Dettol and Durex maker Reckitt shares slump after 'unsatisfactory' sales drop

28 February 2024 , 12:46

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Household goods giant Reckitt has revealed a sales dip over the last quarter (Image: No credit)

Reckitt, the company behind Dettol and Durex, has reported an "unsatisfactory" drop in sales over the last quarter.

The firm's shares took a hit as it also revealed that its revenues for the past year were about £55 million less than expected due to a mistake in financial reporting in the Middle East. The company found that trade expenses for the fourth quarter and previous quarters of 2023 had been understated, which also affected adjusted profits by around £35 million.

“Following investigation, we concluded a small group of employees had acted inappropriately and we are taking necessary disciplinary action,” the company said. “We are confident this is an isolated incident specific to these two markets and does not impact our 2024 outlook and medium-term goals.”

The news comes as the group, which also makes Nurofen and Gaviscon, reported a 1. 2% fall in like-for-like net revenues over the final quarter of 2023, with overall net revenues down 7% to £3. This included a 2% drop in its health division due to the "timing and pattern of the cold and flu season", while like-for-like nutrition volumes fell by 14. 8%.

Kris Licht, the CEO of Reckitt, said: "While our performance in Q4 was unsatisfactory, we look to 2024 and beyond with confidence. We target another year of mid-single-digit growth in Health and Hygiene, driven by a more balanced contribution from price, mix and volume."

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Reckitt said that its like-for-like revenues for the full year went up by 3. 5% in 2023 compared to last year, thanks to increases in its hygiene and health businesses. The firm now predicts it will get like-for-like revenue growth of between 2% and 4% next year. Shares in the company dropped by 9. 9% early on to 5,258p.

Lawrence Matheson