Reckitt reported better-than-expected like-for-like net sales growth for the fourth quarter ended December 31, citing particularly strong performance in emerging markets and reaffirming a medium-term growth target for its core businesses. The company said it expects its core operations to expand by 4% to 5% in 2026.
The maker of Durex condoms and Lysol cleaning products has been reshaping its portfolio alongside peers such as Nestle and Unilever, concentrating on higher-growth and higher-margin brands. As part of that strategy, Reckitt completed the divestment of its Essential Home division to private equity firm Advent International on December 31 for $4.8 billion, while retaining a 30% equity stake in the business.
For the quarter, group like-for-like net revenue rose 5.4%, ahead of a company-compiled consensus expectation of 4.7%.
Looking at full-year regional performance, emerging market revenue growth was a standout at 14.6%, while Europe recorded a decline of 1.4%. Emerging markets now represent roughly 42% of Reckitt's core net revenues and have delivered what Barclays analysts characterised as 10 consecutive quarters of double-digit sales growth.
Barclays analysts noted that emerging markets "is doing the heavy lifting for the group and provides a reliable growth engine at a time when developed markets category growth is sluggish."
Despite the stronger overall top-line, Reckitt signalled that headwinds persist in developed markets. The company said it expects the difficult trading backdrop in Europe to continue and warned that its seasonal over-the-counter (OTC) business could face a weaker first quarter of 2026 due to a milder cold and flu season.
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Reckitt's quarterly results underline the contrast between fast-growing emerging markets and softer demand in parts of the developed world. Management's guidance for 2026 points to modest core expansion, while the retained stake in Essential Home keeps some exposure to the divested business.