By: Chandrashekar Bhat
RECKITT’S net revenue rose 3.5 per cent to £13.23 billion in 2021, driven mainly by its hygiene products.
The consumer goods company expects a “mid-single” growth in its net revenue during the current year on a like-for-like basis.
Its chief executive officer Laxman Narasimhan said it targeted growth in 2022, “despite an unprecedented inflationary environment and uncertainties created by Covid.”
Around 70 per cent of its portfolio, representing brands less sensitive to the pandemic, grew mid-single-digits in 2021 and the rest of its products including Lysol and Dettol were more volatile, reflecting fluctuations in the Covid-related demand.
Its net revenue grew at 3.3 per cent in the October-December quarter over the corresponding period in 2020, benefitted by the strong demand for health products.
However, the British company reported an operating loss of £804 million for the full year against the previous year’s profit of £2.16 bn as the strategic review and disposal of IFCN China eroded £3.35 bn.
In September last year, Reckitt had announced that it sold the Chinese child nutrition business to Primavera Capital Group for an implied enterprise value of $2.2 bn (£1.62 bn).
Geographically, the company’s highest net revenue growth of six per cent for the full year came from developing markets, particularly India and the Middle East, compared to 2.9 per cent in North America and a more modest 1.5 per cent in Europe/Australia and New Zealand.
In absolute terms also, the net revenue from the developing market was the highest at £4.71 bn against £4.2 bn from North America and £4.31 from Europe and Australia.
On the overall performance, Narasimhan said, “over the last two years, we’ve significantly strengthened our business. Our innovation pipeline is 50 per cent larger, our brands are stronger and more relevant, and our ability to serve our customers and consumers is greatly improved. We’ve taken Reckitt’s strong performance-driven culture, with its unique sense of ownership, and are evolving it for the better. We’ve also been active in managing our portfolio, repositioning for faster growth”.