China's consumer sentiment is down, but not when it comes to condoms
Reuters
Published Jul 26, 2023 06:43AM ET
By Richa Naidu
LONDON (Reuters) - Consumer companies and economists have said sentiment in China is slower than expected, but that's not stopping them from buying more condoms, Durex maker Reckitt said on Wednesday.
Economic data from China this month showed its post-pandemic surge was quickly fading, raising expectations that the government needs to bring out more stimulus measures to drive activity and bolster shaky consumer confidence.
British consumer goods giant Unilever (NYSE:UL) said on Tuesday that China's declining property market and exports had sent its consumer sentiment to a historic low, having earlier this year forecast a Chinese "consumption boom".
Nonetheless, on Wednesday when Reckitt reported earnings results, it said like-for-like net revenue growth in its health business was 8.8%. The growth was led in part by its "Intimate Wellness" brands, which include K-Y lubricant, with improving performance in China.
Globally, the portfolio grew by high-single digits, and in China Reckitt saw "the benefit of re-opening post COVID-related lockdowns."
Despite a "little slower" recovery in China overall, sales of intimate wellness products are higher. CEO Nicandro Durante said that firstly, Reckitt is launching innovations such as new materials for condoms, and second, people "are enjoying the nightlife".
Reckitt has a new Taicang, China-based production facility, according to its website, set to "produce our thinnest Durex polyurethane condoms ever" for that market.
"The phase 2 Durex project construction is about to get underway, with the facility set to go into operation in January 2026," Reckitt's website says. "The site will produce the thinnest Durex PU condoms in history and will be committed to the continuous improvement of new technologies for PU condoms."
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Written By: Reuters
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