Clorox Reports Q4 and FY25 Results, Provides FY26 Outlook
Delivers strong margin expansion and adjusted EPS growth for FY25 despite challenging environment in the second half of the fiscal year
Fourth-Quarter Fiscal Year 2025 Summary
The following is a summary of key fourth-quarter results, which reflect the temporary benefit from incremental shipments related to building retailer inventory in advance of the enterprise resource planning transition in the
-
Net sales increased 4% to
$2.0 billion , primarily driven by the impacts of the incremental ERP shipments, partially offset by the divestiture of the VMS business and unfavorable price mix. Organic sales1 increased 8%. Incremental ERP shipments contributed about 13 to 14 points of benefit to net sales. - Gross margin was 46.5%, essentially flat versus the year-ago quarter, primarily due to higher volume and cost savings, offset by both higher manufacturing and logistics costs and trade promotion spending. Incremental ERP shipments contributed about 150 basis points of benefit to gross margin.
-
Diluted net earnings per share (diluted EPS) increased 55% to
$2.68 from$1.73 in the year-ago quarter. The increase includes lapping the implementation of the company's streamlined operating model partially offset by insurance recoveries, net of incremental costs, related to theAugust 2023 cyberattack in the prior period. -
Adjusted EPS
1 increased 58% to
$2.87 from$1.82 in the year-ago quarter, due in part to higher volume. The benefit from incremental ERP shipments is estimated to be about 85 to95 cents .
"While we delivered strong margin expansion and adjusted EPS growth for the year, we did not meet our topline expectations in the back half. We continued to see rapidly shifting consumer behaviors and broader market volatility which we expect to continue," said Chair and CEO
This press release includes certain non-GAAP financial measures. See "Non-GAAP Financial Information" at the end of this press release for more details.
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1 Organic sales growth/(decrease) and adjusted EPS are non-GAAP measures. See Non-GAAP Financial Information at the end of this press release for reconciliations to the most comparable GAAP measures. |
Strategic and Operational Highlights
The following are recent highlights of business achievements:
- Delivered another quarter of strong cost savings as part of the company's effort to expand margin while growing overall market shares and organic sales for the fiscal year.
- Executed strong preparation, which included building retailer inventory, ahead of its ERP launch in the
U.S. at the beginning of fiscal year 2026 as part of its ongoing work to accelerate digital transformation through modernized technologies and processes. - Continued to invest behind value superiority with innovations across major brands in fiscal year 2025, such as the relaunch of Poett's fragrance platform, enhanced durability in Glad ForceFlex MaxStrength trash bags, Fresh Step Heavy Duty and Health Monitoring Clumping Litter, Clorox Scentiva Bleach, the expansion of the
Burt's Bees portfolio with Boosted Tinted Balm and Rescue Lip Relief, seven newHidden Valley Ranch flavors as well as product partnerships with Hot Pockets,Taco Bell ,Burger King , and DiGiorno. - Named a
Best Company to Work For byU.S. News & World Report , one of America's Greatest Workplaces by Newsweek and one of Forbes' Net-Zero Leaders.
Key Segment Results
The following is a summary of key fourth-quarter results by reportable segment. All comparisons are with the fourth quarter of fiscal year 2024, unless otherwise stated.
Net sales increased 4%, driven by 8 points of higher volume, partially offset by 4 points of unfavorable price mix. Higher volume was mainly driven by the incremental ERP shipments. Unfavorable price mix was driven mainly by unfavorable product mix and higher trade promotion, which was mainly driven by unfavorable trade expense timing.
Health and Wellness (Cleaning; Professional Products)
- Net sales increased 14%, driven by 18 points of higher volume, partially offset by 4 points of unfavorable price mix. Higher volume was mainly driven by the incremental ERP shipments. Unfavorable price mix was driven by higher trade promotion spending and strong shipments to the Club channel.
- Segment adjusted EBIT2 increased 20%, primarily driven by higher net sales and lower advertising, partially offset by both higher selling and administrative costs and manufacturing and logistics costs.
