Shares in the Nurofen maker Reckitt Benckiser Group PLC (LSE:RKT, ETR:3RB) fell 11% with the market spooked by its fourth-quarter sales miss and a £55 million revenue hit related to compliance issues at two of its Middle East operations.
At 11.05 am, the stock was off 654p at 5,184p after the company revealed the trading drag was the result of lower-than-expected demand for cold and flu remedies and voluntary recall of its Nutramigen infant formula.
On the issue of the adjustment to net sales, Reckitt, which also makes Air Wick and Cillit Bang, said: "Following investigation, we concluded a small group of employees had acted inappropriately and we are taking necessary disciplinary action.
"We are confident this is an isolated incident specific to these two markets and does not impact our 2024 outlook and medium-term goals."
UBS in a note, said Q4 sales missed consensus and undershot consensus by around 2.8% percentage points as they fell by 1.2% with the Nutrition business flagged as the worst performer (down almost 15% on a like-for-like basis).
Reckitt's adjusted operating profit for the 12 months ended December 31 was £3.37 billion, a small decline from £3.44 billion previously.
Against this backdrop, UBS remains a 'buyer' with a price target of 7,170p.