LONDON—Reckitt Benckiser Group PLC lowered its outlook for the year and reported third-quarter sales that missed estimates on a sharp slowdown in growth in the consumer-goods company's health business.

Shares in the maker of Durex condoms and Strepsils cough drops fell 2.1% in early trading in London.

Reckitt said like-for-like sales for the three months ended Sept. 30 rose by 2% compared with the same period last year, missing the 2.8% expected by analysts and marking the lowest growth during Chief Executive Rakesh Kapoor's tenure.

The company is now targeting full-year like-for-like sales growth of 4%, the second time it has guided estimates slightly lower in three months. In July, Reckitt said it expected growth to come in toward the lower end of the 4% to 5% target it gave in February.

Under Mr. Kapoor—who became CEO in 2011—the Slough-headquartered company has sharpened its focus on higher-margin consumer health and made a string of acquisitions aimed at beefing up the business.

The consumer-health unit's growth has slowed in recent quarters, coming in at just 2% in the third quarter compared with 14% a year earlier. Reckitt said part of that decline stemmed from disappointing sales of a new model of a foot file, used for buffing away dry skin, developed at its Scholl footcare unit.

Reckitt's performance signals how European consumer-goods companies have struggled to log robust sales growth in tough macroeconomic conditions marked by currency swings and the rise of local competitors.

Unilever PLC last week reported a 3.4% rise in underlying third-quarter revenue that was driven entirely by price increases with no volume growth in a report from the Anglo-Dutch company that analysts largely perceived as being weak.

French yogurt and bottled-water company Danone on Tuesday reported third-quarter revenue that missed estimates as regulatory changes in China slowed sales of baby food.

Wednesday, Reckitt highlighted a particularly tough environment in Russia where it said "a significant decline in consumer demand" had dragged on growth, adding that the outlook there remains uncertain. The company flagged strong growth in India and China, but cautioned that Brazil remains a tough market.

For the third quarter, same-store sales in hygiene—Reckitt's largest division—rose 5% as brands like Dettol, Harpic and Finish logged strong growth.

The home-products arm, which includes brands like Air Wick and Vanish, reported that same-store sales declined 2%. The business, which sells twice as much in developed markets than in emerging markets has reported sluggish sales growth for years despite many innovations.

Lately, the unit's sales have been knocked lower by a boycott of Reckitt's products in South Korea after a humidifier disinfectant was found in 2011 to be linked to the deaths of over 100 people there.

Reckitt took years to publicly address the humidifier-disinfectant deaths—only disclosing them to shareholders this summer following a mounting backlash in South Korea—but has recently apologized. The company has been working to regain its footing there by offering compensation to victims.

Overall, Reckitt's problems in South Korea dragged down like-for-like sales in the quarter by 1.5%.

RBC analyst James Edwardes Jones noted that for Reckitt to hit its growth target for the year, the company will have to report like-for-like growth of 4% in the fourth quarter, "which isn't straightforward" given a tough comparison with a strong year-ago period in increasingly tough trading conditions.

--Tapan Panchal contributed to this article

Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com

 

(END) Dow Jones Newswires

October 19, 2016 05:25 ET (09:25 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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