Reckitt Benckiser bucks trend with strong fourth quarter

By Simon Pitman

- Last updated on GMT

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Amongst the economic doom and gloom Anglo-Dutch personal and household care provider Reckitt Benckiser has posted strong sales growth backed up by impressive profits.

The company said that sales during the quarter rose by 15 per cent at constant currency rates to £1.82bn (€2.02bn, whereas adjusted net income rose by 12 per cent at constant exchange rates to £393m.

"Reckitt Benckiser produced a strong Q4 performance, in line or ahead of expectations on most metrics...and net income was some way above consensus,"​ said Andrew Wood analyst at New York-based Sanford C Bernstein.

For the full year 2008 sales rose by 13 per cent at constant exchange rates to £6.56bn, whereas net income rose by 12 per cent to reach £1.14bn.

The company’s performance was driven by a strong show from all of its 17 major brands, and in particular from its health and personal care brands, which last year accounted for 23 per cent of the revenues.

Global presence in key categories

Key brands include Veet, Dettol amd Clearasil – all of which are global brands that have key market share in major regions such as Europe, the US, Australasia and Japan.

The company is also present in the food and household care categories, where it markets brands such as Vanish, Harpic, Airwick and the food brand French's.

“Beckitt Benckiser had an excellent year in 2008 despite challenging conditions, with like-for-like sales net revenue growth of 10 percent,”​ said company CEO Bart Becht.

All regions and all brands contributed to growth

“All regions and all 17 powerbrands contributed to this growth, supported by significant media investment and successful innovations,” ​said Brecht.

Looking to the future, the compnay said that its targets for 2009 are net revenue growth 4 per cent and net income growth of between 8 – 10 percent, at constant exchange rates.

Wood referred to the 2009 outlook for sales and net profits as being both 'prudent' and 'realistic'.

The estimations are well below the figures that were achieved during 2008, reflecting the fact that tough global economic conditions are likely to impact future growth, but likewise they are well ahead of recent forecasts from competitors, suggesting the company's belief that it is better positioned to weather the oncoming storm.

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