Looming over Haleon PLC (LSE:HLN, NYSE:HLN) as it reports third-quarter numbers on Thursday 10 November are a couple of big issues.
The date itself is important, and this is when an overhang from the combined 45% stake owned by former parents GSK PLC (LSE:GSK, NYSE:GSK) and Pfizer could start to come into play.
When Haleon was spun out as a separately listed company earlier this year, Pfizer held a 32% stake and GSK around 13.5%.
They are prevented from selling under a lockup agreement that will be lifted whenever Haleon publishes third-quarter results or 10 November, whichever happens first (though they happen to be on the same day).
It was previously thought that Pfizer would hold on to its stake after the spin-off, but the US drugmaker announced prior to the spin-off that it planned to sell out of its holding in a “disciplined manner”.
Credit Suisse acknowledged at the time of the IPO that a larger-than-expected selldown from Pfizer and GSK is one of the big risks for the shares.
Haleon also has been under another overhang from the Zantac litigation claims that have hit GSK hard, though the consumer health group said it was not a party to any claims and has also notified its former parent and joint venture partner that "it rejects their requests for indemnification".
Recently analysts at Barclays were impressed by the group's plans for organic sales growth and strengthening its balance sheet.
Having not seen any downtrading for its brands such as Sensodyne, Aquafresh, Panadol and Advil, they noted that "Haleon believes its categories to be resilient to consumer downtrading, although acknowledged that these are unusual times".
"Most of its portfolio is therapeutic in nature and does not form part of a weekly shopping basket, which should provide a degree of insulation."
Significant growth possibilities are seen for Paradontax, which has a focus on bleeding gums and has only been meaningfully launched and activated in a dozen or so markets, and for reinvigorating the Centrum vitamin brand.
While deleveraging is a priority, the analysts noted that Haleon's leverage "is an issue for some investors", mostly in the UK with US investors "seeming less concerned", and the businss being "a capital light and highly cash generative business, with a low (30%) starting dividend payout ratio".