Workflow
Clorox Reports Q4 and FY24 Results, Provides FY25 Outlook
CLXClorox(CLX) Prnewswire·2024-08-01 20:10

Core Insights - The Clorox Company announced the divestiture of its Better Health Vitamins, Minerals and Supplements (VMS) business to Piping Rock Health Products, LLC, as part of its IGNITE strategy to evolve its portfolio for consistent, profitable growth [1][12][13]. Fourth-Quarter Fiscal Year 2024 Summary - Net sales decreased by 6% to 1.9billioncomparedtothesamequarterlastyear,primarilyduetotheArgentinadivestiture,unfavorablepricemix,andlowervolume[3][11].−Grossmarginincreasedby380basispointsto46.51.9 billion compared to the same quarter last year, primarily due to the Argentina divestiture, unfavorable price mix, and lower volume [3][11]. - Gross margin increased by 380 basis points to 46.5%, attributed to lower manufacturing and logistics costs, cost savings initiatives, and favorable commodity costs [3]. - Diluted EPS rose by 22% to 1.73, including insurance recoveries related to a cyberattack, while adjusted EPS increased by 9% to 1.82[3][11].StrategicandOperationalHighlights−Thecompanysuccessfullyrestoreddistributionlossesandregainedmarketsharelostduetoacyberattack,whilecontinuingtoinvestinbrandvaluethroughadvertisingandinnovations[5].−Cloroxachieveditsseventhconsecutivequarterofgrossmarginexpansionandcompletedtheimplementationofastreamlinedoperatingmodel,expectedtoyieldannualcostsavingsofapproximately1.82 [3][11]. Strategic and Operational Highlights - The company successfully restored distribution losses and regained market share lost due to a cyberattack, while continuing to invest in brand value through advertising and innovations [5]. - Clorox achieved its seventh consecutive quarter of gross margin expansion and completed the implementation of a streamlined operating model, expected to yield annual cost savings of approximately 100 million [5][33]. - The company received multiple recognitions for its workplace and environmental initiatives, including being named a Best Company to Work For by U.S. News & World Report [5]. Key Segment Results - Health and Wellness segment net sales were flat, with cleaning sales increasing due to restored distribution and new innovations [6]. - Household segment net sales decreased by 10%, driven by lower volume and unfavorable price mix, while adjusted EBIT decreased by 31% [7]. - Lifestyle segment net sales decreased by 2%, with food sales increasing due to strong consumption, but water filtration and natural personal care sales declined [8]. - International segment net sales decreased by 11%, primarily due to the Argentina divestiture, but organic sales increased by 5% when excluding Argentina [9]. Fiscal Year 2024 Summary - For the fiscal year, net sales decreased by 4%, with gross margin increasing by 360 basis points to 43.0% [11]. - Diluted EPS increased by 88% to 2.25,whileadjustedEPSroseby212.25, while adjusted EPS rose by 21% to 6.17, driven by pricing and gross margin expansion [11]. Expected Divestiture of Better Health VMS Business - The Better Health VMS business represented approximately 3% of the company's fiscal year 2024 net sales, and the divestiture is expected to incur a one-time after-tax charge of 114millionto114 million to 134 million [12][13][23]. - The transaction is anticipated to close in the first quarter of fiscal year 2025, subject to regulatory approvals [12][13]. Fiscal Year 2025 Outlook - Net sales are expected to be flat to down 2%, with organic sales projected to increase by 3% to 5% [15]. - Gross margin is anticipated to improve by about 100 basis points, while diluted EPS is expected to range between 4.95and4.95 and 5.20, reflecting a significant increase [15][42].