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Disinfectant demand boosts Reckitt Benckiser's quarterly sales
[BENGALURU] Consumer products maker Reckitt Benckiser Plc reported better-than-expected quarterly results on Tuesday, as cautious customers stocked up on Lysol and Dettol disinfectants and Mucinex cough syrup during the coronavirus pandemic.
Like-for-like sales for the three months ended June 30 rose 10.5 per cent, handily beating company-provided estimates of 7.8 per cent.
The Slough-based company also said it expects high-single-digit underlying revenue performance in 2020 compared with the mid-single-digit sales growth initially expected.
The pandemic has relieved pressure on a business that has struggled to cope with intense competition in the health and hygiene space.
People are increasingly cleaning their homes and washing their hands to protect themselves from the coronavirus, a trend which Reckitt Benckiser CEO Laxman Narasimhan expects to continue even when people spend less time indoors.
Customers are also shopping more online, helping Reckitt's e-commerce sales surge more than 60 per cent in the first half of the year, and now accounting about 12 per cent the group's net revenue. Revenue came in at 6.91 billion pounds (S$12.26 billion), above forecasts of 6.81 billion pounds.
The company also announced plans to invest an additional 100 million pounds over the next two years to speed up growth of its disinfectant brands.
The company's strong performance has given a fillip to Reckitt's shares, pushing them up by more than a quarter this year, compared with the FTSE 100's 19 per cent drop.