1st Quarter Results

13th May 2004 STRONG START TO 2004 Q1 positions Company well to achieve full year targets Results at a Glance Q1 % change % change £m actual exch constant exch Net Revenues £920m +8% +12% Operating Profit £145m +24% +27% Net Income £105m +28% +31% * Net revenues grew by 8% (12% at constant exchange) to £920m. * Operating profit increased by 24% at actual exchange to £145m. Operating margin rose by 200 basis points (bps) to 15.8% behind a gross margin increase of 160 bps to 53.7% and after a substantial increase in marketing, mainly media, investment behind recent product innovations. * Net income increased 28% to £105m. * Strong cash generation saw net funds of £448m, an increase of £156m compared to December 2003, after share buyback of £61m. Net Working Capital was reduced by a further £67m. * These results were driven by the success of recent initiatives. Significant contributors included Vanish Oxi Action in-wash and Carpet Cleaner, Lysol Ready Brush lavatory cleaner, Airwick Aroma Oils electrical air care and Veet Rasera bladeless razor kit. Commenting on these results, Bart Becht, Chief Executive Officer, said 'Reckitt Benckiser made a strong start to 2004. Net revenue growth was 12% at constant exchange with profit growth substantially ahead of that rate. Strong net revenue growth came behind the continued success of our product innovations such as Vanish Oxi Action and Lysol Ready Brush, and was further helped by strong flu and pest season conditions in the first quarter. 'These results position us well to reach our full year targets of net revenue growth of 5% plus and net income growth of low double digits, both at constant exchange.' Detailed Operating Review Q1 Net revenues grew 8% (12% constant) to £920m. The significant exchange rate impact on translation in Q1 arose from the weakness of the US dollar and dollar-linked currencies only slightly offset by Euro strength in comparison to average rates in Q1 2003. Gross margin increased by 160 bps to 53.7% due to higher margin new products, lower input costs and savings from ongoing cost optimization programs, Squeeze and Xtrim. Marketing investment was higher in total; media investment increased by 16% to a level of 12.5% of net revenues. Operating margins increased by 200 bps to 15.8% due to strong gross margin expansion and favorable fixed cost development, offset by the above mentioned increase in marketing investment. Operating profit grew 24% (27% constant) to £145m. Net income was £105m, an increase of 28% (31% constant). Category Review at constant exchange rates. Fabric Care. Net revenues grew by 14% to £256m. Fabric Treatment contributed strongly due to the continuing success of Vanish Oxi Action in-wash powder and gel and the initial success of Vanish Oxi Action Carpet Cleaner. Surface Care. Net revenues grew by 10% to £184m primarily due to lavatory care and multi-purpose cleaners. Lavatory care growth came behind the initial success of Lysol Ready Brush. Multipurpose cleaners grew due to recovery in Developing Markets. Dishwashing. Net revenues grew 4% to £140m. Calgonit/Finish automatic dishwashing grew in Europe behind 3-in-1 Brilliant, and Protector. Sales in North America grew further behind share gains for Electrasol with Jet Dry Action. Home Care. Net revenues grew by 13% to £133m. Air Care growth recovered behind the success for Airwick Aroma Oils and Decosphere in North America. Pest control grew strongly due to a strong pest season and the success of Mortein Professional in Australia New Zealand and Mortein Power Booster Coils in Asia. Health & Personal Care. Net revenues grew 20% to £138m. Veet Depilatories grew across all regions behind the success of Veet Rasera bladeless razor. Dettol antiseptic grew in Developing Markets, responding to media and marketing investment and the success of its new sensitive skin soap variant. UK Health Care grew strongly behind a strong flu season for Lemsip and further growth for Gaviscon in Europe. Core Household. Net revenues grew 12% to £851m. Food. Net revenues grew strongly by 16% to £36m with good performance across the portfolio, but particularly behind the recently launched Frank's Red Hot Chile & Lime, continuing growth for French's Gourmayo, and recovery in the food service channel. Geographical Analysis at constant exchange Europe 53% of net revenues Net revenues grew 10% to £492m. The major contributors were Vanish fabric treatment, Finish/Calgonit automatic dishwashing, Veet depilatories and Healthcare. Fabric treatment growth came behind the success of Vanish Oxi Action in-wash powder and gel and the initial success of Vanish Oxi Action carpet cleaner. Finish / Calgonit grew behind 3-in-1 Brilliant and Glass Protector. Veet depilatories grew strongly behind the introduction of Veet Rasera bladeless razor kit. Healthcare grew due to a strong UK flu season resulting in increased Lemsip sales, and to continuing growth for Gaviscon in Europe. Operating margins increased 120bps in the quarter to 19.9% with gross margin expansion and favorable fixed cost development partially offset by higher marketing investment. Operating profit increased by 18% to £98m. North America & Australia 30% of net revenues Net revenues grew 11% to £276m. The portfolio performed strongly but particularly fabric treatment, lavatory care, automatic dishwashing, air care, pest control and depilatories. Fabric treatment grew behind Spray 'n Wash in-wash in North America. Lavatory care grew due to the launch of Lysol Ready Brush. Automatic dishwashing grew behind further market share growth for Electrasol with Jet Dry Action. Air Care grew behind the launch of Airwick Aroma Oils and further growth for Airwick Decosphere. Pest control growth came in Australia due to a strong pest season and the launch of Mortein Professional barrier spray. The launch of Veet Rasera bladeless razor kit brought growth in depilatories. Suboxone continues to grow strongly from a small base following licensing