Reckitt Benckiser Chief Executive Aims For Comeback
Reckitt Benckiser Group Plc says it’ll bounce back from its worst year ever as it wrings more savings from its acquisition of baby-formula maker Mead Johnson Nutrition Co.
The Slough, England-based maker of Durex condoms and Nurofen painkillers forecast that comparable sales will rise by 2 percent to 3 percent in 2018, after the first 12-month period of stagnant sales in the company’s history.
The shares fell as much as 3.8 percent early Monday in London as Morgan Stanley analysts led by Richard Taylor described the outlook as conservative.
The company is eyeing a comeback from a year marred by a cyberattack and lackluster demand for new products. Chief Executive Officer Rakesh Kapoor has moved to separate its home-care and health businesses, sharpening a focus on brands such as Strepsils and Mucinex.
On a comparable basis, sales were up 2 percent in the fourth quarter.
Reckitt became a leader in infant nutrition with the acquisition of Mead Johnson last year. On Monday, it increased its forecast for synergies from the deal to about $300 million from $250 million.
“We returned to growth after a solid finish to the year, our acquisition of MJN is firmly on track and the creation of two business units -- RB Health and RB Hygiene Home -- will drive long-term growth,” Kapoor said in a statement.
The company said it sees 4 percent to 6 percent midterm growth in consumer health, which has been expanding more rapidly than the home-care operations.
Reckitt Benckiser is one of two remaining bidders vying to acquire Pfizer Inc.’s consumer-health business, which includes brands such as Advil and ChapStick lip balm, according to people familiar with the matter. U.K. drugmaker GlaxoSmithKline Plc is the other.
A takeover, which could fetch as much as $20 billion, would be the company’s largest since the Mead Johnson deal. On a call Monday, Kapoor declined to comment on a possible bid.