'Powermarkets' push as Reckitt targets emerging countries

Kapoor - who took over from £90 million man Bart Becht last September - is leading a push into 16 faster-growing "powermarkets" and launching a crackdown on costs across the group in hard-pressed Western markets.

Reckitt is also channelling an extra £100 million investment into its leading health and hygiene brands which include Durex, Nurofen, and toilet cleaner Harpic.

Kapoor said 2012 would be a year of "transition and investment", and warned: "With slower market growth and increased competition, we need to reshape our strategy."

Reckitt expects its global market to grow by a sluggish 1-2% this year, but Kapoor is hoping to grow the business at double that rate by putting more emphasis on the company's health and hygiene products. These generate the highest profit margins, growth and consumer loyalty, and should account for 72% of its core business by 2016, up from 67% currently.

This leaves Reckitt's foods and pharmaceuticals businesses, which includes heroin treatment suboxone, out in the cold, while the firm is also looking at closing down its non-branded private label business.

In addition, Kapoor wants to take emerging market exposure to 50% of the group's revenues from the current 42% by 2016.

Declining Western markets underlined the urgency of the strategy as sales fell 1% in Europe amid aggressive price cutting and competition, in contrast to emerging markets, where sales roared ahead 13%. Overall sales were up 12% to £9.5 billion last year.

The firm has around 21,000 employees worldwide, but also raised the spectre of job cuts today as it pencilled in £75 million in costs this year to push through the merger of its European and North American divisions.

The restructuring is expected to save £30 million a year from 2013, although the company refused to comment on possible job losses. The company's shares added 95p to 3477p, although many City analysts remained unconvinced by Kapoor's plans.

For instance, Panmure Gordon's Graham Jones said: "The trading outlook for this year looks uninspiring."

Liberum Capital's Pablo Zuanic added: "Today's two press releases say to us 2012-13 consensus earnings estimates have to come down".

Zuanic said Reckitt's renewed focus on health and hygiene was "a sign of the company's weakened position in the household care business."