Haleon (HLN)

[simoan]

It seems the evidence is not cut and dried, and much of the research has not been peer reviewed,but of course, that won’t stop the ambulance chasing lawyers in the US. Sanofi has fallen most heavily, probably because they have been accused of deleting emails. I smell a buying opportunity based on what I’ve read to date.

Are you referring to Sanofi?

No, GSK. Haleon still has too much debt for my liking. Until the debt position becomes clearer I won't be adding to my very small Haleon holding. A takeover to remove it from my account would not be the worst result, but preferably not by Unilever. I can't see that happening now anyway.

All the best, Si

[simoan]

On the debt situation following my previous comment... I make it 6x Net Debt/EBITDA currently which is off the scale for me. I'm sure it won't be a problem given cash generation but worth re-iterating the ambition is for Net Debt/EBITDA below 3x by the end of 2024. Of course, this doesn't take into account any substantial fine resulting from losing the Zantac case, so I suspect the share price will be more sensitive to news from the case for that reason than GSK, for example.

[simoan]

Update: Just seen this on the newswire...

LONDON, Aug 11 - Haleon - GSK's recently spun off consumer health unit - is not a party to the U.S. litigation focused on the heartburn medicine Zantac, a spokesperson told Reuters on Thursday. "We have never marketed Zantac in any form in the U.S., as
Haleon or as GSK consumer healthcare," the spokesperson said in response to queries about sharp declines in Haleon shares.

Given over-the-counter Zantac has been sold by several companies over time, that "may make third parties liable ahead of any Haleon exposure," the spokesperson added.

[monabri]

Update: Just seen this on the newswire...

LONDON, Aug 11 - Haleon - GSK's recently spun off consumer health unit - is not a party to the U.S. litigation focused on the heartburn medicine Zantac, a spokesperson told Reuters on Thursday. "We have never marketed Zantac in any form in the U.S., as
Haleon or as GSK consumer healthcare," the spokesperson said in response to queries about sharp declines in Haleon shares.

Given over-the-counter Zantac has been sold by several companies over time, that "may make third parties liable ahead of any Haleon exposure," the spokesperson added.

Similar...

https://www.fiercepharma.com/manufactur ... etero-labs

May 2021

"GSK pulled its branded version of the drug—sold only outside the U.S.—as Sanofi recalled its U.S. brand and a host of other drugmakers pulled generic copies. The GSK product was made with active ingredients sourced from Indian drugmakers, local media reported at the time."


This article goes back to 2019

https://www.fiercepharma.com/manufactur ... c-products

[simoan]

Update: Just seen this on the newswire...

LONDON, Aug 11 - Haleon - GSK's recently spun off consumer health unit - is not a party to the U.S. litigation focused on the heartburn medicine Zantac, a spokesperson told Reuters on Thursday. "We have never marketed Zantac in any form in the U.S., as
Haleon or as GSK consumer healthcare," the spokesperson said in response to queries about sharp declines in Haleon shares.

Given over-the-counter Zantac has been sold by several companies over time, that "may make third parties liable ahead of any Haleon exposure," the spokesperson added.

Similar...

https://www.fiercepharma.com/manufactur ... etero-labs

May 2021

"GSK pulled its branded version of the drug—sold only outside the U.S.—as Sanofi recalled its U.S. brand and a host of other drugmakers pulled generic copies. The GSK product was made with active ingredients sourced from Indian drugmakers, local media reported at the time."


This article goes back to 2019

https://www.fiercepharma.com/manufactur ... c-products

It seems Sanofi had the US rights but GSK/Haleon originally developed the drug. Will be interesting to see what level of indemnification this provides for Haleon.

All the best, Si

[idpickering]

2022 Half year results.

Six months ended 30 June 2022

· H1 revenue +13.4% to £5,188m, organic revenue growth +11.6%; 3.7% price and 7.9% volume/mix

· Strong power brand performance in H1: +13.4% organic growth with Panadol, Theraflu, Otrivin, Advil and Centrum particularly strong

· 2/3 of our business gained or maintained share in the six months ended 30 June 20221

· E-commerce 9% total sales, growth in the high teens

· H1 Reported operating profit increased 22.1% to £900m, with margin 17.3% up 120bps

· H1 Adjusted operating profit increased 21.2% to £1,191m, up 15.5% at constant currency (CER)

· H1 Adjusted operating margin 23.0%, up 90bps (CER) and 150bps at reported rates

· H1 net cash from operating activities was £680m, which included £224m related to the net cash outflow from separation, restructuring and disposals; Free cash flow for H1 2022 was £553m with free cash flow conversion of 102%

· Net debt at 18 July 2022 was £10,707m; recently repaid £750m of £1.5bn term loan

· FY22 organic revenue growth and Adjusted operating margin guidance unchanged from HY Trading update on 27 July 2022

Brian McNamara, Chief Executive Officer, Haleon said:

"I am incredibly proud that in the first half Haleon successfully completed its separation from GSK and became an independent listed company. This was the result of a huge amount of hard work and preparation, and I would like to thank all of my colleagues for their tireless efforts, focus and commitment.

