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Reckitt Benckiser Group PLC shares rose on Wednesday after the consumer goods firm reported a swing to interim profit due to lower operating costs.
Shares in Reckitt Benckiser were trading 6.2% higher at 6,767.88 pence each on Wednesday morning in London, making it the best FTSE-100 performer.
The Slough, England-based company swung to a pretax profit of £1.69 billion in the first half of 2022, from a loss of £1.94 billion a year before.
Net operating expenses fell 60% to £2.26 billion from £5.64 billion.
Net revenue grew to 4.4% £6.89 billion from £6.60 billion.
The company credited this growth to a temporary uplift in demand for its US Nutrition products due to the supply shortages of infant nutrition products in the country.
‘We estimate this benefit to have added approximately 2.4% to our [like for like] growth rate in [the first half],’ the FTSE 100 company said.
Further, Reckitt reported that brands ‘less sensitive to Covid dynamics’ recorded low double-digit revenue growth in the period. These represent around 70% of its portfolio.
Reckitt recommended an interim dividend of 73 pence, unchanged year-on-year.
Looking forward, Reckitt said it expects growth in adjusted operating margins.
Additionally, company reported that it remains on track to deliver its medium-term goal of mid-20s adjusted operating margins by the mid-2020s.
Due to its ‘strong’ half-year performance, Reckitt also decided to increase its annual like-for-like net revenue growth outlook to between 5% to 8% from 1% and 4%.
‘Despite challenging conditions, we are confident about the rest of the year, we are already delivering sustainable mid-single digit net revenue growth, and remain firmly on track to deliver our medium-term adjusted operating margin goal,’ Chief Executive Laxman Narasimhan said.
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