Kenvue CEO looks to brand, product innovation to drive growth after IPO

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Thibaut Mongon, CEO of Johnson & Johnson consumer-health business Kenview Inc., speaks during an interview with CNBC during his company’s IPO on the New York Stock Exchange (NYSE) on May 4, 2023.

Brendan McDermid | reuters

Kenview CEO thibaut mongon Betting on brand and product innovation to drive growth new spun-out company anymore hot start Thursday in the public market.

“In the next quarter and clearly, in the years to come, we will continue to do what we do best, which is innovating to find new ways to serve consumers and help them take better care of their health.” is,” Mongon told CNBC in an interview shortly after the shares kenview Began trading on the New York Stock Exchange.

Shares of the company closed Thursday up 22% at $26.90 per share. The stock hovered around that level in early trading Friday, giving the company a market value of about $50 billion.

Kenview exited Johnson & Johnsoncarries pack portfolio of widely known brands such as Band-Aid, Tylenol, Listerine, Neutrogena, Aveeno and J&J’s namesake baby powder.

Ten of Kenview’s brands booked nearly $400 million or more in sales last year, according to a preliminary prospectus The company filed with the Securities and Exchange Commission last week.

But Mongon told CNBC that there is “substantial opportunity” to grow within Kenview’s portfolio of brands.

The company’s plans for product innovation include new science and technologies to develop new products that meet consumers’ specific needs in a way that hasn’t been done before, according to Mongon.

Kenview has a team of approximately 1,500 research and development professionals who identify new ways to enhance a given product.

Mongon believes product innovation ultimately makes Kenview’s brands “more relevant than ever” to consumers because they better target their needs.

“There are no limits to the way you can better take care of your health and there are no limits to inventing products and solutions to help you do so,” Mongon told CNBC.

As an example, Mongon pointed to the sunscreens launched under the Neutrogena brand. The company designed the product, neutrogena invisibleMost sunscreens leave behind, eliminating a consumer pain point for applying protection, without leaving a chalky white residue to blend into the skin.

As a result, Mongon said, that product can reach consumers who may not regularly use traditional sunscreens.

“This is our contribution to the world. To provide these consumers with a solution: strong sun protection but also great aesthetics,” Mongon said. “More people than ever should be using sunscreen regularly, which we know is so important for the skin.”

According to the company’s prospectus, the company has launched more than 100 new product innovations every year since 2020. The company said in its filing that product innovations launched during the last three years have contributed to approximately $1.5 billion in total sales of Kenview.

Mongon said the company will “continue to push the envelope” in launching new products in the coming years.

brand innovation

According to Mongon, Kenvue will use a “digital-first approach” to provide a more personalized experience with the company’s brands. This includes new e-commerce and direct-to-consumer services.

For example, the Zyrtec brand has its own Allergy Prediction App Called “Allergycast”. Zyrtec is a medicine designed to relieve allergy symptoms such as watery eyes, runny nose, sneezing and itching.

Mongon said Kenview designed the app to help consumers manage their allergies, allowing them to track pollen levels and their allergy symptoms. The app could eventually predict how severe a consumer’s allergies would be based on their location, weather conditions and symptom history.

“You will receive messages that allow you to better understand and manage your symptoms,” Mongon told CNBC. “It’s part of the innovation we focus on at Kenview.”

Kenview also designed “smartcheck” Digital Ear Scope, a drug that reduces fever and treats minor aches and pains, under the Tylenol brand.

SmartCheck is a personal ear scope device and app that turns a smartphone into an otoscope, used to look into the ear. The app allows users to take a recording of a child’s potentially infected eardrum and send it to a healthcare provider or telehealth service for diagnosis.

But Kenview noted in a preliminary prospectus that continuing to expand service and product offerings through “digital initiatives” exposes the company to additional risks, including potential technical failures, cyber security incidents, and consumer privacy and data protection concerns. Could

M&A not ruled out

When asked about the possibility of mergers and acquisitions, Mongon said that Kenview is primarily focused on organic growth.

But he added that the company is not completely ruling out future M&A.

He added that Kenuve has a strong track record of identifying the right brands in the market that can complement the company’s portfolio in a positive way.

“If we see an opportunity that makes sense strategically and financially we will thank the healthy balance sheet,” Mongon said.

Kenvu reported total assets of more than $27 billion as of January 1 on a pro forma basis, excluding the impact of costs associated with the public offering, and total liabilities of approximately $16 billion.

The company recorded total debt of nearly $9 billion as of the start of the year.

Kenview projects $14.95 billion in sales and $1.46 billion in net income on a pro forma basis for 2022, according to a preliminary prospectus.

Kenvue trades under the stock ticker “KVUE”.