Haleon PLC (LSE:HLN, NYSE:HLN) upped its outlook for organic revenue growth and profits this year as the Sensodyne and Panadol maker benefited from increasing its prices to offset cost inflation.
The FTSE 100-listed consumer health group, which was spun out of GSK in the summer, said it now expects organic revenue to grow 8.0-8.5% over the full year, with adjusted operating profit margin “slightly above” last year, at actual exchange rates.
Previously it had guided to 6-8% organic growth and margin “slightly down” at constant currency rates.
For the third quarter to end-September, the company reported 8.1% year-on-year organic growth, which was down from the 11.6% growth in the first half.
Price growth was 5.5% in the quarter, up from 3.7% in the first half, while volume/mix growth slowed to 2.6% from 7.9%.
Accelerated growth was seen in Oral Health brands, and Respiratory did well as the cold and flu season started in the northern hemisphere, whilst Vitamins, Minerals and Supplements were flat.
Reported operating profit was up 12.2% to £569mln, with margin improving to 19.7% from 17.3% in the first half but down 70 basis points (bps) from a year earlier.
Adjusted operating profit, which mostly excludes £142mln of separation and admission costs, increased 14.9% to £725mln, with margin at 25.1%, up from 23% in the first half and down 90bps at constant currency on last year.
Chief executive Brian McNamara hailed the increased pricing through the year and continued positive volume/mix, and said the company was “demonstrating its strength in a challenging market environment”.
Having published third-quarter results, former parents GSK PLC (LSE:GSK, NYSE:GSK) and Pfizer Inc (NYSE:PFE) can now start to sell down their combined 45% stake.
When Haleon was spun out as a separately listed company in July, Pfizer held a 32% stake and GSK around 13.5%.