By Scott Kanowsky
Investing.com -- Shares in Reckitt Benckiser Group PLC (LON:RKT) fell on Wednesday after the consumer goods maker reported a larger than expected drop in sales volumes in the third quarter.
The multinational firm behind brands like Air Wick air fresheners and Calgon water softener posted a 4.3% decline in volumes during the three-month period, largely due to a slide in demand for its Lysol disinfectant products. Analysts had expected the figure to dip by 2.8%.
A similar decrease was recently seen by Reckitt's peers Procter&Gamble (NYSE:PG) and Nestle (OTC:NSRGY), potentially suggesting that a spike in inflation is leading many consumers to rein in expenditures.
"We expect investors to focus on any further signs of weakening in discretionary spend across the portfolio," analysts at Morgan Stanley said in a note to clients.
Despite these worries, Reckitt still saw like-for-like net revenues expand by 7.4% to £3.7B, above consensus expectations for growth of 6.1%. Reckitt attributed the increase to a 12% improvement in price/mix, which helps gauge the impact of price rises across its various products.
Meanwhile, the company also narrowed its guidance range for annual like-for-like net revenue to 6% - 8%, down from its previous band of 5% to 8%. It is targeting full-year growth in adjusted operating margins as well.