Haleon shrugged off the cost-of-living crisis yesterday as the painkiller retailer reaped the rewards of a flu outbreak at the start of the summer.
It said annual sales would now be better than previously hoped, thanks to shoppers swallowing price hikes of 7.5 percent and sticking with the maker of Sensodyne and Panadol.
Sales were aided by the easing of Covid restrictions in China, boosting demand for its drugs, while a flu outbreak this spring sent consumers scrambling to stock up on medicines.
As a result, the FTSE 100 company, which was spun off from pharma giant GSK last July, said its sales rose 10.4 per cent to £5.7 billion in the first half of 2023.
Haleon, which celebrated its first anniversary on the London Stock Exchange last month, also posted an 8.9 percent profit increase to £1.3 billion compared to the first half of 2022.
Healthy sales: Painkiller maker Haleon got a boost after a flu outbreak this spring saw consumers rush to stock up on drugs
“A year after IPO, we are very pleased with Haleon’s first half results,” said CEO Brian McNamara.
But shares in Haleon were dented 2.53 percent or 8.35 pence yesterday, trading at 321.7 pence.
Investors were discouraged after the company said its operating margin had shrunk in the first half due to painful inflationary pressures.
McNamara warned “we continue to expect a challenging environment given further pressure on consumer spending and global geopolitical and macroeconomic uncertainties.”
The FTSE 100 collapsed at the open of the markets yesterday after the market was shaken by a downgrade in the credit rating of the top US agency Fitch. The London blue chip index fell 1.36 percent, or 104.64 points, to 7561.63.
But Smurfit shares were a rare bright spot, despite the packaging giant posting shrinking sales.
Demand for cardboard boxes had slumped after the peaks of a pandemic boom and hesitation amid the global economic downturn, sending sales down 9 percent.
But CEO Tony Smurfit reassured investors by saying that when demand returns, the company would consider raising box prices.
The company was founded in 1934 as a box maker in Dublin and was taken over four years later by Mr Jefferson Smurfit, trading as Jefferson Smurfit thereafter. It was listed on the Irish Stock Exchange in 1964.
Jefferson Smurfit grew under the leadership of the founder’s son, Sir Michael Smurfit, who became CEO in 1974. His son Tony is the current CEO. Shares rose 1.83 percent, or 56 pence, to 3116 pence yesterday.
Elsewhere, Ferrexpo shares fell 6.26 percent, or 5.8 pence, to 86.9 pence after the mining company posted falling half-year profits.
It said operations in Ukraine continue to be impacted by the ongoing war, with revenues down 64 per cent to £262 million.
Convatec, which sells medical dressings and catheters, posted strong profits for the first six months of the year, pushing its stock up 6.32 percent, or 13 pence, to 218.8 pence.
The Reading-based company also raised its full-year forecast.
Investors welcomed the news that oil engineering company John Wood and Shell have signed a three-year contract. It means the former will support Shell’s greenfield and brownfield projects. Shares in John Wood rose 1.39 percent, or 2.1 pence, to 153.3 pence.
Shares of Halfords plunged after warnings that earnings per share have slipped 11 percent a year over the past five years.
Analysts warned that this could indicate the company is struggling, limiting its ability to pay a higher annual dividend in the future.
But in the short term there was good news for investors as it said it would pay its dividend of £0.07 on September 15, a higher payout than last year.
Shares fell 5.89 percent, or 12.8 pence, to 204.4 pence.
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