By Matteo Castia
Reckitt Benckiser Group PLC reported on Tuesday a swing to pretax loss for the first half of the year on lower revenue and higher costs.
The consumer-goods company--which houses Dettol, Harpic and Durex among its brands--posted a pretax loss of 1.94 billion pounds ($2.68 billion) for the six months, including a hit of GBP3.20 billion from losses on assets held for sale and disposal of goodwill and brands. This compares with a profit of GBP1.44 billion in the year-earlier period.
Revenue came in at GBP6.60 billion, down from GBP6.91 billion the prior year. A consensus estimate taken from FactSet and based on three analysts' projections had forecast Reckitt Benckiser's first-half revenue at GBP6.72 billion.
The board declared an interim dividend of 73 pence, flat on the year.
"Cost inflation accelerated in the second quarter and it will take time to offset this headwind with productivity and pricing actions being implemented in the back half of the year and early next year," the FTSE 100 company said.
The increasing costs will largely offset the margin accretion from the $2.20 billion disposal of IFCN China, which remains scheduled for completion in the second half, Reckitt Benckiser said.
Reckitt Benckiser also said it expects a weak third quarter due to the tough year-earlier comparatives but that its flu and cold business will pick up in the fourth quarter.
"Overall demand in the disinfectant category remains significantly higher than pre-Covid levels and the two-year stacked growth of our hygiene portfolio is up 34.1%," the company said.
Reckitt Benckiser said it anticipates mid-single digit revenue growth in 2022.
Write to Matteo Castia at email@example.com
(END) Dow Jones Newswires
July 27, 2021 02:59 ET (06:59 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.