Reckitt Benckiser says Dettol demand driven higher by coronavirus
Consumer healthcare giant Reckitt Benckiser (RB) said the coronavirus outbreak has helped to drive greater demand for its Dettol and Lysol hygiene products.
The company said it is also working alongside public health authorities across the world in a bid to provide people in areas affected by the virus with more information about the necessary hygiene measures.
It added that the outbreak has resulted in “increased online activity” for its consumers in China, but that the firm is “seeing some disruption to offline retailers, distribution channels and the supply chain connected to China”.
Nevertheless, RB said it is currently “too early” to assess the impact of coronavirus on the operational and financial performance of the group.
The London-listed firm provided the update as it slumped to a £1.9 billion operating loss for the year despite increasing sales.
The major loss was driven by a £5 billion impairment of goodwill which resulted from its acquisition of the Mead Johnson nutrition business.
The Nurofen and Gaviscon owner also said sales increased by 2% to £12.8 billion for the year to December despite a marginal sales decline in the final quarter.
Net revenue for the fourth quarter dipped 0.5% to £3.3 billion as improving trends in its healthcare business were offset by supply challenges.
It said sales volumes for the year were slightly lower but highlighted strong progress from e-commerce channels and improvements in both its home hygiene and health arms.
The company said it expects 2020 to be a “transitional year” but has seen trading get off to a “strong start”, though it highlighted the “uncertain environment” caused by the coronavirus outbreak.
Chief executive Laxman Narasimhan said: “We ended 2019 broadly in line with our expectations for net revenue growth and adjusted operating profit from October, as our hygiene business delivered another stable performance.
“Health remained weak from a net revenue perspective, but consumption and market share trends are encouraging.
“RB operates in strong, structural growth categories and has an outstanding collection of trusted, market leading brands.
“When combined with an organisation structure that leverages both its category focus with its investment in capabilities at scale, RB is positioned well for faster growth and significant value creation as we look towards the new decade.”