by the FDA in 2002. Operating margins improved by 160bps to 15.2% due to strong gross margin improvement and lower fixed costs as a percentage of net revenues, somewhat offset by higher marketing, particularly media, investment. Operating profit increased 24% to £42m. Developing Markets 17% of net revenues Net revenues grew 25% to £152m with strong growth across all regions of Asia, Latin America and Africa Middle East. The major contributors to growth were Vanish Oxi Action across all regions; recovery in multi-purpose cleaners, particularly Veja in Brazil; strong pest season conditions and the success of Mortein Power Booster coils in pest control; and strong growth for Dettol behind the new skincare soap and higher investment. Operating margins improved by 330bps to 3.3% due to strong gross margin improvement and tight control of fixed costs, plus favorable product mix. Operating profit was £5m (2003 nil). Financial Review Net interest halved to £3m due to strong cash inflow in 2003 and in Q1 2004 increasing the net funds position. Tax on profit for the quarter was £37m. The tax rate for the period was 26%. Net working capital (stock, short-term debtors and short-term creditors other than borrowings) reduced by £67m to £645m negative in the quarter. Net Funds of £448m increased by £156m during the quarter due to higher profits, reduced net working capital and tight control of capital employed, despite the cash outlay of £61m for buying back shares. During the quarter, the Company repurchased 4.5m shares at a cost of £61m. The cumulative total of shares repurchased under the Company's program to date is 7m shares at a cost of £95m. Half Year Results. The Company will release results for the six months to 30 June 2004 on Monday 26th July. Due to the significantly earlier release of these results, it is not the Company's intention to release a Q2 preview. For further information Reckitt Benckiser +44 (0)1753 217 800 Tom Corran SVP Investor Relations & Corporate Communications Elvira Luykx Global Communications Manager Mark Wilson Investor Relations Manager PR Agency Tim Spratt Financial Dynamics +44 (0)207 837 3113 The Group at a Glance (unaudited) Quarter Ended March 31 2004 2003# £m £m From total ordinary activities Net revenues 920 848 Net revenues growth 8% 2% Gross margin 53.7% 52.1% EBITDA 167 139 EBITDA margin 18.2% 16.4% EBIT 145 117 EBIT margin 15.8% 13.8% Profit before tax 142 111 PBT margin 15.4% 13.1% Net Income 105 82 Net Income margin 11.4% 9.7% EPS 14.8p 11.6p EPS, diluted 14.2p 11.3p # Restated following the adoption of FRS 5 Application Note G 'Revenue Recognition' Selected Financial Information (unaudited) Group Balance Sheet Data March 31, December 31, 2004 2003 £m £m Net working capital* (645) (578) Net funds 448 292 * Defined as stock, short term debtors and short term creditors excluding borrowings. Group profit and loss account (unaudited) Quarter Ended March 31 2004 2003# % change £m £m Net revenues 920 848 8% Cost of sales (426) (406) 5% Gross profit 494 442 12% Net operating expenses (349) (325) 7% Total operating profit 145 117 24% Net interest expense (3) (6) (50%) Profit on ordinary activities before 142 111 28% taxation Tax on profit on ordinary activities (37) (29) 28% Profit on ordinary activities after taxation 105 82 28% Attributable to equity minority interests 0 0 Profit for the period 105 82 28% Earnings per ordinary share: On profit for the period 14.8p 11.6p On profit for the period, diluted 14.2p 11.3p Average common shares outstanding: Basic 707.9 705.9 Diluted 761.4 755.6 # Restated following the adoption of FRS 5 Application Note G 'Revenue Recognition' Segmental Analysis (unaudited) Analyses by geographical area and product segment of net revenues and operating profit are set out below. The figures for each geographical area show the net revenues and profit made by companies located in that area. As announced on 19 April 2004, the Group presents its 2004 results aligned with its management structure, being Europe, North America & Australia and Developing Markets. The Group views these Areas as separate management entities, each with different risks and rewards, and therefore it is appropriate to use these Areas for external commentary on the Group's performance. This presentation will also comply with International Financial Reporting Standards, which the Group will adopt in 2005. Quarter Ended March 31 2004 2003* % change £m £m exch. rates actual const. Net revenues - by geographical area Europe 492 444 11% 10% North America & Australia 276 272 1% 11% Developing Markets 152 132 15% 25% 920 848 8% 12% Operating profit - by geographical area Europe 98 83 18% 18% North America & Australia 42 37 14% 24% Developing Markets 5 - Corporate 0 (3) 145 117 24% 28% Operating margin - by geographical area % % Europe 19.9 18.7 North America & Australia 15.2 13.6 Developing Markets 3.3 - 15.8 13.8 * Restated following the adoption of FRS 5 Application Note G 'Revenue Recognition' and the alignment of the reported geographical segments with the internal management structure of Reckitt Benckiser. Segmental Analysis (continued) Quarter Ended March 31 2004 2003# % change £m £m exch. Rates Actual Const. Net revenues - by product segment Household and Health & Personal Care 884 813 9% 12% Food 36 35 3% 16% 920 848 8% 12% Operating profit - by product segment Household and Health & Personal Care 143 119 20% 23% Food 2 1 100% 100% Corporate 0 (3) - - 145 117 24% 28% Operating margin - by product segment % % Household and Health & Personal Care 16.2 14.6 Food 5.6 2.9 15.8 13.8 Net revenues - Household and Health & Personal Care Fabric Care 256 228 12% 14% Surface Care 184 178 3% 10% Dishwashing 140 137 2% 4% Home Care 133 124 7% 13% Health & Personal Care 138 117 18% 20% Core Business 851 784 9% 12% Other Household 33 29 14% 18% 884 813 9% 12% # Restated following the adoption of FRS 5 Application Note G 'Revenue Recognition'

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