RB..L Regulatory News (RB.)

INTERIM MANAGEMENT STATEMENT Q3 2013 22 October 2013 STRONG Q3 Results at a glance Q3 % change % change YTD % change % change £m actual constant £m actual constant exchange exchange exchange exchange Net revenue 2,548 +5 +5 7,542 +6 +6- Like-for-like growth* (ex RBP) +5 +5 - Like-for-like growth* (total) +3 +4 Net Revenue by Segment-ENA 1,308 +9 +5 3,759 +7 +4-LAPAC 623 +7 +15 1,903 +10 +13 -RUMEA 352 +2 +5 1,055 +4 +5-Food 74 +3 +1 234 +3 +0 Total ex RBP 2,357 +7 +7 6,951 +7 +7-RB Pharmaceuticals 191 -14 -16 591 -3 -5 Total Net Revenue 2,548 +5 +5 7,542 +6 +6 Net Revenue by Category -Health 707 +27 +25 1,904 +30 +28-Hygiene 948 +5 +6 2,941 +6 +6-Home 500 -1 -1 1,479 +1 +1 -Portfolio brands 128 -19 -22 393 -28 -30 * Like-for-like ("LFL") growth excludes the impact of changes in exchangerates, acquisitions and disposals. Highlights: * Year to date like-for-like (LFL) net revenue growth (ex RBP) of +5%, driven by Emerging Markets Areas (EM) growth and continued growth in ENA. * Strong Q3 LFL growth of +5% (ex RBP) - ENA +2% LAPAC +10% and RUMEA +5%. * Continued excellent Health & Hygiene performances, and a solid Home performance in challenging market conditions. * RBP - volume (mg) market share of Film maintained at around 68% since launch of generic tablets and strategic review of RBP to commence. Commenting on these results, Rakesh Kapoor, Chief Executive Officer, said: "Reckitt Benckiser's focus on Health and Hygiene and emerging markets, alongwith our move to drive growth in ENA through increased investment behindinnovations and a streamlined organization structure is delivering goodresults. Regarding RBP, we are commencing a strategic review of the business and willconsider all options for maximising value for our shareholders. We expect thereview to take some time and will update shareholders during the course of2014. Looking ahead, we all know that market conditions remain challenging, but I amconfident that our strategy for growth and outperformance underpinned by ourcommitment to invest for the long term is the right thing to do. Our recentacquisitions are performing strongly, ahead of in-going assumptions andconsequently, we now believe that our full year net revenue growth (ex RBP)including the net impact of M&A will be at least 6%. We continue to expectto maintain full year margins (ex RBP)." Q3 YTD LFL Net M&A* FX Reported LFL Net M&A* FX Reported ENA** +2% +3% +4% +9% +3% +1% +3% +7% LAPAC +10% +5% -8% +7% +11% +3% -4% +10% RUMEA** +5% - -3% +2% +6% -1% -1% +4% Food +1% - +2% +3% - - +2% +3% Group ex RBP +5% +2% - +7% +5% +1% +1% +7% * Reflects the acquisitions of Schiff and other acquisitions, withdrawal fromPropack (Private Label) and disposal / discontinuance of a number of minorbusinesses. ** Scholl footwear business, previously reported as part of RUMEA, is nowreported as part of ENA. Net revenue values and growth rates have beenrestated / calculated based on this reclassification. Note: due to rounding, this table will not always cast. ENA 56% of core net revenue YTD 2013 total net revenue increased to £3,759m, with LFL growth of +3% (Q3 LFLgrowth of +2%). Market conditions remain challenging, especially in SouthernEurope. However, the combination of innovation led growth, greater speed ofexecution enabled by the ENA organization structure, and increased investmentbehind our brands, have delivered revenue outperformance relative to marketgrowth. With the exception of Southern Europe, all European regions are now in growth,driven by strong performances from our Health powerbrands. Scholl inparticular delivered an excellent performance behind the launch of our newScholl Pedi product launched during the year in a number of markets acrossEurope. In the US, growth was led by Mucinex which again outperformed, with continuedproduct innovation, and Lysol, driven by innovation and our new "Healthing"campaign. This was offset by a disappointing performance in Airwick in Q3, due tochallenging market conditions and a highly intensive competitive environment,particularly in the US. LAPAC 28% of core net revenue YTD 2013 total net revenue increased to £1,903m, with LFL growth of +11% (Q3LFL growth of +10%). Growth was driven by strong performances in most marketswithin LATAM and South East Asia, and China, behind distribution expansion,innovation and BEI. On a category basis growth was broad based across each ofour Health, Hygiene and Home categories, against a slowing market backdrop,with