Kenvue tempers annual profit view on soft demand for cold, flu medicines

Bhanvi Satija
Updated 2-min read
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By Bhanvi Satija

(Reuters) -Kenvue said on Thursday that a delayed start of the flu season in the northern hemisphere would hurt sales of some of its over-the-counter medicines this year, as the Benadryl maker cut the higher end of its annual profit forecast range.

Shares of Kenvue were down nearly 4% in early trading after the consumer health company also flagged an increased impact from a stronger dollar to its full-year profit.

"Mostly due to the seasonally warm weather we saw in the northern hemisphere in September, we see a slow start of the season," CEO Thibaut Mongon told Reuters.

Kenvue's third-quarter revenue came in at $3.92 billion, slightly above analysts' estimates of $3.91 billion, as per LSEG data.

The former unit of Johnson & Johnson said its third-quarter revenue was aided by demand for its anti-allergy products like Zyrtec and Reactine tablets, smoking cessation or Nicorette products and digestive health products like Imodium and Pepcid.

However, sales were impacted by soft demand for its products in China.

"The Chinese consumer is more choiceful in where they spend their money," said Mongon in an interview.

Kenvue cut the higher end of its full-year adjusted profit to $1.28 per share from $1.31, and maintained the lower end at $1.26 per share.

The forecast change comes in contrast to peer Haleon, which raised its annual organic revenue growth outlook, betting on resilient demand for its household brands like Sensodyne toothpaste and Panadol tablets.

The U.S. health regulator is reviewing common decongestant, phenylephrine, after an advisory panel recently declared the ingredient ineffective. The decongestant is an ingredient in Kenvue's popular products Benadryl and Tylenol.

Kenvue has not seen any impact from the ongoing review, said finance chief Paul Ruh on a conference call.

Products containing phenylephrine represent about 2% of Kenvue's global revenue, he added.

(Reporting by Bhanvi Satija in Bengaluru; Editing by Shweta Agarwal)