Reckitt Benckiser Group (LON:RKT) reported 3.3% like-for-like net revenue growth in the third quarter, or 3.9% excluding Russia Hygiene, as strength in emerging markets and a return to growth in Europe were partly offset by supply constraints and a weaker consumer environment in North America.
Chief Executive Officer Kris Licht said growth was increasingly broad-based across markets and supported by both volume and mix. However, the company reduced its full-year 2026 organic revenue outlook to growth of 3.5% to 4.5%, citing a temporary manufacturing disruption affecting Lysol supply in the U.S. and slower growth in China’s cross-border vitamins, minerals and supplements category.
North America supply disruption weighs on quarter
North American like-for-like revenue declined 1.3% during the quarter, below Reckitt’s expectations. The company said upgrades to a small number of production lines at a Hygiene factory in St. Peters caused more downtime than anticipated, limiting its ability to supply Lysol products.
Licht said the problem was one of supply rather than demand. Lysol sell-out grew in the low single digits during the quarter and the brand continued to gain market share year to date, but Reckitt was unable to fulfill some promotional activity and experienced out-of-stocks on shelves.
The company expects Lysol and the North American business to rebound in the fourth quarter as manufacturing capacity improves. Reckitt is investing up to $600 million in its North American supply chain, including $400 million for a new Self Care factory in North Carolina and approximately $200 million for upgrades to two Hygiene plants.
Chief Financial Officer Shannon Eisenhardt said the broader North American consumer environment weakened in the quarter, driving greater value-seeking behavior and more competitive activity, particularly in automatic dishwashing. Finish revenue in North America declined by the mid-single digits.
Reckitt also reported retailer order phasing in the drug channel toward the end of the quarter, which it expects to reverse in the fourth quarter. The company said price investment, including some penalties related to the Lysol supply constraints, more than offset positive volume and mix in the region.
Emerging markets lead growth while China VMS slows
Emerging markets delivered 8% like-for-like revenue growth, or 9.8% excluding Russia Hygiene. India, ASEAN and Africa each posted double-digit growth, while Latin America and China grew at mid-single-digit rates.
Reckitt said all of its Self Care and Germ Protection power brands grew by double digits in emerging markets, while Finish also posted double-digit growth excluding Russia. In India, growth was broad-based across categories, though the company expects a tougher comparison in the fourth quarter following prior GST-related benefits.
China’s growth slowed from its previous run of double-digit quarters as the cross-border VMS category was affected by false claims from smaller local competitors that weakened consumer trust. Reckitt said it responded with content emphasizing that its VMS brands are manufactured in the U.S., and management said the effort has begun to improve growth trends.
Dettol continued to grow in China behind innovation, including its Activ Botany range, while Durex returned to growth through improved execution in social e-commerce channels. Eisenhardt said China VMS was roughly flat in the third quarter after growing at strong double-digit rates in the first half, and the business is expected to remain a headwind in the fourth quarter.
Europe returns to growth; seasonal outlook improves
Europe returned to growth, with like-for-like revenue rising 0.8%. Volumes declined as seasonal over-the-counter sales were affected by low cold and flu incidence, but pricing and mix more than offset the decline.
Gaviscon grew by double digits, supported by the rollout of Double Action, while Durex increased by the mid-single digits and Finish returned to growth. Reckitt said it had increased promotional investment in Europe’s highly competitive automatic dishwashing market while improving the return on its trade spending.
Management said the company is beginning the fourth-quarter cold and flu season from a stronger position. Incidence levels are running ahead of the prior year in several markets, including North America, while U.S. category sell-out has increased by double digits year over year for five consecutive weeks.
Reckitt has launched Mucinex 12HR Cold & Fever, secured additional shelf space for its seasonal OTC portfolio and reported early positive consumer feedback. Licht said it was still early in the season but that the company was encouraged by initial demand trends.
Category performance and financial outlook
- Self Care: Revenue rose 2.2%, or 4.2% excluding seasonal OTC, led by double-digit Gaviscon growth.
- Germ Protection: Revenue grew 6%, supported by Dettol momentum in emerging markets and double-digit Harpic growth.
- Household Care: Revenue declined 1.5%, but increased 1% excluding Russia Hygiene as Finish returned to growth in Europe and Vanish improved.
- Intimate Wellness: Revenue rose 6.4%, with Durex growth across all regions and double-digit Veet growth.
- Mead Johnson Nutrition: Revenue grew 2.7%, reflecting normalized trading conditions following disruption from the 2024 Mount Vernon tornado. International growth was led by Latin America.
Reckitt maintained its expectation for full-year adjusted operating margin for core Reckitt and Mead Johnson Nutrition of 24.9% to 25.6%. It also reaffirmed its expectation for high-single-digit full-year growth in emerging markets.
The company said its £500 million share buyback, launched Aug. 5, had repurchased £90 million of shares as of Oct. 23. Reckitt now expects 2026 adjusted net finance expense of £250 million to £270 million, aided by a one-off benefit from a Mead Johnson bond tender.
About Reckitt Benckiser Group (LON:RKT)
At Reckitt, we protect, heal and nurture. We are the company behind some of the world’s best known and most trusted Health and Hygiene consumer brands.
Delivering for a cleaner, healthier world requires strong brands with a global footprint. From Dettol, Lysol, Durex, Finish, Harpic and Vanish, Mucinex, Nurofen, Gaviscon, Veet and Strepsils, consumers love and rely on our brands to care for their families, as they have done for over 200 years.
We use our scientific expertise and deep human understanding to develop solutions to help people improve their lives – that is why over 30 million Reckitt products are sold each day worldwide.
At Reckitt, we’re all making a real difference to people all over the world, every day.
