Consumer health group delivers core growth ahead of medium-term guidance as emerging markets surge and Essential Home disposal completes
Reckitt Benckiser Group PLC (LSE:RKT, FRA:3RB, XETRA:3RB), the maker of Dettol, Nurofen and Durex, said it looks forward "with confidence" after a year in which its core business grew faster than its own medium-term targets, and promised to sustain that momentum into 2026.
The company guided for Core Reckitt like-for-like (LFL) net revenue growth within its 4% to 5% medium-term range for 2026, despite flagging a weaker cold and flu season in the first quarter and a continued difficult trading environment in Europe.
Chief executive Kris Licht said the results were "ahead of our expectations," citing the company's geographic footprint, portfolio of Powerbrands and simplified organisational structure as the foundations for sustainable long-term growth.
Core Reckitt, which excludes the divested Essential Home household cleaning division and infant formula brand Mead Johnson Nutrition, delivered LFL net revenue growth of 5.2% in 2025, ahead of the 4% to 5% medium-term guidance range.
Emerging markets were the standout performer, growing 14.6% on a LFL basis, with double-digit growth in China, India, Indonesia and Colombia, driven by strength in Intimate Wellness, Germ Protection and Self Care.
Europe declined 1.4% on a LFL basis, weighed down by a challenging consumer environment, lower cold and flu incidence and competitive pressure in household cleaning. North America grew 0.2% for the full year, though momentum improved in the second half, with LFL growth of 1.8%.
Group LFL net revenue growth, excluding Essential Home, was 5.0%, with total reported net revenue rising just 0.3% to £14.2 billion, held back by foreign exchange headwinds of 2.9%.
Group adjusted operating profit rose 5.3% at constant exchange rates to £3.54 billion, with the adjusted operating margin expanding 40 basis points to 24.9%.
This was supported by the Fuel for Growth cost reduction programme, which trimmed fixed costs by 150 basis points to 19.4% of net revenue. Reckitt said it now has confidence in pushing that fixed cost base below its initial 19% target by the end of 2027.
Reckitt returned £2.3 billion to shareholders during 2025, including a £1.6 billion special dividend paid in February 2026, representing excess capital from the sale of Essential Home to Advent International for £2.2 billion, which completed on 31 December 2025. The company retains a 30% equity stake in the acquisition vehicle.
Free cash flow fell 23.4% to £1.71 billion, reflecting higher restructuring costs and tax payments connected to the disposal. Net debt declined to £6.56 billion, equivalent to 1.6 times adjusted earnings before interest, tax, depreciation and amortisation, down from 2.0 times a year earlier.
Adjusted diluted earnings per share rose 1.1% to 352.8p. The board proposed a final dividend of 127.8p per share, taking the full-year dividend to 212.2p, a 5% increase.