Shares in Haleon have fallen by over 14% after the multinational consumer healthcare company cut its full-year organic revenue growth forecast to 2.5%.

The firm reported in its Q3 update that its organic revenue growth increased by 2.6% in the three months to 30 September to £2.86bn, with continued strength in its oral health division, which rose by 8.8% year-on-year.

However, it stated that its performance was held back due to soft cold and flu consumption, which led to lower orders in North America and a raw material classification change for Centrum over the counter (OTC) products in China.

The update comes after Haleon, which owns brands including Sensodyne, Beechams and Panadol, launched the evolution of its operating model to "drive growth and agility in support of its Win as One ambition".

This has resulted in a "structural reporting change" to reflect the organisation, and going forward, it will report performance against this structure.

CEO at Haleon, Brian McNamara, stated: "Our third quarter organic revenue growth of 2.6% was below our expectations as we navigated softness across some of our categories including weaker cough, cold and flu consumption. We delivered strong performances in oral health and our turnaround plan in North America continues to make progress. We are clear on where we need to improve and we are taking action to deliver stronger performance despite challenging markets.

"High gross margin and continued progress on supply chain productivity provide us with a uniquely strong platform to invest behind our brands and capabilities while delivering strong growth in profit and cash. This also enables us to continue returning surplus capital to shareholders, and today we are announcing a further £500m allocation to share buybacks.

"Our key priority is to drive stronger volume growth and return the business to consistent delivery of our medium-term growth guidance."

Haleon stated in its outlook that its full-year guidance now incorporates the impact from the raw material classification change impacting Centrum’s OTC-registered products in China, as well as an expected impact of the acceleration of its new go-to-market model in Brazil.

As a result, it has lowered its organic revenue growth to around 2.5%, with high-single-digit adjusted operating profit growth at constant currency.

Consumer staples analyst at Quilter Cheviot, Chris Beckett, described the results as a "disappointing quarter", but has said there are positives to be taken from its update.

He concluded: "A weak cold and flu season has weighed on respiratory products, while the problems importing Centrum products into China have provided another unwelcome headwind. Europe has also been difficult, reflecting continued caution among consumers.

"There are still some real bright spots, particularly oral health, where Sensodyne continues to perform strongly, and importantly Haleon has maintained its profit expectations. With just one quarter of the year remaining, lowering the sales guidance is disappointing but realistic rather than a sign of a fundamental deterioration in the business.

"We remain positive on Haleon over the longer term. Healthcare systems around the world are under mounting cost pressure, which should support greater use of trusted OTC medicines and make consumer healthcare one of the more attractive areas of the consumer sector. While this was undoubtedly a poor quarter, we still think the underlying category and Haleon’s portfolio of brands offer an attractive long-term growth story."

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