Household (Bags and Wraps; Cat Litter; Grilling)
- Net sales increased 7%, driven by 13 points of higher volume, partially offset by 6 points of unfavorable price mix. Higher volume was mainly driven by the incremental ERP shipments, partially offset by lower consumption and increased competition. Unfavorable price mix was driven by unfavorable product mix, mainly due to Club merchandising in Litter.
- Segment adjusted EBIT increased 59%, primarily driven by higher volume.
Lifestyle (Food; Water Filtration; Natural Personal Care)
- Net sales increased 3%, driven by 8 points of higher volume, partially offset by 5 points of unfavorable price mix. Higher volume was mainly driven by the incremental ERP shipments, partially offset by lower consumption. Unfavorable price mix was driven by higher trade promotion spending and unfavorable product mix.
- Segment adjusted EBIT increased 54%, primarily driven by lower advertising.
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2 Adjusted EBIT is a non-GAAP measure. See Non-GAAP Financial Information at the end of this press release for reconciliations to the most comparable GAAP measures. |
International (Sales Outside the
- Net sales decreased 1%, mainly driven by 4 points of unfavorable price mix and 2 points of unfavorable foreign exchange rates, partially offset by 5 points of higher volume. Organic sales increased 1%. Higher volume was mainly driven by the incremental ERP shipments. Unfavorable price mix was driven by product mix and higher trade promotion spending.
- Segment adjusted EBIT increased 28%, primarily due to higher volume, both lower selling and administrative and advertising expenses, partially offset by unfavorable mix and higher trade promotion spending.
Fiscal Year 2025 Summary
The following is a summary of key fiscal year 2025 results, which reflect the incremental ERP shipments and the prior divestitures of the VMS and
- Net sales were essentially flat, primarily driven by 1 point of higher volume offset by 1 point of unfavorable price mix. Organic sales increased 5%. Incremental ERP shipments contributed about 3.5 to 4 points of benefit to net sales, which is expected to reverse in fiscal year 2026.
-
Gross margin increased 220 basis points to 45.2% from 43.0% in the year-ago period. The increase was primarily driven by cost savings, higher volume and the benefits of the divestitures of the Better Health VMS and
Argentina businesses, partially offset by higher trade promotion spending, unfavorable mix and higher manufacturing and logistics costs. The benefit from ERP incremental shipments is estimated to be about 50 basis points, which is expected to reverse in fiscal year 2026. -
Diluted EPS increased 190% to
$6.52 from$2.25 in the year-ago period. This increase includes lapping the divestiture of theArgentina business, the pension settlement charge, implementation of the streamlined operating model in the prior period, and the current-period benefit of cyberattack insurance recoveries, partially offset by the loss on the sale of the VMS business. The benefit from ERP incremental shipments is estimated to be about 85 to95 cents , which is expected to reverse in fiscal year 2026. -
Adjusted EPS increased 25% to
$7.72 from$6.17 , driven mainly by higher volume and cost savings initiatives. These factors were partially offset by unfavorable mix and higher trade promotion spending. The benefit from ERP incremental shipments is estimated to be about 85 to95 cents , reflecting year-over-year growth of 14% to 15%, which is expected to reverse in fiscal year 2026. -
Net cash provided by operations was
$981 million compared to$695 million in fiscal year 2024, representing a 41% increase.
ERP Transition Impact
During the fourth quarter of fiscal year 2025, retailers placed orders in advance of the company's ERP system transition in the
Fiscal year 2025 |
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Net sales (percentage change versus the year ago period) |
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Net sales growth / (decrease) (GAAP) |
4 % |
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0 % |
Add: Foreign Exchange |
— |
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— |
Add/(Subtract): Divestitures/acquisitions |
4 |
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5 |
Organic sales growth / (decrease) (non-GAAP) |
8 % |
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5 % |
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Note: Approximate benefit from incremental shipments related to ERP |
+13% to +14% |
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3.5% to 4% |
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Diluted earnings per share |
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As reported (GAAP) |
$ 2.68 |
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$ 6.52 |
Loss on divestiture |
— |
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0.94 |
Cyberattack costs, net of insurance recoveries |
— |
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(0.42) |
Digital capabilities and productivity enhancements investment |
0.19 |
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0.68 |
As adjusted (non-GAAP) |
$ 2.87 |
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$ 7.72 |
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Note: Approximate benefit from incremental shipments related to ERP |
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Fiscal Year 2026 Outlook
The most significant assumption of the fiscal year 2026 outlook is the transitory impact related to the ERP transition in the
- Net sales are expected to be down 6% to 10% compared to the prior year. The company expects less than a point of negative impact from the divestiture of its VMS business and foreign exchange rate changes. Organic sales are expected to decrease 5% to 9%, including a negative impact of about 7 to 8 points related to the reversal of the impact from incremental shipments associated with the ERP transition in the prior fiscal year.
