Shares in Haleon slumped after soft demand for cough, cold and flu medicines forced the consumer healthcare giant to cut its revenue target.
The FTSE 100 firm lost more than 11 per cent in early trading, to 333p. Haleon had been expecting revenue growth of between three and five per cent but on Thursday trimmed this target to 2.5 per cent.
Lower demand for flu medicines slowed Haleon’s sales growth in North America from 3.1 to 2.5 per cent, though higher demand for toothpaste brand Sensodyne was a bright spot in this market.
Haleon, which split off from pharmaceuticals giant GSK in 2022, saw revenue dip by 0.6 per cent in Europe, owing to weak sales of Centrum, its multivitamin supplement brand, which it blamed on “weaker category trends”.
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SUBSCRIBE HEREThe group was forced to suspend shipments of Centrum into China after a change in raw material regulations affected imports of the over-the-counter vitamins. Despite this, sales in China grew by mid-single digits.
Haleon said it saw only low-single digit growth in south-east Asia and Taiwan, because of the “softer consumer backdrop” caused by the conflict in the Middle East.
Consumer health firms under pressure
Chief executive Brian McNamara said: “Our third quarter organic revenue growth of 2.6 per cent was below our expectations as we navigated softness across some of our categories including weaker cough, cold and flu consumption.
“We are clear on where we need to improve and we are taking action to deliver stronger performance despite challenging markets.”
“True, profit guidance has been maintained, but following Reckitt’s results a couple of days ago, consumer health companies have claimed a notably unenviable position amongst the stocks we cover,” he said.
Earlier this week Dettol and Durex owner Reckitt, Haleon’s FTSE 100 rival, lowered its profit guidance after production issues hit production of Lysol, its disinfectant brand, in the US.
Shares in Reckitt have lost more than 15 per cent in the year to date, though they gained more than one per cent in early trading on Thursday.