Reckitt reports a dip in revenue but remains confident in achieving full-year targets, anticipating growth in the final quarter.
- The company experienced a 0.5% decrease in like-for-like net revenue in Q3, with a minor annual gain by 30 September.
- Hygiene and health sectors saw growth, while the nutrition division faced a significant 17.3% decline due to supply issues.
- A new company structure, launching in January 2025, aims to enhance focus on high-margin brands and optimise portfolios.
- Reckitt continues its strategic share buyback, with CEO Kris Licht expressing confidence in future plans and resilience.
Reckitt has announced a marginal decrease in like-for-like revenue as it contends with lingering post-pandemic challenges. Reporting a 0.5% drop for the third quarter, the company nevertheless achieved a slight revenue increase for the year ending 30 September. Overall, Reckitt saw a 4% decrease in net revenue for the third quarter and a 3.8% drop over the entire year up to the end of September.
Despite these setbacks, Reckitt maintains a positive outlook for the full year, with expectations of robust like-for-like net revenue growth in the upcoming quarter. The company saw growth in its hygiene and health sectors, expanding by 2.1% and 3.2% respectively during the third quarter. However, the nutrition division was notably impacted by a 17.3% decline in sales, primarily due to £100m in supply-related issues caused by the Mount Vernon tornado earlier this year.
Moving forward, Reckitt is set to implement a new operating structure in January 2025, reorganising into three distinct divisions: Reckitt, Essential Home, and Mead Johnson Nutrition. This strategic reorganisation aims to sharpen focus on high-margin Powerbrands, while also evaluating opportunities for the non-core Essential Home and Mead Johnson Nutrition sectors.
The company has recently appointed new leaders across its global leadership team, ensuring all significant roles are filled as it advances its strategic goals. Additionally, it has made significant progress in its share buyback programme, having completed £321m of the intended £1bn initiative revealed earlier this year.
Chief Executive Officer Kris Licht noted the company’s resilience, stating, “Our third quarter delivery is in line with our guidance at the half year. Health delivered sequential improvement in the quarter and hygiene delivered a solid quarter of growth despite a more competitive market backdrop in developed markets.” Speaking on the future outlook, Licht added, “We are moving at pace on the execution of reshaping Reckitt through sharpening our portfolio, simplifying the organisation and improving shareholder returns.”
Reckitt remains agile and forward-looking, strategically aligning its operations and leadership to achieve sustained growth despite current challenges.
