Nurofen maker Reckitt Benckiser sticks to targets despite ‘slow start’ to 2019
Reckitt Benckiser experienced a “slow start” to the year as like-for-like sales grew just one per cent annually, its chief executive admitted today.
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Home hygiene products grew three per cent year on year for the first three months of 2019 to outperform flat like-for-like growth in its health sector.
Overall net revenue stood at £1.9bn, flat on the year before, while volume dropped four per cent on weak over the counter (OTC) sales, which declined nine per cent year on year.
Boss Rakesh Kapoor said: “As expected, Q1 saw a slow start to the year, especially in OTC. We expect to see improving growth in the remainder of the year, particularly in H2.”
He blamed “unusually weak” cold and flu season across the US and much of Europe for poor health performance, though Nurofen and Gaviscon delivered solid growth while its infant health and nutrition division saw sales rise five per cent year on year.
However, cold and flu picked up in March, with retailer stocks “back in line” with expectations.
US sales grew two per cent on a like-for-like basis to £376m, offsetting flat growth in Europe where sales hit £535m.
Developing markets saw a big nine per cent rise to £311m.
“Restoring outperformance in our Health BU remains our top priority as we target innovation-led growth, invest and outperform in e-channels, invest behind the equities of our brands, and build a more resilient business,” Kapoor said.
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Reckitt stuck to its 2019 targets of between three and four per cent like-for-like sales growth.