- Gross margin is expected to be down 50 to 100 basis points. The reversal of the impact from incremental shipments associated with ERP transition in the prior fiscal year is expected to result in about a 100 basis points of headwinds.
- Selling and administrative expenses are expected to be about 16% of net sales, which includes about 90 basis points of impact from the company's strategic investments in digital capabilities and productivity enhancements.
- Advertising and sales promotion spending is expected to be about 11% of net sales, reflecting the company's ongoing commitment to invest behind its brands.
- The company's effective tax rate is expected to be about 24%.
- Diluted EPS is expected to be between
$5.60 and$5.95 , a year-over-year decrease of 14% to 9%, respectively. This includes the negative impact of about 85 to95 cents related to the reversal of the impact from incremental shipments associated with the ERP transition in the prior fiscal year. - Adjusted EPS is expected to be between
$5.95 and$6.30 , or a decrease between 23% and 18%, respectively. Adjusted EPS excludes the long-term strategic investment in digital capabilities and productivity enhancements, estimated to be about35 cents . This includes the negative impact of about 85 to95 cents related to the reversal of the impact from incremental shipments associated with the ERP transition in the prior fiscal year.
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Net sales (percentage change versus the year ago period) |
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Fiscal year 2025 |
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Fiscal year 2026 full year outlook |
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Impact |
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Low |
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High |
Net sales growth / (decrease) (GAAP) |
0 % |
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(10) % |
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(6) % |
Add: Foreign Exchange |
— |
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— |
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— |
Add/(Subtract): Divestitures/acquisitions |
5 |
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<1 |
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<1 |
Organic sales growth / (decrease) (non-GAAP) |
5 % |
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(9) % |
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(5) % |
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Note: Expected impact from incremental shipments related to |
3.5% to 4% |
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(8) % |
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(7) % |
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Diluted earnings per share |
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Fiscal year 2025 |
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Fiscal year 2026 full year outlook |
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Impact |
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Low |
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High |
As estimated (GAAP) |
$ 6.52 |
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$ 5.60 |
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$ 5.95 |
Loss on divestiture |
0.94 |
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— |
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— |
Cyberattack costs, net of insurance recoveries |
(0.42) |
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— |
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— |
Digital capabilities and productivity enhancements investment |
0.68 |
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0.35 |
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0.35 |
As adjusted (non-GAAP) |
$ 7.72 |
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$ 5.95 |
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$ 6.30 |
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Note: Expected impact from incremental shipments related to |
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$ (0.95) |
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$ (0.85) |
Clorox Earnings Conference Call Schedule
At approximately
At
Links to the live (and archived) webcast, press release and prepared remarks can be found at Clorox Quarterly Results.
For More Detailed Financial Information
Visit the company's Quarterly Results for the following:
- Supplemental unaudited volume and sales growth information
- Supplemental unaudited gross margin drivers information
- Supplemental unaudited cash flow information and free cash flow reconciliation
- Supplemental unaudited reconciliation of earnings (losses) before income taxes to EBIT and adjusted EBIT
- Supplemental unaudited reconciliation of adjusted earnings per share (EPS) and adjusted effective tax rate (ETR)
Note: Percentage and basis-point, or point, changes noted in this press release are calculated based on rounded numbers, except for per-share data and the effective tax rate.
