chief executive Rakesh Kapoor said: “2018 was a year of good financial progress, achieved in an environment of both significant change within the company and challenging market conditions.

“We delivered the upper end of our 2018 revenue growth target, and accelerated the delivery of MJN cost synergies versus ingoing expectations.”