Announcements

RB Press release - 24/10/2007
Further Strong Growth in Q3. Full Year Net Revenue & Profit Targets Raised

Results at a Glance	Q3 £m	% change actual exchange	% change constant exchange	Year To Date  £m	% change actual exchange	% change constant exchange
Net Revenues	1,337	+8	+9	3,897	+7	+11
Operating Profit reported	338	+51	+55	848	+43	+49
Net Income reported	254	+62	+65	649	+55	+62
EPS (diluted) reported	34.7p	+62		88.3p	+55
Operating Profit adjusted *	291	+7	+9	801	+15	+19
Net Income adjusted *	218	+14	+15	613	+24	+28
EPS (diluted) adjusted *	29.8p	+14		83.4p	+24

• Reported results include exceptional items consisting of restructuring charges relating to the integration of Boots Healthcare International (BHI) and further restructuring of manufacturing, and the gain on disposal of Hermal.  Q3 2007 includes a gain of £47m pretax compared to a pretax charge of £47m in Q3 2006, and of £104m in the year to date 2006.  Adjusted results, discussed below, exclude both of these items.
• Q3 net revenues rose 8% (9% at constant exchange).  Adjusted operating profit rose to £291m, +7% (+9% constant).  Gross margin increased 140bps to 57.9% and adjusted operating margin was flat at 21.8%.  Adjusted net income rose 14%.
• Year to Date (YTD) net revenue growth was 7% at actual exchange (+11% constant).  Adjusted operating profit increased to £801m, +15%.  Gross margin expansion was 180bps to 57.7%, while adjusted operating margin increased 140bps to 20.6%.  Adjusted net income was £613m, +24%.
• On a reported basis, operating profits rose 51% to £338m in Q3, and by 43% to £848m YTD.  Net income rose 62% to £254m in Q3 and by 55% to £649m YTD.
• Net borrowings were £297m, after further strong cash inflow and £255m proceeds of the Hermal disposal, and after a further £90m of share buybacks and payment of the interim dividend (£179m) in the quarter.

Commenting on these results, Bart Becht, Chief Executive Officer, said: -

"Reckitt Benckiser had a strong Q3 bringing year to date net revenue growth to 11% at constant exchange.  Growth was broad based, driven by new products like Air Wick Freshmatic and Vanish Crystal White, and strong growth in the Health & Personal Care franchises, Dettol, Nurofen and Strepsils.  Profit growth continues to run ahead of the full year target due to good gross margin expansion and BHI synergies coming in ahead of schedule. 

“We are therefore raising our full year target for net revenue growth (2006 base £4,922m) to around 9% at constant exchange (previously 7% - 8%) or up to 6% at actual exchange.  For net income growth (base £786m) we are raising our target to 15% growth at actual exchange (equivalent to high teens at constant exchange versus previous target of mid teens).  The increased target excludes exceptional pretax profits of £47m in Q3 2007. "

To view the full press release, please click on the PDF icon at the bottom of the announcement.