Reckitt Benckiser shares increase 1.4% to 6,300p in early morning trading on Friday, after the consumer goods firm reported a 5.6% boost in total net revenue to £3.4 billion in like-for-like sales in its Q1 2022.
The group said it attributed its growth to continued broad-based growth and market share momentum across all businesses and territories, with 76% of its core category market units either gaining or holding market share.
However, Reckitt Benckiser saw its reported total net revenue fall 2.3%, with hygiene falling 10.7% and nutrition dropping 14.8%.
The firm reported a 15.8% reported gain in health as a result of an increase in OTC, VMS and Intimate Wellness growth, with a 20.6% uptick to £1.4 billion on a like-for like basis.
The company also saw a 20.4% rise to £557 million for nutrition on a like-for-like basis linked to a 30% US IFCN growth with strong execution, despite the hurdle of temporary competitor supply problems.
However, the firm experienced a 9% drop in like-for-like sales across its hygiene department, despite noted gains in its Finish, Air Wick, Harpic and Vanish brands as a result of the company’s penetration building initiatives.
The company also confirmed the ongoing offloading of its Russian arm, which it said might include a transfer to a third party or to local employees, moving on from the firm’s decision earlier in the year to freeze all capital investments and marketing in the country after the Ukrainian invasion on 24 February.
Reckitt Benckiser said 70% of its portfolio less sensitive to Covid-19 dynamics grew in the high-single digits.
The group added that its outlook estimated a 1-4% like-for-like net revenue growth at the upper end of management expectations, with adjusted operating margins in line with the previous year and current executive projections, despite significant cost inflation across the board.
“We have made a strong start to the year across all our business units and geographies despite a challenging operating environment. Investments we have made in brand building, innovation, and execution, have resulted in broad-based market share gains. These, coupled with pricing and revenue management actions, stand us in good stead to maintain this positive momentum,” said Reckitt Benckiser CEO Laxman Narasimhan.
“As we look to the balance of the year, the operating environment remains highly unpredictable. We are well placed to address these market dynamics through the strength of our brands, our favourable product mix, our productivity program and the responsible pricing initiatives already undertaken, with scope to take further actions.”
“Given our strong start, we expect to deliver LFL net revenue growth at the upper end of our guidance for the year. We expect adjusted operating margins to be in-line with both the prior year and current market expectations, whilst continuing to invest in the long-term growth of our brands.”