30th Oct 2018 11:17
LONDON (Alliance News) - Nurofen painkiller maker Reckitt Benckiser Group PLC on Tuesday maintained its annual revenue target as it reported a drop in third quarter revenue due to a temporary manufacturing disruption in Europe.
In the three months to September 30, the consumer goods company posted total net revenue of GBP3.12 billion, down from GBP3.21 billion recorded the year before.
Reckitt said that, while the disruption at its at its European Infant Formula & Child Nutrition manufacturing plant was temporary and resolved within the quarter, it is likely to have some residual impact on the final quarter of the year.
Revenue from Reckitt's Infant Formula & Child Nutrition division fell 8.5% to GBP659 million from GBP720 million year-on-year.
The company's Total Health division, which includes over-the-counter health products as well as infant formula, recorded net revenue of GBP1.90 billion in the third quarter. Reckitt said this represents a 3% drop on a reported basis and flat like for like growth.
Hygiene Home division recorded revenue of GBP1.23 billion, flat on a reported basis and up 4% on like-for-like terms.
Reckitt restructured its divisions in 2017 by combining different businesses.
Year-to-date, however, revenue was up 13% at GBP9.26 billion from GBP8.22 billion, led a by an overall 25% reported increase in Total Health, particularly within North America and developing markets.
Reckitt Chief Executive Officer Rakesh Kapoor said the manufacturing disruption occurred "during a period of unusually high market growth" and before the opening of new Australian facilities.
Kapoor said Reckitt has "sufficient momentum and progress" to absorb the disruption and reiterated the company's target of between a 14% and 15% growth in net revenue for the year, as constant rates, implying like-for-like revenue growth at the upper end of 2% to 3% range.
In August, Reckitt extended its compensation plan relating to the sale of the Oxy RB Humidifier Sanitizer in Korea, which was linked to lung and respiratory injuries and deaths. Applications for compensation remain open for an indefinite period. Since July, 152 applications were received but no lung injury categorisations were made.
At present, Reckitt is also involved in ongoing investigations by the US Department of Justice, as well as the US Federal Trade commission, and in related litigation in the US surrounding RB Pharmaceuticals.
Reckitt demerged from RB Pharmaceuticals in December 2014, whereupon the pharma business was renamed as Indivior PLC. At present, Reckitt anticipates that it "may incur liabilities" relating to RB Pharmaceuticals.
Shares in Reckitt were down 5.0% at 6,284.00 pence on Tuesday.
Related Shares:
RB..L