Reckitt lifts full-year forecast as mobility, vaccinations choose up
- Q3 like-for-like gross sales up 3.3% vs -0.7% est.
- Lifts full-year income forecast to 1-3% from 0-2%
- Sees present inflation traits persevering with into subsequent yr
- Shares up 5.8%, high FTSE gainer
Oct 26 (Reuters) – Higher vaccination charges and improved mobility in the course of the third quarter drove sturdy demand for Mucinex cough syrups and Durex condoms, Reckitt Benckiser Group (RKT.L) mentioned on Tuesday, prompting it to lift its full-year forecast.
That despatched its shares up 5.8% in morning buying and selling, making it the highest gainer on the FTSE (.FTSE) index.
Sales of over-the-counter medicines rose greater than 20% within the quarter, pushed primarily by Mucinex cough and chilly cures after a robust chilly and flu season noticed gross sales throughout most of its markets are available at or above 2019 ranges, it mentioned.
Improved mobility in markets together with India additionally noticed the corporate achieve share in sexual wellness merchandise similar to Durex, Chief Executive Laxman Narasimhan mentioned on a media name.
That drove like-for-like gross sales up 3.3% within the quarter, in comparison with the 0.7% drop analysts had anticipated, in line with company-supplied estimates, which excluded gross sales from the not too long ago accomplished sale of its toddler diet enterprise in China.
The firm additionally raised its full-year internet income like-for-like progress forecast to 1-3% from flat to 2% earlier, however cautioned that progress can be “softer” within the fourth quarter.
Like its friends, Reckitt mentioned it was seeing a pointy rise in uncooked supplies prices, which had been up 10% within the quarter in contrast with an 8-9% rise it had estimated beforehand.
Chief Financial Officer Jeff Carr mentioned he anticipated inflation to be “up a touch” within the fourth quarter and probably within the low double digits in 2022, however couldn’t estimate when these larger prices would subside.
“There will be another round of pricing we will take to offset the inflation,” Narasimhan mentioned, over and above the 1.7% hikes it took within the third quarter.
Domestos maker Unilever (ULVR.L) final week additionally warned of one other spherical of value hikes to battle fierce inflation. learn extra
Reckitt stored its adjusted working revenue margin forecast, excluding IFCN China, for the yr within the vary of twenty-two.7% to 23.2%
Shares within the group had been down 16% this yr earlier than the outcomes, after hitting near-record ranges in 2020.