Haleon cautions lower margins as it navigates the market as a standalone business
Sensodyne-owner Haleon, the world’s largest consumer healthcare company, has cautioned that its operating margins may be lower than last year, after splitting from its parent company GlaxoSmithKline (GSK) earlier this month.
Adjusted operating margin for the full year is expected to be slightly down at constant currency, in comparison with the 22.8 per cent growth it recorded in 2021.
However, organic revenue growth for the newly demerged company is now expected to be between six and eight per cent.
Revenue climbed 13.4 per cent to £5.1bn in the six months to 30 June, up from £4.5bn a year prior, when its business still fell under GSK’s wing.
CEO Brian McNamara said a stronger demand in cold and flu medicines, such as the firm’s Panadol, Theraflu, and Advil products, had buoyed revenue despite the up to £200m it took for Haleon to become a separate entity.
“With two strong quarters delivered and continued momentum into the second half, we now expect to deliver full year organic revenue growth ahead of our medium-term guidance range,” said McNamara, who headed the consumer division while it was a GSK business.
The between £175m and £200m in standalone costs that Haleon will have swallowed will be largely offset by revenue growth, as well as Pfizer’s 32 per cent stake, bosses said.
Haleon also drew down £1.5bn term loan earlier this month, which was used in part to settle the dividends paid to GSK, which owns 68 per cent of the company, and Pfizer.
It comes on top of some £10bn in inherited debt, which onlookers have said spooked investors from its market debut last Monday.