Haleon performed strongly in the first half of the year with double digit revenue growth, importantly with a healthy balance of price and volume/mix reflecting brand strength across our portfolio. Furthermore, we gained or maintained share in most of our business, demonstrating that continued investment is driving sustainable growth, even in difficult market conditions. I am also pleased that we delivered margin expansion in the first half despite significant cost inflation and absorption of standalone costs for the business. Strong free cash flow generation underpins confidence in our ability to de-lever quickly over the coming years.

Whilst navigating the current macro-economic challenges and uncertainties, positive momentum in our business has continued into the second half. This combined with the strength of the business reinforces our confidence that we are well positioned to deliver on guidance this year and over the medium term."

And later;

6 DIVIDENDS

During the periods ended 30 June 2022 and 2021, the Group declared and paid a series of dividends to GSK and Pfizer under the Company's Shareholders Agreement valid at that time. These dividends included the following:

· On 30 March 2022, £421 per share for a total amount of £421m.

· On 29 June 2022 £452 per share for a total amount of £452m.

· On 30 June 2021, £621 per share for a total amount of £621m.

No further dividends were declared or paid.

Prior to the demerger, the Group declared and paid dividends of £11,057m in July 2022. Further information about these dividends are provided in Note 15 'Post balance sheet events'.

https://otp.tools.investis.com/clients/ ... 9120775813

Ian.

[monabri]

Why are Haleon's products still being advertised on TV under the GSK banner?

[idpickering]

Q3 Trading Statement.

Another quarter of strong growth underpinned by positive volume/mix

· Q3 Reported revenue +16.1%; organic +8.1% with 5.5% price, 2.6% volume/mix

· 9m Reported revenue +14.4%; organic +10.3% with 4.0% price, 6.3% volume/mix

· E-commerce 9% of total revenue with continued growth in the high teens

· Healthy power brand Q3 organic revenue growth +7.4%; 9m +11.3%

https://www.investegate.co.uk/haleon-pl ... 00109097F/

Ian.

[seagles]

From their powerpoint presentation Initial dividend expected to be at the
lower end of the 30-50% pay out range3

Couldn't find what this range is though or when likely to be paid?

[daveh]

From their powerpoint presentation Initial dividend expected to be at the
lower end of the 30-50% pay out range3

Couldn't find what this range is though or when likely to be paid?

It says 30-50% of profits attributable to shareholders.

So that could be £725m adjusted profit or reported profit at £569m or probably £345m profit after tax attributable to shareholders which is given just before appendix 1 in the RNS.

They don't say when, just that will be the initial dividend. So maybe with the finals, pro rata for the time they have been an independent company or more likely for the next financial year.

[csearle]

Just in case your Memoire needs Aide.

I am very keen to find out dates of announcement, ex-div, and payment as all this mystery is mucking up the appearance of my spreadsheet, which is making me grumpy. C.

PS I've just emailed their investor relations and asked them.

[IanTHughes]

Just in case your Memoire needs Aide.

I am very keen to find out dates of announcement, ex-div, and payment as all this mystery is mucking up the appearance of my spreadsheet, which is making me grumpy. C.

I cannot give you Ex-Dividend or Dividend Payment dates, but the Announcement of the Results for 2022 will be on 02 March 2023.

https://www.haleon.com/investors/

Upcoming events
2nd March 2023 - FY 2022 results
May 2023 - Q1 2023 trading update
August 2023 - H1 2023 results

Enjoy!


Ian

[csearle]

cannot give you Ex-Dividend or Dividend Payment dates, but the Announcement of the Results for 2022 will be on 02 March 2023.

Thanks Ian, that is a great help. Mood improving. C.

[idpickering]

2022 Full year results.

Strong growth with a healthy balance of price and positive volume/mix

●

FY Revenue +13.8% to £10,858m, organic growth +9.0% with 4.3% price and 4.7% volume/mix

●

Positive Power Brand performance across the portfolio, +10.1% organic growth

●

2/3 of our business gained or maintained market share1 in the 12 months ended 31 December 2022



Pricing and efficiencies offsetting inflationary pressures

●

FY Reported operating profit increased 11.4% to £1,825m

●

FY Adjusted operating profit increased 13.8% to £2,472m, up 5.9% constant currency

●

FY Adjusted operating profit margin 22.8%, flat year on year


Continued high cash generation

●

FY net cash flow from operating activities was £2,063m, which included £435m related to the net cash outflow from separation, restructuring and disposals; FY 2022 Free cash flow of £1,579m

●

Net debt at 31 December 2022 was £9,868m, with 3.6x net debt/adjusted EBITDA

●

Inaugural final dividend proposed of 2.4p per share in respect of trading since demerger on 18 July 2022


Positive outlook for 20232, settlement on majority of PPI cases

●

FY2023 organic revenue growth expected to be 4-6%

●

FY2023 adjusted operating profit margin broadly flat after adverse transactional FX of c. 40bps

●

Settlement reached to resolve the vast majority of PPI cases (Nexium24HR and Prevacid24HR)

●

Positioned well to deliver on medium term guidance

Brian McNamara, Chief Executive Officer, Haleon said:

"2022 was an extraordinary year for Haleon, having successfully demerged from GSK to become the first listed company 100% focused on consumer health. All the result of significant work and commitment from our colleagues around the world, and I would like to thank them for their tireless efforts and achievements.

