Church & Dwight reports strong quarterly results
Sales for the period grew by 8.7 percent to $594.0m, whereas organic sales grew by 8 percent, reflecting the positive effect of a weaker dollar against foreign currencies and a strong product mix.
The effects of increasing raw materials, logistic and energy costs were also counterbalanced by increases in retail prices, which helped drive the bottom line.
Those increases in retail prices were implemented in the first quarter of the year and affected approximately 30 percent of the company’s product portfolio across the board.
Profits help curb debt
This led net income to increase by 12.9 percent, from $40.53m to $45.76m, which meant that at the end of the quarter the company had total debts of $484m.
On the sales side the results were driven by a stronger performance from its international sales as well as those for its household products, thanks mainly to a rash of new product launches during the period.
Of the total domestic sales, the group's personal care division, which is renowned for its Arm & Hammer oral care products, accounted for approximately 35 percent of the sales.
Household overshadows personal care
The performance of the division was overshadowed by the household products, with sales growth for the personal care segment increasing by 5 percent to $145m, compared to a 9 percent increase to $266m for household.
But the biggest increase in sales was in the company’s international markets, where the figure grew 11 percent to reach $112m, of which 8 percent of the increase was accounted for by favorable exchange rates.
CEO James Craigie said of the performance: “These results reflect strong organic revenue growth and improved gross margins. Our organic revenue growth was primarily driven by pricing actions, new products, marketing spending and new distribution on existing products.”
Craigie added that as a result of the strong performance he expects organic revenues for the full financial year to exceed the 3 -4 percent goal contained in its long-term market projections.
The company also announced that it had completed the deal to buy the Del Pharmaceuticals from fragrance provider Coty, which includes the over-the-counter oral analgesic brand Orajel – a deal that is expected to have a neutral effect on earnings in 2008.