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Reckitt Benckiser Group Plc Rallies As Earnings Advance Just 2%

The shares of Reckitt Benckiser (LSE: RB) reached as high as 4,895p during early-morning trading after the consumer-goods firm today announced the release of its fourth quarter and full-year results.

The FTSE 100 member, which manufacturers and markets Dettol antiseptic and Nurofen pain-relief medication, among other household names, confirmed that net revenue for 2013 had climbed £500m, or 5%, to £10bn.

The full-year results reported adjusted operating profits had risen by £46m to £2.6bn, a 2% increase on the previous year’s figure.

The results also unveiled like-for-like sales growth was 5% but had slowed to 4% during the fourth quarter, down from 7% seen during the fourth quarter of 2012.

Reckitt announced debt had reduced by £0.3bn to £2.1bn alongside a £100m investment push that is “focused on Powerbrands, Powermarkets and new initiatives, as well as… newly acquired brands.

Adjusted earnings for 2013 advanced 2% to 270p per share while the full-year dividend was lifted 3p to 137p per share.

Rakesh Kapoor, Reckitt’s chief executive, declared:

“Our strategy for growth and outperformance through driving Health and Hygiene Powerbrands together with our focus on 16 Powermarkets is delivering results.  We are pleased with the continued strength of our ENA – Europe and North America performance. And while emerging markets continue to slow, we delivered very strong results in India and China.”

Mr Kapoor emphasised that Reckitt would “deliver another year of high quality growth”, despite challenging market conditions during the beginning of the year.

Of course, whether today’s annual figures as well as the wider prospects for the household-goods sector both combine to make Reckitt  a ‘buy’ right now is something only you can decide.

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> Douglas does not own any share mentioned in this article.