About
CLX-F
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and any such forward-looking statements involve risks, assumptions and uncertainties. Except for historical information, statements about future volumes, sales, organic sales growth, foreign currencies, costs, cost savings, margins, earnings, earnings per share, diluted earnings per share, foreign currency exchange rates, tax rates, cash flows, plans, objectives, expectations, growth or profitability are forward-looking statements based on management's estimates, beliefs, assumptions and projections. Words such as "could," "may," "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," "will," "predicts," and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic and financial performance are intended to identify such forward-looking statements. These forward-looking statements are only predictions, subject to risks and uncertainties, and actual results could differ materially from those discussed. Important factors that could affect performance and cause results to differ materially from management's expectations, are described in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the company's Annual Report on Form 10-K for the fiscal year ended
The company's forward-looking statements in this press release are based on management's current views, beliefs, assumptions and expectations regarding future events and speak only as of the date of this press release. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the federal securities laws.
Non-GAAP Financial Information
- This press release contains non-GAAP financial information related to organic sales growth / (decrease), adjusted EPS, adjusted ETR and segment adjusted EBIT for the fourth quarter of fiscal year 2025 and for fiscal year 2025; as well as organic sales growth / (decrease) and adjusted EPS outlook for fiscal year 2026. The reasons management believes these measures are useful to investors are described below. Certain non-GAAP financial measures may be considered in determining incentive compensation.
- Clorox defines organic sales growth / (decrease) as GAAP net sales growth / (decrease) excluding the effect of foreign exchange rate changes and any acquisitions or divestitures.
- Organic sales growth / (decrease) outlook for fiscal year 2026 excludes less than a point of negative impact from divestiture of its VMS business and foreign exchange rate changes.
- Management believes that the presentation of organic sales growth / (decrease) is useful to investors because it excludes sales from any acquisitions and divestitures, which results in a comparison of sales only from the businesses that the company was operating and expects to continue to operate throughout the relevant periods, and the company's estimate of the impact of foreign exchange rate changes, which are difficult to predict and out of the control of the company and management. However, organic sales growth / (decrease) may not be the same as similar measures provided by other companies due to potential differences in methods of calculation or differences in which items are incorporated into these adjustments.
- Adjusted EPS is defined as diluted earnings per share that excludes or has otherwise been adjusted for significant items that are nonrecurring or unusual. The income tax effect on non-GAAP items is calculated based upon the tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment.
- Adjusted ETR is defined as the effective tax rate that excludes or that has otherwise been adjusted for significant items that are nonrecurring or unusual.
- Adjusted EPS and adjusted ETR are supplemental information that management uses to help evaluate the company's historical and prospective financial performance on a consistent basis over time. Management believes that by adjusting for certain items affecting comparability of performance over time, such as the pension settlement charge, incremental costs and insurance recoveries related to the
August 2023 cyberattack, asset impairments, charges related to the streamlined operating model, charges related to the digital capabilities and productivity enhancements investment, significant losses/(gains) related to acquisitions / divestitures and other nonrecurring or unusual items, investors and management are able to gain additional insight into the company's underlying operating performance on a consistent basis over time. However, adjusted EPS and adjusted ETR may not be the same as similar measures provided by other companies due to potential differences in methods of calculation or differences in which items are incorporated into these adjustments. - Adjusted EBIT represents earnings (losses) before income taxes excluding interest income, interest expense and other significant items that are nonrecurring or unusual (such as the pension settlement charge, incremental costs and insurance recoveries related to the
August 2023 cyberattack, asset impairments, charges related to the streamlined operating model, charges related to the digital capabilities and productivity enhancements investment, significant losses/(gains) related to acquisitions / divestitures and other nonrecurring or unusual items impacting comparability during the period). The company uses this measure to assess the operating results and performance of its segments, perform analytical comparisons, identify strategies to improve performance, and allocate resources to each segment. Management believes that the presentation of adjusted EBIT excluding these items is useful to investors to assess operating performance on a consistent basis by removing the impact of the items that management believes do not directly reflect the performance of each segment's underlying operations. However, adjusted EBIT may not be the same as similar measures provided by other companies due to potential differences in methods of calculation or differences in which items are incorporated into these adjustments. - The reconciliation tables below refer to the equivalent GAAP measures adjusted as applicable for the following items:
Divestiture of Better Health Vitamins, Minerals and Supplements Business
As previously disclosed in the first quarter of fiscal year 2025, the company completed the divestiture of its Better Health VMS business in its entirety. The divested business included the
Due to the nature, scope and magnitude of this charge, the company's management believes presenting this charge as an adjustment in the non-GAAP results provides additional information to investors about trends in the company's operations and is useful for period over period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by company management.
