Reckitt lifts sales forecast after reporting upbeat quarter

(Reuters) – Reckitt Benckiser Group on Tuesday raised its full-year forecast after reporting higher-than-expected third-quarter sales, driven by price hikes and a spurt in demand for Mucinex cold and flu remedies as well as for sexual wellness products.

The Lysol cleaning products maker reported a surprise 3.3% rise in like-for-like sales for the third quarter, beating the 0.7% decline analysts had expected, according to a company-supplied consensus.

The reported number and estimates excluded sales from its recently completed sale of its infant nutrition business in China.

The company also raised its full-year net revenue like-for-like sales growth forecast to 1-3% from flat to up 2% earlier, but cautioned that growth would be “softer” in the fourth quarter.

Reckitt said it was seeing a 10% rise in raw material prices, compared with an 8-9% rise it had estimated previously. It cited challenges particularly in areas such as surfactants, paper and tinplate due to a surge in costs.

However, the FTSE-listed company kept its adjusted operating profit margin forecast, excluding IFCN China, for the year in the range of 22.7% to 23.2%.

(Reporting by Siddharth Cavale in Bengaluru; Editing by Anil D’Silva)