Trading Update
|
Q1 2018 |
£'m |
Proforma** |
Like-for-like* |
Reported |
|
|
|
|
|
|
|
IFCN |
700 |
+6% |
|
|
|
Rest of Health |
1,216 |
+1% |
+1% |
-5% |
|
Total Health |
1,916 |
+3% |
+1% |
+49% |
|
Hygiene Home |
1,195 |
+4% |
+4% |
-3% |
|
Total |
3,111 |
+3% |
+2% |
+23% |
|
|
|
|
|
|
|
North America |
787 |
+5% |
+6% |
+26% |
|
Europe / ANZ |
1,077 |
-1% |
-1% |
0% |
|
DvM |
1,247 |
+5% |
+4% |
+51% |
|
Total |
3,111 |
+3% |
+2% |
+23% |
Highlights: Q1 (at constant rates)
· Proforma growth of +3% (+2% LFL). Proforma and LFL growth were both volume-led (+3%).
· RB 2.0: good progress in both business units.
· Health performance +3% proforma (+1% LFL) against a backdrop of strong trends in IFCN growth and seasonal tailwinds in the US. Strong performances in Gaviscon, Mucinex, Strepsils and VMS brands but significant underperformance in Scholl. Middle East macro issues impacting Dettol.
· Mead Johnson Nutrition (MJN) performance continues to progress well with proforma growth +6% for Q1. Strong market growth in Greater China, and sell in of Enfamil Neuro Pro innovation in the US reinforces the strong fundamentals of this category.
· Hygiene Home had a strong start to the year at +4% LFL driven by a combination of improved in-market execution, seasonal benefit to Lysol in the US and sell in of our new innovations in Finish and Air Wick.
· On track for our full year net revenue target of +13-14% (total constant), implying +2%-3% LFL*.
Commenting on these results, Rakesh Kapoor, Chief Executive Officer, said:
“A solid start overall in Q1, operating under our new organisational structure. RB 2.0 is embedding well and we expect to see the benefits continue to materialise.
The Hygiene Home (HyHo) business has made a strong start to the year with +4% (LFL), aided by some seasonality on Lysol. The performance of the MJN business under RB's leadership is progressing well with strong proforma growth of +6%. Results in the Rest of Health were mixed at +1% (LFL) with good growth in our Health Relief brands, offset by weakness in some of our Health Wellness and Health Hygiene brands. Scholl is stabilising but significantly below the prior year and has reduced the rest of LFL Health performance by -200bps in the quarter. We are addressing our performance in Scholl through acceleration of our pipeline, penetration improvement programmes and streamlining our range.
On a geographic basis we saw a strong performance from North America, which grew +6% (LFL) in the quarter behind broad-based growth across our brand portfolio and a good flu season. China and India continue to perform well. Macro issues continue to persist in the Middle East and Russia.
Our priority remains organic growth under our new focussed organisation structure. The integration of MJN is going well. We have work to do in parts of our Health portfolio, particularly Scholl. I am very pleased to see such energy, focus and a strong start by the Hygiene Home team. I firmly believe RB 2.0 is the right platform for long-term growth and outperformance and we remain well on track to achieve our full year net revenue targets.”