Household products manufacturer Reckitt Benckiser capped 2020 with the strongest sales in its history, as the COVID-19 pandemic made hygiene a top priority and fuelled demand for its cleaning products.
The company said it expects sales in 2021 to come in flat or up 2%, slightly slower than the pace it saw in 2020 due to tough comparables versus last year, while lower birth rates also kept a lid on sales of items such as Enfamil baby formula.
The Slough-based company said a strategic review was underway for its infant formula business in Greater China, and added that it would sell its Scholl foot products unit to private equity firm Yellow Wood Partners and acquire Biofreeze pain relief gel from Performance Health.
The terms of both transactions were not disclosed, but the company said deals would initially be earnings-neutral.
Reckitt reported an 11.8% rise in like-for-like sales growth for the full year, its largest increase since being formed in 1999, but marginally lower than the 11.9% growth forecast by analysts in a company-supplied consensus.
Like-for-like annual sales surged 25.7% in the company's hygiene business, mainly driven by strong performances from Lysol and Finish.
Commenting on the group's performance, Laxman Narasimhan, chief executive, said, "We have made a strong start to implementing our new strategy and proved that we can adapt and successfully respond to rapidly changing market conditions. Our portfolio is clearly resilient - with or without COVID-19 - and we are building a stronger business for the future.
"Our category-leading germ protection/disinfection brands have all seen substantial market growth, with around 80% of our consumers expecting to retain many of their new improved habits post pandemic. We capitalised on these new behaviours with Dettol and Lysol entering 41 markets, with plans to enter a further 29 markets in 2021. Our new Global Business Solutions unit is expected to contribute c.100bps to Group revenue growth in 2021."
News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.