COVID-19: Dettol-maker cleans up as pandemic demand drives record sales | Business News

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Reckitt Benckiser has reported record annual sales following high demand for its cleaning products and disinfectants during the coronavirus pandemic.

Reckitt Benckiser (RB), which includes the Dettol and Cillit Bang brands in its stable, said group like-for-like sales rose by almost 12% to £14bn during 2020 as consumers sought means to protect themselves from COVID-19.


Its hygiene division saw comparable revenues rise by almost 20% while it also expanded into 40 new markets as production of disinfectant sprays and wipes was ramped up.

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RB’s brands include Strepsils, Vanish and Durex. Pic: RB

RB pointed to market share gains for many of its brands, including Durex, and reported that 80% of consumers planned to maintain their purchases of germ protection and disinfection brands.

But it predicted group revenues would be flat to slightly higher in the current year as peak demand had been reached – a factor reflected in the share price reaction from investors as the stock was only fractionally up on the day in early afternoon deals.

The dividend was maintained at 174.6p-per-share too, despite the sales performance.

Operating profits fell slightly to £3.3bn as a result of the company’s £750m investment spend.

It is banking on a series of new hygiene contracts, with the likes of London Underground and British Airways, to bolster sales growth in the years ahead.

The bar is cleaned in a Wetherspoons pub The Mossy Well in Muswell Hill, London, ahead of pubs reopening on July 4, as further coronavirus lockdown restrictions are lifted in England. PA Photo. Picture date: Wednesday July 1, 2020. See PA story HEALTH Coronavirus. Photo credit should read: Yui Mok/PA Wire..
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RB says a new hygiene contract venture is expected to account for 1% of group sales this year

RB expected that the contracts would account for 1% of group revenue in the current year.

The company also announced it would sell its Scholl footcare products business to private equity firm Yellow Wood Partners for an undisclosed sum.

Chief executive, Laxman Narasimhan, said 2020 had proved a “turning point” for the company.

He told investors: “We expect 2021 to be a year of further strategic progress and we remain confident that we will meet our medium-term targets.”

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said of the FTSE 100 firm’s performance: “Reckitt’s
getting its house in order with a spring clean.

“Like other consumer giants, Reckitt’s biggest challenge is positioning itself as a more focused and agile beast.

“While Scholl has a strong brand, it’s a bit of an anomaly when you look at the wider picture – the shoe just doesn’t fit.”


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