April 24, 2024 08:32 GMT
Reckitt (RKTLN; A3 Pos, A- S) {RKT LN Equity} Earnings Call
CONSUMER STAPLES
Mgmt continued the normal line, seeing no legal risk and struggled to give any detailed colour on timings...which makes us worried for another March like surprise. Continuing to not provision for any losses will mean unch capital allocation - new buyback will be announced in July - we are not too concerned with BS squared away.
As we've noted this is not a Bayer like situation - product is a staple in hospitals/still used & medical practitioners have come out to support it...but this was all known in the first case loss. Bulk federal cases still coming up & no appeal result leaves uncertainty - curve not wide enough on that for us to have a screen cheap view.
- Litigation will include post-trial motions on Watson case (the first $60m loss that triggered a sell-off) and a new trial set to begin in September. Refuses to comment on expected timing of the appeal.
- Has not changed near-term outlook of results on above & gave the standard "Enfamil is safe...strongly rejects any assertion that products cause NEC...any failure of warning...no causal scientific connection...no plans to stop providing product"
Cash lines unch today. Equity analyst takes; {NSN SCFPPDT0G1KW <GO>}
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