Haleon plc (NYSE / LON:HLN), a global leader in consumer health, today announced its financial results for the first quarter ended March 31, 2024, showcasing solid performance underpinned by strategic execution despite several market challenges.
The company reported organic revenue growth of 3.0% this quarter, attributed largely to a 5.2% increase in its Power Brands, which include well-known products like Sensodyne and Centrum. This growth was achieved despite a 2.2% decline in reported revenue to £2,919 million, largely due to unfavorable foreign exchange impacts and adjustments from mergers and acquisitions.
Strong Performance Across Key Sectors
Haleon’s Oral Health and Vitamins, Minerals, and Supplements (VMS) sectors exhibited robust performance, with organic revenue growth rates of 10.6% and 9.9% respectively. The company credits this success to significant innovation and effective in-market execution. Notably, Sensodyne continued to perform exceptionally well in the Middle East, Africa, China, and India.
However, the Pain Relief and Respiratory Health categories faced more challenging comparatives from the previous year, leading to declines in organic revenue by 4.8% and 2.7% respectively. These sectors had benefitted significantly during the same period in 2023 due to heightened demand driven by the easing of COVID-19 restrictions and a severe cold and flu season.
Financial Highlights
Haleon demonstrated strong organic profit growth of 12.8%, significantly outpacing revenue growth. This was largely driven by effective operating leverage resulting from gross margin expansion and cost efficiencies, despite the backdrop of global economic pressures. The reported operating profit grew by 4.5% to £655 million, with the adjusted operating profit margin increasing by 220 basis points organically to 24.2%.
Strategic Developments and Outlook
Amidst its financial achievements, Haleon also made strategic moves, including the repurchase of approximately £315 million worth of its shares as part of an ongoing buyback program aligned with Pfizer’s global offering. This reflects the company’s continued focus on capital allocation and shareholder returns. Moreover, Haleon reiterated its full-year guidance for 2024, expecting organic revenue growth of 4-6% and operating profit growth to outpace revenue growth.
Brian McNamara, CEO of Haleon, expressed confidence in the company’s trajectory, stating, “Our first-quarter results demonstrate the inherent strength of our diversified portfolio and the effectiveness of our strategic initiatives. Despite some expected challenges, such as retailer adjustments in the US and tough year-over-year comparatives, our core categories continued to perform well, and we remain on track to meet our annual targets.”
Haleon’s focus remains on enhancing its competitive edge through continued innovation, strategic market execution, and maintaining a robust product pipeline to navigate a potentially turbulent market environment effectively.
About Haleon plc: Haleon (LON/NYSE: HLN) is a leading global consumer health company. With a commitment to improving everyday health with humanity, Haleon’s product range covers major health categories such as Oral Health, Pain Relief, Respiratory Health, Digestive Health, and VMS. The company’s trusted brands, including Advil, Sensodyne, and Centrum, are backed by science and trusted by consumers worldwide.
