CEO Linda Rendle on Clorox’s Second Quarter FY22 Results

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Society

Clorox President and CEO Linda Rendle shares her perspective on the company’s second quarter results for fiscal 2022.

Our second quarter fiscal 2022 results released today demonstrate the challenging cost environment in which we continue to operate, but they also show that we are executing well on the things we can control: taking strategic pricing action , generate cost savings while restoring supply and advancing our consumer-centric innovation pipeline. Demand remains robust across our portfolio and our brand superiority results are better than at the height of the pandemic.

Net sales in the second quarter fell 8% to $1.7 billion from growth of 27% a year ago, translating to growth of 19% year-over-year. Adjusted EPS decreased 67% to $0.66 due to higher manufacturing, logistics and raw material costs, partially offset by our pricing actions and cost savings.

Although we expect this high cost environment to persist through fiscal 2022 and have adjusted our outlook accordingly, we are confident that we have the right strategy and are taking the right steps to meet successfully meet these challenges and maintain the sales momentum. We remain focused on margin reconstruction and profitable growth, and we continue to make progress on our priorities:

  • We increased market share across the majority of our businesses, including a second consecutive quarter of double-digit increases in disinfectant wipes market share, driven by strong demand building plans and continued progress in catering supply across our portfolio.
  • Our brands are stronger today than at the height of the pandemic. In fact, 75% of our brands have superior value as measured by our record-breaking consumer value indicator. In addition, household penetration remains very strong for our brands.
  • To mitigate rising costs, we are taking several steps:
    • We have accelerated pricing on the vast majority of our portfolio, including several series on select brands. We are well positioned to execute additional pricing in our portfolio due to the strength of our brands, supported by our record consumer value indicator.
    • We are optimizing our supply chain by working to remove many of the costs that were incurred as we increased supply chain resilience during the pandemic.
    • We have expanded the funnel of cost savings opportunities under our IGNITE strategy and are on track to deliver another year of strong cost savings.
  • We continued to advance our multi-year innovation pipeline and launched three new innovations during the quarter that support consumer well-being and the company’s ESG commitments: Clorox® Disinfectant Mists with Reusable Sprayer and Refills, Clorox® All-Purpose Cleaner in a concentrated form with a refillable container. , and Glad® ForceFlexPlus Trash Bags in Cherry Blossom scent.

In short, the fundamentals of our business are solid. Our portfolio is exposed to demand-driven tailwinds, including increased consumer focus on health and wellness, home prioritization, digital adoption and rising pet ownership . We anticipate that all of this will create long-term opportunities for our business.

In addition, we continue to invest for the long term while respecting our ESG commitments. This includes accelerating our digital transformation, which will strengthen our core capabilities in supply chain, digital commerce, innovation and brand building. I am confident that the execution of our IGNITE strategy, coupled with the actions we are taking, will strengthen our competitive position, build a stronger and more resilient business, and drive long-term shareholder value.

Finally, I want to thank my Clorox teammates around the world for their continued resilience and dedication to living our purpose and serving our consumers, customers and communities through this pandemic, every day.

Society

results, financial performance

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