Cyberattack costs
As previously disclosed, incremental costs were incurred by the company as the result of the
Due to the nature, scope and magnitude of these costs and recoveries, the company's management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the company's operations and is useful for period over period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by company management.
Digital Capabilities and
As announced in
Of the total investment, approximately 75% is expected to represent incremental operating costs primarily recorded within selling and administrative expenses to be adjusted from reported EPS for purposes of disclosing adjusted EPS through fiscal year 2026, compared to the previous estimate of 70%. About 70% of these operating costs are expected to be related to the implementation of the ERP, with the remaining costs primarily related to the implementation of complementary technologies.
Due to the nature, scope and magnitude of this investment, these costs are considered by management to represent incremental transformational costs above the historical normal level of spending for information technology to support operations. Since these strategic investments, including incremental operating costs, will cease at the end of the investment period, are not expected to recur in the foreseeable future and are not considered representative of the company's underlying operating performance, the company's management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the company's operations and is useful for period-over-period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by company management.
The following tables provide reconciliations of organic sales growth/(decrease) (non-GAAP) to net sales growth/(decrease), the most comparable GAAP measure:
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Health and |
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Household |
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Lifestyle |
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International |
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Total |
Net sales growth / (decrease) (GAAP) |
14 % |
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7 % |
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3 % |
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(1) % |
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4 % |
Add: Foreign Exchange |
— |
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— |
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— |
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2 |
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— |
Add/(Subtract): Divestitures/Acquisitions (2) |
— |
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— |
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— |
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— |
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4 |
Organic sales growth / (decrease) (non-GAAP) |
14 % |
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7 % |
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3 % |
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1 % |
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8 % |
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Health and |
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Household |
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Lifestyle |
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International |
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Total |
Net sales growth / (decrease) (GAAP) |
9 % |
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3 % |
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2 % |
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(8) % |
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0 % |
Add: Foreign Exchange |
— |
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— |
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— |
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2 |
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— |
Add/(Subtract): Divestitures/Acquisitions (2) |
— |
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— |
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— |
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11 |
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5 |
Organic sales growth / (decrease) (non-GAAP) |
9 % |
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3 % |
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2 % |
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5 % |
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5 % |
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(1) |
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(2) |
The divestiture impact is calculated as net sales from the |
The following tables provide reconciliations of adjusted diluted earnings per share (non-GAAP) to diluted earnings per share, the most comparable GAAP measure, and adjusted effective tax rate (non-GAAP) to effective tax rate, the most comparable GAAP measure:
Adjusted Diluted Earnings Per Share (EPS) and Adjusted Effective Tax Rate (ETR) |
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(Dollars in millions except per share data) |
