Key Takeaways:
Reckitt Benckiser Group Plc reported first-quarter sales that fell short of analyst estimates, as a mild cold and flu season and the war in the Middle East hampered demand for its products, sending shares down around 6 percent in London trading.
"Sales of seasonal over-the-counter medicines declined by double-digits due to the weak cold and flu season as retailers reduced inventory levels through the quarter," Reckitt said in a statement. CEO Kris Licht also cited "weak categories in Europe" and geopolitical disruption from the conflict in the Middle East as further drags on performance.
The Dettol and Lysol maker said its core business posted a 1.3 percent increase in like-for-like net revenue for the three months ended March, missing company-compiled consensus that ranged from 1.6 percent to 2.9 percent. Reported net revenue was £3.25 billion, a decline from £3.68 billion in the prior-year period.
The results underscore the challenges facing the consumer goods giant, which contrasts with rivals like Danone that recently reported stronger sales. Reckitt’s performance was uneven across regions, with emerging markets providing the main growth driver on a 7.6 percent LFL sales increase. This was offset by a 4.2 percent decline in Europe and a 0.9 percent drop in North America.
Despite the soft start to the year, Reckitt maintained its full-year guidance, continuing to expect like-for-like revenue growth of 4 percent to 5 percent for 2026. The company said it anticipates a pickup in demand in the U.S. and continued strength in markets like India and China.
The unchanged guidance suggests management is confident it can navigate the current headwinds, including an estimated £150 million in added input costs from the Middle East conflict. Investors will be watching the company's next earnings release to see if the expected pickup in demand materializes to meet the full-year target.
This article is for informational purposes only and does not constitute investment advice.
