Reckitt Benckiser has raised its net revenue growth forecast for its key “Powerbrands” like Dettol, Nurofen, and Lysol to over 4% for the current year, an increase from the previously projected 3-4% growth.This upward revision comes as the consumer goods giant continues its strategic shift to concentrate on these high-performing brands.
Last year, Reckitt announced a simplification drive, signaling its intention to divest brands that are no longer considered “core” to its business. This includes household names such as Cillit Bang, Calgon, and Air Wick. In line with this strategy, Reckitt recently completed the sale of a majority stake in its Essential Home business to private equity firm Advent International for $4.8 billion (£3.6 billion). Reckitt will retain a 30% minority stake in this divested segment.
The company’s performance in the first half of the financial year highlights the divergence between its core products and the divested Essential Home business. While the Essential home segment experienced a decline of 6.5%, Reckitt’s “core” brands saw a healthy growth of 4.2%. Reckitt reported a like-for-like sales increase of 1.5%, with operating profit rising by 1.8% to £1.7 billion.
CEO Kris Licht described the first half performance as “strong,” attributing it to the resilience of the Powerbrands and the effectiveness of the strategy implemented a year ago. “We have taken a meaningful step to unlocking value with the announced divestment of Essential home,” Licht stated. He further emphasized that the company’s new operating structure has enhanced focus and execution, leading to continued market share gains and volume momentum. Licht also noted the company’s success in Emerging Markets and its ability to navigate a challenging consumer surroundings in Developed Markets.
looking ahead, Licht expressed confidence in the company’s transformation into a more efficient, world-class health and hygiene entity. “While there is still much work to do, the journey to fundamentally reshape Reckitt into a more efficient, world-class health and hygiene company is well underway and reflecting that we are upgrading our life for like net revenue guidance for 2025,” he concluded.