strong performances from Durex and Gaviscon, Dettol and Harpic, Wooliteand Vanish. Our recent acquisitions are integrating well and have shown encouraging earlyresults. RUMEA 16% of core net revenue YTD 2013 total net revenue increased to £1,055m with LFL growth of +6% (Q3 LFLgrowth of +5%). As signaled with our half year numbers, RUMEA growth has beenimpacted by operational and socio-political challenges in certain markets aswell as upscheduling of certain Nurofen products in Russia. In Q3 slowing market growth offset some strong performances from Nurofen,Strepsils, Veet, Finish and Dettol. Food YTD 2013 total net revenue was £234m (Q3 LFL growth of +1%), behind a weakmarket backdrop. The macro conditions in the food category remain challenging,against which our brands have proven resilient. Pharmaceuticals (RBP) YTD 2013 total net revenue was £591m a decrease of -5% at constant rates (Q3LFL growth of -16%) as indicated. The underlying volume growth in prescriptionsin the US continues to be strong with low double digit growth in line withrecent market trends. We are pleased that volume Film share of total buprenorphine prescriptions inthe US has maintained at around 68% since the launch of generic tablets.Despite the clinical and patient benefits of the film, we continue to expecterosion of Film share to increased pressure from price sensitive patients andpayors. As we have said before, sometime following the launch of generic tablets wouldbe the right time to consider all options for this business. Accordingly weare commencing a strategic review of RBP. The number one priority is to maximise value for our shareholders. We will beconsidering all options, while ensuring continued focus on delivering againstour current business objectives. We expect to update shareholders during thecourse of 2014. Category Review Q3 YTD LFL Net M&A* FX Reported LFL Net M&A* FX Reported Health +8% +17% +2% +27% +12% +16% +2% +30% Hygiene +7% -1% -1% +5% +7% -1% - +6% Home 0% -1% - -1% +1% - - +1% Portfolio -5% -17% +3% -19% -11% -19% +2% -28% * Reflects the acquisitions of Schiff and other acquisitions, withdrawal fromPropack (Private Label) and disposal / discontinuance of a number of minorbusinesses. Note: due to rounding, this table will not always cast. Health. YTD net revenue increased to £1,904m, with LFL growth of +12% (Q3 LFLgrowth of +8%). After an excellent start to the year driven by innovations andassisted by a strong and long 'flu season, the Health category delivered yetanother quarter of very strong growth. Mucinex continued to perform very well,particularly due to its further expansion beyond cough and congestion intosinus and cold & 'flu. We also launched Fast Max Night Time Cold & Flu whichhas been well received by the trade. Regarding Durex, our recently launched innovations such as Real Feel and DurexEmbrace pleasure gels are helping the brand transform as a sexual wellbeingbrand. Durex is also serving an important role as a source of "next practice"in digital communications and new marketing. Our other Health care brands arealso performing well, and Scholl in particular exhibited strong growth in Q3behind our new Express Pedi and Hard Skin and Callus Express Liquids in anumber of markets throughout Europe. Our recent consumer health acquisitions are performing strongly, ahead ofin-going expectations and additional synergies are being invested back into thebrands to fuel growth. In the US, MegaRed and Airborne in particular haveperformed well as we make further progress in the integration of the business.In China our Myanshuning sore throat brand has made a strong start, and we areseeing early encouraging results from our collaboration agreement with BMS inLATAM. Hygiene. YTD net revenue increased to £2,941m, with LFL growth of +7% (Q3 LFLgrowth of +7%) largely driven by strong growth in the Dettol / Lysol franchisein all our three areas. Our "Healthing" campaign combined with the continuedexpansion and success of the Power & Free portfolio across North America andEurope continued to drive growth. We expanded the "Healthing" theme in Q3 witha successful "back to school" campaign where we visited schools across the USteaching young children healthy habits. In Emerging Market areas we continueto focus on core disinfection, underpinned by brand equity driven initiativessuch as our new mums hospital visit programme in over 40 countries. Oursuccessful category extension of Dettol Kitchen Gel, has driven strong growthin India in