Reckitt Posts Strong Growth on Back of Adspend Increase

29 October 2008

SLOUGH, UK: Anglo-Dutch household goods giant Reckitt Benckiser posted organic sales growth of 10% in the third quarter of this year, having increased its advertising spend by 15% (at constant prices) over the last four months.

The company's global sales were up 24% year-on-year, to a total of around $2.8bn (€2.2bn; £1.8bn); total income was also up 31% to $480 million.

In North America and Australia, Reckitt's organic sales grew by 6%, rising to 23% if taken to include the results of drug maker Adams Respiratory, which it recently purchased.

Sales in Western Europe, however, were essentially flat, according to chairman/ceo Bart Becht.

Says he: "There is no growth in Western Europe. The strength of the growth on a global basis is coming out of Eastern Europe and the developing markets."

Reckitt's advertising spend equated to some 12.5% of the company's total sales (up from 12.2% in 2007), and is valued at around $350m worldwide.

Becht also said that overall growth in Reckitt's main categories was down by 1%, but that his company had posted volume growth of around 6% and price-driven growth of 4%, and remained resistant to encroachment by private label brands.

He adds: “There are some markets where private label has gained in importance. We are not losing share to private label."

Reckitt has now raised its full-year growth forecast to 13% on the back of its strong Q3 performance, from the previous estimate of between 11% and 12%.

Data sourced from; additional content by WARC staff