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Diluted earnings per share |
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Effective tax rate |
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% Change |
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As reported (GAAP) |
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$ 2.68 |
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$ 1.73 |
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55 % |
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18.2 % |
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19.7 % |
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Cyberattack costs, net of insurance recoveries (1) |
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— |
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(0.17) |
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— |
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(0.3) % |
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Streamlined operating model (2) |
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— |
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0.12 |
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— |
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0.2 % |
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Digital capabilities and productivity enhancements |
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0.19 |
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0.14 |
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0.4 % |
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0.3 % |
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As adjusted (Non-GAAP) |
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$ 2.87 |
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$ 1.82 |
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58 % |
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18.6 % |
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19.9 % |
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Diluted earnings per share |
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Effective tax rate |
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Twelve months ended |
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% Change |
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As reported (GAAP) |
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$ 6.52 |
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$ 2.25 |
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190 % |
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23.6 % |
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26.5 % |
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Loss on divestiture (4) |
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0.94 |
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1.85 |
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(2.3) % |
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(8.6) % |
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Pension settlement charge (5) |
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— |
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1.04 |
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— |
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0.9 % |
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Cyberattack costs, net of insurance recoveries (1) |
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(0.42) |
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0.17 |
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(0.1) % |
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0.2 % |
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Streamlined operating model (2) |
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— |
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0.20 |
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— |
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0.2 % |
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Digital capabilities and productivity enhancements |
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0.68 |
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0.66 |
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0.2 % |
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0.9 % |
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As adjusted (Non-GAAP) |
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$ 7.72 |
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$ 6.17 |
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25 % |
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21.4 % |
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20.1 % |
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(1) |
During the three months ended |
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(2) |
During the three and twelve months ended |
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During the three and twelve months ended |
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External consulting fees (a) |
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$ 22 |
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$ 15 |
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$ 78 |
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$ 80 |
