Wednesday 17 July 2019

No indigestion here: sales and profits up at Gaviscon maker

Reckitt has reported full-year figures (PA)
Reckitt has reported full-year figures (PA) Business Desk Business Desk

Gaviscon maker Reckitt Benckiser has reported rising full-year sales and profits, despite the group flagging "challenging market conditions".

The Durex-to-Gaviscon firm reported a 10pc rise in full-year revenue to £12.6bn (€14bn) in 2018, while operating profit rose 11pc to £3bn (€3.4bn).

Pre-tax profit rose from £2.5bn to £2.72bn.

Pro forma like-for-like sales in 2018 were up 3pc while, in the fourth quarter, net revenue was up 2pc at £3.4bn and like-for-like sales rose 4pc.

Outgoing 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 Mead Johnson cost synergies versus our ingoing expectations."

Reckitt said last year that it expects growth in baby formula sales to slow due to declining birth rates in China.

It also saw third-quarter sales affected by a £70m hit from problems at its European baby formula factory.

But the group is targeting comparable revenue growth of 3pc to 4pc in 2019 and expects to maintain its operating margin.

The FTSE 100 listed group snapped up baby milk maker Mead Johnson in a mammoth $18bn deal in 2017, and the deal delivered synergies of £158m in the period.

Reckitt said it is on track to achieve its increased synergy target of $300m.

Last month Reckitt announced that Mr Kapoor is to retire after more than eight years at the helm and 32 years with the company.

He will stand down by the end of 2019 and the household goods giant has launched the hunt for his replacement.

PA Media

Also in Business