Health and hygiene business ‘on track for sustainable growth’

Hull-based health, hygiene and home produce company Reckitt Benckiser Group (RB) has posted sales of £6.6bn in the first half of 2021, representing 1.5% growth on a LFL basis.

The company also reports a a pre-tax loss of £1.9bn (2020: £1.4bn pre-tax profit)

RB says it expects the third quarter to be slower due to stronger prior year comparators, adding that it is encouraged by the quarter two trends in its cold and flu portfolio. It also forecasts a moderate season to strengthen its performance in the fourth quarter.

Based on the current situation, it continues to expect like-for-like net revenue growth to be within the 0-2% range set out in February 2021.

Laxman Narasimhan, chief executive officer, said: “Against a challenging environment, I am encouraged by the progress we have made in the first half of the year.  

“Around 70% of our revenue, excluding IFCN China, is from brands growing by mid-single digits in the period, in line with our strategic vision.

“The remaining 30% includes our disinfection brands, which are structurally rebasing, as well as our cold and flu brands, which are now starting to show positive momentum. 

“Overall demand in the disinfectant category remains significantly higher than pre-COVID levels and the two-year stacked growth of our hygiene portfolio is up 34.1%, compared to a normal growth rate, pre-COVID, of around 4%. 

“The markets are dynamic, reflecting several factors which we are closely monitoring, including the prevalence of COVID strains and Government guidelines such as new lockdowns and social distancing.

“Although the third quarter will be slower due to strong prior year comparators, as the world gradually opens up and socialisation returns, cold and flu trends indicate a moderate season which should strengthen performance in the fourth quarter.

“We expect to exit 2022 with a revenue growth run rate in the mid-single digits as we make our way towards our medium-term adjusted operating profit margin target in the mid-20s by the mid-20s.”