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Reckitt Benckiser fighting fires on many fronts

Day ahead: Flag waving unlikely as under pressure Reckitt Benckiser reveals first quarter sales
picture of Vanish packet
Sales growh is under pressure at Reckitt

Reckitt Benckiser PLC (LON:RB.) first quarter numbers on Friday will still bear the scars of the scandal in South Korea that saw over 100 people die from a toxic humidifier sanitiser.

But that isn’t the Cillit Bang and Dettol group’s only concern.

Sales generally have been below par and its recent acquisition Mead Johnson has added to the market’s unease due to its hefty price tag.  Mead will report standalone results this time around

According to Berenberg, the market has already priced in that RB will start 2017 slowly.

“Reckitt is still suffering from loss of sales in South Korea and the failed Scholl innovation “

But Berenberg remains a fan and sees a return to 5% top-line growth later in the year to make 4% for the year overall.

Barclays is also erring on the cautious side in this update.

A combination of the de-listing in South Korea, failed Scholl/Amope innovation and disruption in India as well as Brazil, Russia and Turkey add up to a growth suppressant, believes the broker.

Even so expect like-for-like growth of 3% and moderate margin expansion with headline sales growth of 0.9% to £2.62bn.

‘Equalweight’ is the broker’s view and 7,230p the price target.


Friday 21 April

Interims: Schlumberger(LON:SCL) 

AGM/EGM: Symphony International Holdings Ltd (LON:SIHL)

Trading statement: Reckitt Benckiser (LON:RB.)

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