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IT project personnel costs (b) |
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2 |
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2 |
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7 |
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8 |
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Other (c) |
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6 |
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6 |
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26 |
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20 |
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Total |
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$ 30 |
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$ 23 |
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$ 111 |
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$ 108 |
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(a) |
Comprised of third-party consulting fees incurred to assist in the project management and the preliminary project stage of this transformative investment. The company relies on consultants for certain capabilities required for these programs that the company does not maintain internally. These costs support the implementation of these programs incremental to the company's normal IT costs and will not be incurred following implementation. |
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(b) |
Comprised of labor costs associated with internal IT project management teams that are utilized to oversee the new system implementations. Given the magnitude and transformative nature of the implementations planned, the necessary project management costs are incremental to the historical levels of spend and will no longer be incurred subsequent to implementation. As a result of this long-term strategic investment, the company considers these costs not reflective of the ongoing costs to operate its business. |
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(c) |
Comprised of various other expenses associated with the company's new system implementations, including company personnel dedicated to the project that have been backfilled with either permanent or temporary resources in positions that are considered part of normal operating expenses. |
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(4) |
During the twelve months ended |
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(5) |
During the twelve months ended |
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Full year 2026 outlook |
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Diluted earnings per share |
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Low |
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High |
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As estimated (GAAP) |
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$ 5.60 |
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$ 5.95 |
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Digital capabilities and productivity enhancements |
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0.35 |
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0.35 |
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As adjusted (Non-GAAP) |
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$ 5.95 |
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$ 6.30 |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6) |
In fiscal year 2026, the company expects to incur approximately |
The following tables provide reconciliations of adjusted EBIT (non-GAAP) to earnings (losses) before income taxes, the most comparable GAAP measure:
|
Reconciliation of earnings (losses) before income taxes to |
||||||
|
Three months ended |
|
Twelve months ended |
||||
|
|
|
|
|
|
|
|
Earnings (losses) before income taxes |
$ 410 |
|
$ 275 |
|
$ 1,078 |
|
$ 398 |
Interest income |
(2) |
|
(2) |
|
(9) |
|
(23) |
Interest expense |
22 |
|
21 |
|
88 |
|
90 |
Loss on divestiture |
— |
|
— |
|
118 |
|
240 |
Pension settlement charge |
— |
|
— |
|
— |
|
171 |
Cyberattack costs, net of insurance recoveries |
— |
|
(28) |
|
(70) |
|
29 |
Streamlined operating model |
— |
|
19 |
|
— |
|
32 |
Digital capabilities and productivity enhancements investment |
30 |
|
23 |
|
111 |
|
108 |
Adjusted EBIT |
$ 460 |
|
$ 308 |
|
$ 1,316 |
|
$ 1,045 |
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Earnings |
|
|
|
|
|
|
|||
Dollars in millions, except per share data |
|
|
|
|
|
|
|
||
|
|
|
Three months ended |
|
Twelve months ended |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
Net sales |
|
|
$ 1,988 |
|
$ 1,903 |
|
$ 7,104 |
|
$ 7,093 |
Cost of products sold |
|
|
1,064 |
|
1,019 |
|
3,891 |
|
4,045 |
Gross profit |
|
|
924 |
|
884 |
|
3,213 |
|
3,048 |
Selling and administrative expenses |
|
296 |
|
268 |
|
1,124 |
|
1,167 |
|
Advertising costs |
|
|
171 |
|
266 |
|
770 |
|
832 |
Research and development costs |
|
32 |
|
33 |
|
121 |
|
126 |
|
Loss on divestiture |
|
|
— |
|
— |
|
118 |
|
240 |
Pension settlement charge |
|
|
— |
|
— |
|
— |
|
171 |
Interest expense |
|
|
22 |
|
21 |
|
88 |
|
90 |
Other (income) expense, net |
|
(7) |
|
21 |
|
(86) |
|
24 |
|
Earnings before income taxes |
|
410 |
|
275 |
|
1,078 |
|
398 |
|
Income taxes |
