Home Money MARKET REPORT: Haleon shares soar as the Sensodyne toothpaste maker unveils plans for a £500m buyback

MARKET REPORT: Haleon shares soar as the Sensodyne toothpaste maker unveils plans for a £500m buyback

by Elijah
0 comment
Stocks rise: Haleon's bumper buyback program came as sales of its Otrivin nasal drops and cough mixes flew off the shelves amid a strong cold and flu season.

<!–

<!–

<!– <!–

<!–

<!–

<!–

Haleon shares rose after toothpaste maker Sensodyne revealed plans to return £500m to investors this year.

The FTSE 100 company’s bumper share buyback program came as sales of its Otrivine nasal drops and cough mixes disappeared from shelves amid a strong cold and flu season.

Following a 6 per cent rise in the final three months of last year, revenue rose 8 per cent to £11.3 billion in 2023, while profits rose slightly to £1.63 billion .

Haleon recorded strong sales in Central and Eastern Europe and Otrivine performed well in the Middle East and Africa. The group’s revenue is expected to grow between 4 percent and 6 percent this year.

Debt has fallen by more than £2bn since it was spun off from GSK and Pfizer’s merged consumer healthcare business 18 months ago.

Stocks rise: Haleon's bumper buyback program came as sales of its Otrivin nasal drops and cough mixes flew off the shelves amid a strong cold and flu season.

Stocks rise: Haleon’s bumper buyback program came as sales of its Otrivin nasal drops and cough mixes flew off the shelves amid a strong cold and flu season.

To cut costs, it divested an antifungal drug brand last year and sold its Chapstick lip balm brand for £340m in January.

It said: “Selling them allows us to accelerate growth.” Derren Nathan, of Hargreaves Lansdown, said a “defensive portfolio” of painkillers and toothpaste is “less susceptible to swings in the economy than more discretionary categories”.

Haleon, which is also behind painkillers Advil, was trading at 330p in July 2022. Yesterday, it was up 5.6 per cent, or 17.5p, at 331.45p.

Before listing, it was a joint venture 68 percent owned by GSK and the rest controlled by pharmaceutical giant Pfizer.

Now, the pair own 4.2 percent and 32 percent respectively.

GSK shared some good news after avoiding another day in court by reaching a confidential settlement for a case alleging that its discontinued heartburn drug, Zantac, caused cancer.

The drug major said the settlement reflects its “desire to avoid the distraction associated with protracted litigation,” adding that it “does not admit any liability in this settlement.” The shares fell 0.3 per cent, or 5.2 pence, to 1,664.6 pence.

Stock Watch – ADF

ADF, which rents costume and makeup trailers to the UK film and television industry, is feeling the impact of strikes between May and November by American writers and actors.

ADF, which supported the making of the final season of Netflix hit The Crown, said producers are rushing to rearrange their schedules at short notice.

Revenue is expected to rise 11 per cent to £34.8m in 2023, while profits should fall almost 80 per cent to £1.1m. The shares fell 8.5 per cent, or 4.5p, to 48.5p.

In the broader market, the FTSE 100 rose 0.07 per cent, or 5.04 points, to 7,630.02 and the FTSE 250 rose 0.22 per cent, or 41.29 points, to close at 19,054. 87.

Hopes for interest rate cuts remained after US inflation rose 0.3 percent in January.

And bitcoin, which is the world’s largest cryptocurrency, continued to approach the record high of $69,000 (£54,600) it reached in November 2021.

Energean rose 4.1 per cent, or 40.5p, to 1,020p after the energy company started production at its fourth well in Israel and signed a 15-year gas contract that will add around £1.6 billion pounds in revenue.

There were also big gains for energy services provider Hunting after it returned to a £4m profit in 2023, having made a £1.9m loss the previous year.

Revenue soared 28 per cent to £736 million, boosting the shares 11.5 per cent, or 34.5 pence, to 334.5 pence.

Another riser was Howden Joinery after the kitchen supplier’s sales last year were roughly in line with a 2022 record.

Its shares gained 7 per cent, or 54.4 pence, to 827 pence.

Hammerson, owner of the Birmingham Bullring and Brent Cross shopping centres, posted strong results for 2023 as shoppers flocked back to stores. The shares rose 2.5 per cent, or 0.62p, to 25.4p.

Demand for immigration services such as removal center management and accommodation management in the UK and Europe saw Serco rise 4.5 per cent, or 8.1p, to 187.3p.

The outsourcing giant also outlined its plans to launch a £140m share buyback.

By contrast, the London Stock Exchange Group sank 0.4 per cent, or 36 pence, to 8,876 pence, after profits fell 3.7 per cent to £1.2 billion on last year.

You may also like