Reckitt sales growth cheer

RECKITT Benckiser cheered investors with improved trading and expects the faster sales growth to continue as it seeks to bounce back from a string of setbacks.

The consumer products giant behind brands such as Nurofen, Dettol and Durex posted an 8 per cent rise in annual adjusted operating profit to £3.36billion on 10 per cent higher revenue of £12.6billion. Like-for-like sales grew by 3 per cent, accelerating to 4 per cent in the fourth quarter after a pick up in both its health and hygiene/home businesses.

Shares rose 279p to 6296p as investors welcomed the last annual figures to be overseen by chief executive, Rakesh Kapoor, who is retiring after more than eight years in charge.

As well as separating health and hygiene/home products into two separate businesses, Reckitt has been bedding in the £13.3billion US baby formula maker Mead Johnson Nutrition it bought two years ago.

But progress has been overshadowed by a safety scandal in South Korea, manufacturing problems in the Netherlands and a failed Scholl footcare product.

Kapoor said: “2018 was a year of good financial progress, achieved in an environment of both significant change within the company, and challenging market conditions.

“We are well positioned for long term, sustainable growth from the excellent portfolio of brands. We expect momentum to continue, and target 3-4 per cent like-for-like net revenue growth.”

George Salmon, equity analyst at Hargreaves Lansdown, said: “Whoever takes over will be inheriting an attractive business, but after incurring the disruption of a cyber attack and the infant nutrition business still causing a few sleepless nights, there are teething problems to overcome. We wouldn’t rule out the new CEO following in the footsteps of GlaxoSmithKline and overseeing a break-up of the business.”