Reckitt (RKT.L): Post the call: Acceleration in Q426E LFL, with early cautioning on 27E input and interest cost

Reckitt management hosted their conference call post Q326 results, acknowledging frustration with the Lysol capacity constraints that weighed on NA performance in the quarter, both weighing on sell-in (including some penalties in the pricing) and sell-out (cancelled promotions). Lysol sell-out is reaccelerating back to +MSD% so far in Q4 with management confident on meeting supply. The other call out on the lowered topline guidance was China VMS, which, though management sees it as temporary, will remain in the coming quarter. Overall for Q4, management flagged an NA rebound, continued Europe momentum, and a better flu season where they see in the US early incidence levels trending higher y/y and category sell-out has been +DD% for the past five weeks. Pricing is beginning to pick up, having been implemented selectively in Europe in Q3, though Reckitt made continued price investments in the US given consumer value-seeking behaviour. The CEO acknowledged that current levels of commodity