Q3. Harpic continued its strong momentum behind penetration increase projects andthe launch of our All-in-one line extension in India. Growth in Finishaccelerated in Q3 driven by new Quantum Power Gel tabs and our Quantumchallenge campaign. We also continue to progress our Dishwashing machinepenetration programs run in cooperation with leading white good manufacturers,with good results in a number of countries, including Brazil, Russia, UK, andSouth Africa. Mortein has experienced strong growth throughout the year, led by LAPAC, anddriven by innovation and strong in-market support. In Q3 we launched our newadvanced liquid electrical "Peaceful Nights" system in Brazil and an extensionof our Outdoor range in Australia. Home. YTD net revenue increased to £1,479m, with LFL growth of +1% (Q3 LFL growthof 0%). Airwick, after a strong start to the year, was impacted by acombination of increased competitive intensity and the lapping of thesuccessful launch of our Black Edition candles in the second half of lastyear. On Vanish we have seen continued strong growth in LATAM behind penetrationprogrammes. Although market conditions continue to be weak across Europe, ournew "Vanish tip exchange" campaign is resulting in improved growth and share ina number of markets. Portfolio Brands. YTD net revenue decreased to £393m, with an LFL decline of-11% (Q3 LFL decline of -5%). This continued to be due in large part to actionstaken in the European Footwear business undertaken in Q1 and continued weaknessin Laundry Detergents and Fabric Softeners in Southern Europe, driven primarilyby competitive market conditions. Financial Position There has been no material change to the financial position of the companysince the published 2012 Annual Report and Accounts. 2013 Targets Our recent acquisitions are performing strongly, ahead of our in-goingassumptions and consequently, we now believe that our full year net revenuegrowth (ex RBP) including the net impact of M&A will be at least 6%(1). Wecontinue to expect to maintain full year margins(2). 1 at constant rates including acquisitions and disposals / withdrawal fromPrivate Label, excluding RBP. 2 ex RBP, adjusted to exclude the impact of exceptional items. For further information, please contact: Reckitt Benckiser +44 (0)1753 217800 Richard JoyceDirector, Investor Relations Andraea Dawson-Shepherd +44 (0)1753 446447SVP, Global Corporate Communication & Affairs Brunswick (Financial PR) +44 (0)20 7404 5959David Litterick Cautionary note concerning forward-looking statementsThis document contains statements with respect to the financial condition,results of operations and business of Reckitt Benckiser and certain of theplans and objectives of the Group with respect to these items. Theseforward-looking statements are made pursuant to the "Safe Harbor" provisions ofthe United States Private Securities Litigation Reform Act of 1995. Inparticular, all statements that express forecasts, expectations and projectionswith respect to future matters, including trends in results of operations,margins, growth rates, overall market trends, the impact of interest orexchange rates, the availability of financing to the Company, anticipated costsavings or synergies and the completion of strategic transactions areforward-looking statements. By their nature, forward-looking statementsinvolve risk and uncertainty because they relate to events and depend oncircumstances that will occur in the future. There are a number of factorsdiscussed in this report, that could cause actual results and developments todiffer materially from those expressed or implied by these forward-lookingstatements, including many factors outside Reckitt Benckiser's control. Theprincipal risks and uncertainties which could have a material effect on theGroup's performance are described on pages 13 and 14 of the Annual Report andFinancial Statements for the year ended 31 December 2012. Past performancecannot be relied upon as a guide to future performance. Basis of Presentation and Exceptional ItemsWhere appropriate, the term "like-for-like" (LFL) describes the performance ofthe business on a comparable basis, excluding the impact of acquisitions,disposals, discontinued operations and foreign exchange. Where appropriate, the term "core business" represents the ENA (Europe andNorth America), RUMEA (Russia / CIS, Africa, North Africa, Middle East andTurkey) and LAPAC (Latin America, North Asia, South Asia and ANZ) geographicareas, and excludes RBP and RB Food.