Reckitt products

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Consumer goods giant Reckitt Benckiser has performed below City expectations in 2023 as like-for-like revenues declined 1.2% in a “unsatisfactory” fourth quarter.

A difficult cold and flu season affected the group’s health division in the final three months of the year, with like-for-like sales falling 2%, while the nutrition arm plunged 14.8% as challenges in North America continued to hurt trading.

Reckitt said it also identified an understatement of trade spend in two Middle Eastern markets related to the fourth quarter and prior quarters of 2023, meaning full-year net revenue performance was £55m lower than previously expected.

Following an investigation, the group concluded a small group of employees had acted “inappropriately”, with disciplinary action being taken by the company.

“We are confident this is an isolated incident specific to these two markets and does not impact our 2024 outlook and medium-term goals,” Reckitt said.

Revenues for 2023 topped £14.6bn, reflecting adjusted like-for-like net growth of 3.5%.

Its hygiene division grew LfL revenues by 5.1% thanks to an average rise in prices of 11.1%, with volumes tumbling 6%.

Adjusted operating profits for the year also fell 1.9% to £3.4bn.

CEO Kris Licht called 2023 “a year of progress” for Reckitt, highlighting “a good trading performance” in health and hygiene.

“While our performance in Q4 was unsatisfactory, we look to 2024 and beyond with confidence,” he added.

Reckitt predicted LfL net revenue growth of 2-4% for the group in 2024.

Bernstein analyst Bruno Monteyne said the Reckitt disappointed across the board.

Shares in the group plunged 9% to 5,326p as markets opened.

Morning update

Just Eat Takeaway has improved adjusted underlying profits in 2023 despite orders and gross value transaction declining as cash-strapped consumers opted for fewer takaways.

GTV fell 6% to €26.4bn and orders tumbled 9% to 891 million, but the group said it was in growth if North America was excluded from the figures.

Northern Europe and the UK and Ireland both exited 2023 at their highest ever quarterly GTV level, although order numbers still declined.

2023 adjusted EBITDA was ahead of guidance at €324m and the group made an overall loss of €1.8bn as a result of impairment charges of €1.5bn.

CEO Jitse Groen said the group “significantly” improved its financial performance in all segments.

“Our enhanced profitability resulted in reaching the critical milestone of returning to positive free cashflow in the second half of 2023,” he added.

“I am particularly pleased with the strong momentum in the UK and Ireland, with adjusted EBITDA margin rapidly approaching a similarly high level as Northern Europe. Overall, the business is in a strong position to capture further improvement to our topline performance, adjusted EBITDA and free cashflow in 2024.”

Glanbia has called its 2023 performance “excellent” thanks to strong global consumer demand for its performance nutrition products.

Revenues declined 8.7% to $5.4bn in the year, with Glanbia Performance Nutrition seeing like-for-like growth of 5.1% but the Glanbia Nutritionals division declined 12.3%.

Group EBITDA, before exceptional items, jumped 15.9% to $424m.

CEO Hugh McGuire said: “Glanbia is a company with very strong fundamentals - a clear strategy, a portfolio of great brands and ingredients playing into strong underlying consumer health and wellness trends with a team of talented people.

“Looking ahead, we will focus on driving growth and shareholder value by stepping up awareness and distribution of our great brands, with a robust innovation pipeline across both our growth platforms.”

Glanbia also launched a €50m share buy-back programme.

The FTSE 100 opened down 0.2% to 7,667.06pts.

Just Eat sank 5.6% to 1,212p on the back of its results, while Glanbia jumped 6.8% to €16.46.

Early risers included Bakkavor, up 2.3% to 97.4p, B&M European Value Retail, up 1.7% to 525.8p, Greencore, up 1.1% to 104p, and Nichols, up 1% to 1,000p.

Yesterday in the City

The FTSE 100 closed flat yesterday at 7,683.02pts.

McBride raced 20.4% higher to 88.6p after the own label household cleaning products supplier roared back into the black in the first half, with profits of 17.4m versus a £20m a year ago.

Kitwave’s shares fell 2.6% to 297p as CEO Paul Young announced he would be stepping down in March. The group also reported significant growth in both revenue and adjusted operating profit in 2023.

Fallers included Imperial Brands, C&C Group, THG and Unilever, down 4.8% to 1,730.5p, 2.3% to 151.7p, 2.4% to 64.4p and 2% to 3,915.5p respectively.