British consumer goods maker Reckitt Benckiser has boosted revenue targets for the year, as the Dettol-maker benefited from its £13 billion deal to buy Mead Johnson, sending its shares up over 8 per cent. It raised its annual net revenue growth expectations to between 14 to 15 per cent, higher than its previous target of 13 to 14 per cent. The maker of Durex condoms and Lysol disinfectant said its infant and child nutrition division, the acquired Mead Johnson business was experiencing strong growth above medium-term expectations, led by China, the world's largest market for the products.
Full year like-for-like sales growth is also expected to come in at the higher end of its 2 to 3 per cent range, Reckitt said, also signalling a recovery at its Scholl footcare brand. Once a pace-setter for the industry's sales growth, the company has been through hard times lately with Scholl dragging on sales for two years after the failure of electronic foot file that cost upwards of $40 to smooth dry heels. However, Reckitt said that it did not expect a material drag on its second-half results from Scholl. It posted a total net revenue growth of 4 per cent on a like-for-like basis, while pro-forma revenue rose 5 per cent to £3.02 billion for the three months ended June 30.
Reckitt said the pro-forma growth was helped by 3 per cent volume growth and a 1 per cent boost from pricing mix in the second quarter. Morgan Stanley analysts said, “Still plenty to do to get back to the Reckitt Benckiser of old but after 8 disappointing quarters in a row, this is an important step in the right direction.”
