Reckitt Benckiser, one of the world's largest makers of household cleaners and personal care products, produced double-digit sales and profit growth despite the challenging trading environment, aided by significant media investment and successful launches of Vanish Intelligence and Finish Max in 1.
The group grew total revenue by 13 per cent at constant exchange rates, including an 11-month contribution from the Adams Respiratory Therapeutics business acquired for £1.1bn. Like-for-like growth, which compares performance on a comparable basis, was 10 per cent, spread across all markets and all 17 'Powerbrands'.
Net debt increased to £1,096m, from £125m in 2007, reflecting the financing of the Adams acquisition. That increased the net finance charge to £31m (£24m in 2007). While gearing remains under control, the board is prioritising debt repayment over share buybacks and has cancelled the 2009 programme.
And just days after Unilever said it was unable to forecast 2009 profits, Reckitt said it is targeting current year revenue growth of 4 per cent and net income growth of 8-10 per cent, and is moving immediately to a 50 per cent dividend payout ratio.
Prior to these results, analysts were forecasting 2009 pre-tax profit of £1.62bn and EPS of 172p.
| RECKITT BENCKISER (RB.) | ||||
|---|---|---|---|---|
| ORD PRICE: | 2,744p | MARKET VALUE: | £19.5bn | |
| TOUCH: | 2,743-2,745p | 12-MONTH HIGH: | 3,010p | LOW: 2,314p |
| DIVIDEND YIELD: | 2.9% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 464p* | NET DEBT: | 33% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2004 | 3.87 | 0.76 | 80.7 | 34.0 |
| 2005 | 4.18 | 0.88 | 92.0 | 39.0 |
| 2006 | 4.92 | 0.87 | 93.5 | 45.5 |
| 2007 | 5.27 | 1.21 | 131 | 55.0 |
| 2008 | 6.56 | 1.47 | 158 | 80.0 |
| % change | +25 | +22 | +20 | +45 |
Ex-div: 25 Feb Payment: 28 May *Includes intangible assets of £6.45bn, or 910p a share | ||||