In our first FY results, we delivered a strong performance whilst navigating a highly volatile environment. Our organic revenue growth of 9.0% was well balanced between volume and price, with two thirds of the business gaining or holding share. This performance reflected the quality of our portfolio of category leading brands, successful innovation, and excellent execution in market.

Our agility across the business resulted in adjusted operating profit growth of 5.9% constant currency despite significant inflation, standalone costs and adverse transactional FX. Strong free cash flow generation of £1.6bn enabled us to de-lever and provides us with increased confidence in reducing debt faster than originally expected.

And later;

Subject to Board approval, future ordinary dividends are expected to be paid half-yearly with approximately one third of the dividend paid as an interim dividend, following the Company's half-year results and paid in October, and the balance paid as a final dividend, subject to shareholder approval, following the Company's Annual General Meeting.

https://www.investegate.co.uk/haleon-pl ... 00045925R/

Ian.

[funduffer]

So a minuscule dividend, albeit based on 6 months.

So, not a HYP share. Is it a growth share? Will it be a steady-eddy like Unilever, or Reckitt?

I can’t work out what HLN is going to be.

FD

[idpickering]

So a minuscule dividend, albeit based on 6 months.

So, not a HYP share. Is it a growth share? Will it be a steady-eddy like Unilever, or Reckitt?

I can’t work out what HLN is going to be.

FD

Agreed on all points. The market's not keen either it seems, with the HLN SP being down 3.2% as I type.

Ian.

[monabri]

I thought HLN was being held not for it's yield but for the hope someone would buy it out for a premium?

[funduffer]

I thought HLN was being held not for it's yield but for the hope someone would buy it out for a premium?

Yes, maybe that's it.

Unilever tried to do that before the de-merger and made a bit of a horlicks of it!

FD

[idpickering]

2023 Q1 Trading Statement.

Strong start to the year demonstrating continued strength of portfolio

●

Q1 reported revenue +13.7%, +9.9% organic with price +7.1% and positive volume/mix +2.8%

●

Strong start to the year with growth across all categories except VMS which declined largely due to the strong comparative for Emergen-C in the US

●

Performance was strong across geographies, with EMEA and LatAm and APAC growing double digit and mid-single digit growth in North America

●

Positive volume mix across all regions despite annualising the impact of the prior year ERP systems cutover and distribution business model change2



Increased operating profit driven by positive operational leverage

●

Q1 Reported operating profit +34.5% to £627m reflecting a large reduction in separation and admission costs

●

Q1 Adjusted operating profit1 +9.5% to £691m, up 3.3% constant currency, largely reflecting positive operational leverage which was partly offset by higher standalone costs and adverse transactional foreign exchange. As a result, Q1 Adjusted operating profit margin was 23.1%, down 90 bps (140 bps constant currency).

https://www.investegate.co.uk/announcement/7509676

Ian (No holding).

[idpickering]

Haleon Half Year Results 2023.

Strong growth, driven by price with another quarter of positive volume mix

●

H1 revenue +10.6% to £5,738m, organic growth1 +10.4% with 7.5% price and 2.9% volume/mix

●

Power Brands +10.1% organic growth1; with Sensodyne, parodontax, Panadol, Denture Care and Otrivin standouts

●

55% of our business gained or maintained market share2 year to date



Increased operating profit given positive operational leverage

●

H1 Adjusted operating profit1 increased 8.9% constant currency to £1,271m

●

H1 Adjusted operating profit margin1 22.2%, down 40bps constant currency

●

H1 Reported operating profit increased 26.8% to £1,141m



Strong execution in delivering on deleveraging commitment

●

H1 net cash flow from operating activities was £749m with Free cash flow of £369m

●

Net debt at 30 June 2023 was £9,525m, representing 3.4x last 12 months net debt/adjusted EBITDA1

●

Agreed disposal of Lamisil for aggregate consideration of £235m; we expect total cash realised in connection with the disposal to be around £250m4. Completion expected in Q4.

●

Interim dividend declared of 1.8 pence per share

And later;

An interim dividend of 1.8 pence per share has been declared by the Board and is expected to be paid on 5 October 2023 to the holders of ordinary shares and US American Depositary Shares (ADS).

https://www.investegate.co.uk/announcem ... 23/7669950

Ian (No holding).