|
|
74 |
|
54 |
|
254 |
|
106 |
Net earnings |
336 |
|
221 |
|
824 |
|
292 |
||
Less: Net earnings attributable to noncontrolling interests |
4 |
|
5 |
|
14 |
|
12 |
||
Net earnings attributable to Clorox |
|
$ 332 |
|
$ 216 |
|
$ 810 |
|
$ 280 |
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share attributable to Clorox |
|
|
|
|
|
|
|
|
|
Basic net earnings per share |
|
$ 2.70 |
|
$ 1.74 |
|
$ 6.56 |
|
$ 2.26 |
|
Diluted net earnings per share |
|
$ 2.68 |
|
$ 1.73 |
|
$ 6.52 |
|
$ 2.25 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding (in thousands) |
|
|
|
|
|
|
|
||
Basic |
|
123,173 |
|
124,300 |
|
123,525 |
|
124,174 |
|
Diluted |
|
123,744 |
|
125,052 |
|
124,287 |
|
124,804 |
Reportable Segment Information |
|
|
|
|
|
|
|
|
||||
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
Net sales |
||||||||
|
|
Three months ended |
|
Twelve months ended |
||||||||
|
|
|
|
|
|
% Change(1) |
|
|
|
|
|
% Change(1) |
Health and Wellness |
|
$ 741 |
|
$ 652 |
|
14 % |
|
$ 2,697 |
|
$ 2,485 |
|
9 % |
Household |
|
639 |
|
597 |
|
7 % |
|
2,001 |
|
1,950 |
|
3 % |
Lifestyle |
|
339 |
|
328 |
|
3 % |
|
1,303 |
|
1,275 |
|
2 % |
International |
|
269 |
|
271 |
|
(1) % |
|
1,065 |
|
1,162 |
|
(8) % |
Reportable segment total |
|
$ 1,988 |
|
$ 1,848 |
|
|
|
$ 7,066 |
|
$ 6,872 |
|
|
Corporate and Other (2) |
|
— |
|
55 |
|
(100) % |
|
38 |
|
221 |
|
(83) % |
Total |
|
$ 1,988 |
|
$ 1,903 |
|
4 % |
|
$ 7,104 |
|
$ 7,093 |
|
— % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment adjusted EBIT |
|
Segment adjusted EBIT |
||||||||
|
|
Three months ended |
|
Twelve months ended |
||||||||
|
|
|
|
|
|
% Change(1) |
|
|
|
|
|
% Change(1) |
Health and Wellness |
|
$ 243 |
|
$ 202 |
|
20 % |
|
$ 840 |
|
$ 719 |
|
17 % |
Household |
|
156 |
|
98 |
|
59 % |
|
325 |
|
260 |
|
25 % |
Lifestyle |
|
94 |
|
61 |
|
54 % |
|
290 |
|
253 |
|
15 % |
International |
|
23 |
|
18 |
|
28 % |
|
110 |
|
122 |
|
(10) % |
Reportable segment total |
|
$ 516 |
|
$ 379 |
|
|
|
$ 1,565 |
|
$ 1,354 |
|
|
Corporate and Other (2) |
|
(56) |
|
(71) |
|
|
|
(249) |
|
(309) |
|
|
Interest income |
|
2 |
|
2 |
|
|
|
9 |
|
23 |
|
|
Interest expense |
|
(22) |
|
(21) |
|
|
|
(88) |
|
(90) |
|
|
Loss on divestiture (3) |
|
— |
|
— |
|
|
|
(118) |
|
(240) |
|
|
Pension settlement (4) |
|
— |
|
— |
|
|
|
— |
|
(171) |
|
|
Cyberattack costs, net of insurance recoveries (5) |
|
— |
|
28 |
|
|
|
70 |
|
(29) |
|
|
Streamlined operating model (6) |
|
— |
|
(19) |
|
|
|
— |
|
(32) |
|
|
Digital capabilities and productivity enhancements |
|
(30) |
|
(23) |
|
|
|
(111) |
|
(108) |
|
|
Earnings (losses) before income taxes |
|
$ 410 |
|
$ 275 |
|
49 % |
|
$ 1,078 |
|
$ 398 |
|
171 % |
(1) |
Percentages based on rounded numbers. |
(2) |
Corporate and Other includes the Better Health VMS business. |
(3) |
Represents the loss on divestiture of the Better Health VMS business of |
(4) |
Represents the pension settlement charge of |
(5) |
Represents insurance recoveries related to the cyberattack, net of costs incurred of $28 ( |
(6) |
Represents restructuring and related costs, net for implementation of the streamlined operating model of |
(7) |
Represents expenses related to the company's digital capabilities and productivity enhancements investment of |
Condensed Consolidated Balance Sheets |
|
|
|
|
||||
Dollars in millions |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
(Unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
||
Current assets |
|
|
|
|
|
|
||
|
Cash and cash equivalents |
|
$ |
167 |
|
$ |
202 |
|
|
Receivables, net |
|
|
821 |
|
|
695 |
|
|
Inventories, net |
|
|
523 |
|
|
637 |
|
|
Prepaid expenses and other current assets |
|
|
97 |
|
|
88 |
|
|
|
Total current assets |
|
|
1,608 |
|
|
1,622 |
Property, plant and equipment, net |
|
|
1,267 |
|
|
1,315 |
||
Operating lease right-of-use assets |
|
|
333 |
|
|
360 |
||
|
|
|
1,229 |
|
|
1,228 |
||
Trademarks, net |
|
|
502 |
|
|
538 |
||
Other intangible assets, net |
|
|
64 |
|
|
143 |
||
Other assets |
|
|
558 |
|
|
545 |
||
Total assets |
|
$ |
5,561 |
|
$ |
5,751 |
||
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
||
Current liabilities |
|
|
|
|
|
|
||
|
Notes and loans payable |
|
$ |
4 |
|
$ |
4 |
|
|
Current operating lease liabilities |
|
|
87 |
|
|
84 |
|
|
Accounts payable and accrued liabilities |
|
|
1,828 |
|
|
1,486 |
|
|
|
Total current liabilities |
|
|
1,919 |
|
|
1,574 |
Long-term debt |
|
|
2,484 |
|
|
2,481 |
||
Long-term operating lease liabilities |
|
|
305 |
|
|
334 |
||
Other liabilities |
|
|
351 |
|
|
848 |
||
Deferred income taxes |
|
|
20 |
|
|
22 |
||
|
|
Total liabilities |
|
|
5,079 |
|
|
5,259 |
Commitments and contingencies |
|
|
|
|
|
|
||
Stockholders' equity |
|
|
|
|
|
|
||
Preferred stock |
|
|
— |
|
|
— |
||
Common stock |
|
|
131 |
|
|
131 |
||
Additional paid-in capital |
|
|
1,319 |
|
|
1,288 |
||
Retained earnings |
|
|
432 |
|
|
250 |
||
|
|
|
(1,404) |
|
|
(1,186) |
||
Accumulated other comprehensive net (loss) income |
|
|
(157) |
|
|
(155) |
||
|
|
Total Clorox stockholders' equity |
|
|
321 |
|
|
328 |
Noncontrolling interests |
|
|
161 |
|
|
164 |
||
Total stockholders' equity |
|
|
482 |
|
|
492 |
||
Total liabilities and stockholders' equity |
|
$ |
5,561 |
|
$ |
5,751 |
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