Reckitt Benckiser reports £1.44 billion of pre-tax profit in H1

Reckitt Benckiser (LON: RB) said on Tuesday that its financial results for the first half (H1) of the ongoing financial year came in stronger than expected. The company attributed its hawkish performance to the Coronavirus pandemic that fuelled the demand for Lysol sprays, Mucinex, and Dettol soap, and cough syrup in recent months. The U.S. based Avery Dennison also published an upbeat earnings report on Monday.

Shares of the company opened about 1.5% down on Tuesday but jumped roughly 2.5% in the next hour. At £77.76 per share, Reckitt Benckiser is currently 25% up year to date in the stock market after recovering from a low of £51.50 per share in March. At the time of writing, the Anglo-Dutch multinational consumer goods company has a market capitalisation of £55.30 billion.

Reckitt Benckiser’s net revenue jumps 12% on a comparable basis

At £1.44 billion, Reckitt Benckiser’s pre-tax profit came in significantly stronger in H1 as compared to £1.26 billion in the same quarter last year. In terms of revenue, the company recorded £6.91 billion in the first half versus the year-ago figure of £6.24 billion. On a comparable basis, its net revenue came in 12% higher on Tuesday.

The company’s board decided to keep the interim dividend unchanged from last year at 73 pence. For the full year, the Slough-headquartered company now anticipates its revenue to increase by high single-digit. It, however, forecasts COVID-19 to results in a 5% to a 6% hit to its net revenue in fiscal 2021. In comparison, A.G. Barr said on Tuesday that it expects a 15% decline in revenue this year.

In North America, the consumer goods company said that its sales came in 70% higher for Lysol disinfectants and 62% higher for Dettol in the first six months of the fiscal year. The good hygiene practices, it added also fuelled growth in emerging markets as well.

Reckitt Benckiser prints a 60% increase in digital sales in H1

In its report on Tuesday, Reckitt Benckiser also highlighted its digital sales to have surged over 60% in H1. Online sales, it added, made up 12% of the company’s net revenue in the first half.

In the second quarter that concluded on 30 June, the Anglo-Dutch multinational company reported a 10.5% increase in comparable sales versus the experts’ forecast of 7.8%.

Reckitt Benckiser had announced plans of expanding its investment by £2 billion in February. On Tuesday, the company said that it will invest an additional £200 million to enhance marketing and consequently sales from its baby formula business in the next two years.