Natural personal care proves to be good business for Clorox

By Deanna Utroske

- Last updated on GMT

Natural personal care proves to be good business for Clorox

Related tags Clorox

The Clorox Company announced Q1 2018 financial results this week and it’s clear that the Burt’s Bees personal care and cosmetics brand is doing well for the company, despite its being the only beauty brand in the Clorox portfolio.

The word from the top is positive; Benno Dorer, chairman and CEO of Clorox, tells the press, “I'm very pleased with our strong start to the fiscal year. We delivered sales and earnings growth on top of very good results in the year-ago quarter. Broad-based strength in our business from strong execution of our 2020 Strategy led to sales increases and gross margin expansion across all of our segments.”

And his view of the full-company’s future is optimistic too: “We continue to feel good about our ability to deliver another year of sales and earnings growth,” says Dorer in a press release about The Clorox Company’s current financials.

He goes on to acknowledge that “While we're facing additional cost pressures related to the recent hurricanes, we believe the strength of our business will help us mitigate about half of these short-term impacts. We continue to be confident in our 2020 Strategy, with the priority to deliver superior value to consumers behind strong investments in our differentiated products and brands.”

Q1 results

Year-over-year Clorox Q1 sales were up 4%. The company reports net cash from continuing operations for the quarter, which ended September 30, 2017, at $257m. That’s in contrast to $170m in the same quarter a year ago.

The company’s press release explains this year’s figure saying it’s “reflecting lower employee incentive compensation payments and higher earnings in the first quarter of fiscal year 2018.”

Earnings for the quarter came in at $192m (or $1.46 as diluted earnings per share).  The 4% sales lift is credited as the main driver of earnings for the quarter.

Burt’s Bees

The Burt’s Bees brand lives in the lifestyle segment at Clorox. That segment also comprises the company’s dressings and sauces brands as well as water filtration products.

For Q1 the lifestyle segment saw a 4% growth in sales and a 3% pretax earnings growth. And the company’s only beauty brand gets much of the credit: “Segment sales growth was driven primarily by double-digit volume gains in the Burt's Bees Natural Personal Care business, reflecting the launch of natural cosmetics as well as expanded club channel distribution of lip care products.”

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