09 Earnings Call Transcript
Good day, ladies and gentlemen,[url=http://www.cheapoakley--sunglasses@#$%&/]oakley safety glasses[/url], and welcome to The Clorox Company first quarter fiscal year 2010 earnings release conference call conference call. ( Instructions) I would now like to introduce your host for today's conference call, Mr. Steve Austenfeld, Vice President of Investor Relations for The Clorox Company. Mr. Austenfeld, you may begin your conference.Great, thank you. Welcome, everyone and thank you for joining Clorox's first quarter conference call. On the call with me today are Don Knauss, Clorox's Chairman and CEO; Larry Peiros,[url=http://www.asicso@#$%&/]asics cumulus[/url], Executive Vice President and Chief Operating Officer of Clorox North America; and Dan Heinrich,[url=http://www.canadagoosejacketsoutlet.ca/]@#$%& jackets[/url], our Chief Financial Officer.On today's call, Larry will start with comments on business unit performance as well as a perspective on the current commodity and retail environment. Dan will then follow with a review of the quarter's financial performance as well as comment on updated fiscal year 2010 outlook, as communicated in our press release this morning. Finally, Don will close with a perspective on key initiatives driving overall company performance and after that, we will open it up for your questions.Let me remind you that on today's we will refer to certain non GAAP financial measures including but not limited to free cash flow,[url=http://www.insanityworkouts-calendar@#$%&/]insanity workout schedule[/url], EBIT margin, and debt to EBITDA. Management believes that providing insights on these measures enables investors to better understand and analyze our ongoing results of operations. Reconciliation with the most directly comparable financial measures determined in accordance with GAAP can be found in today's press release, this webcast prepared remarks,[url=http://www.valentino-outlet.us/]valentino[/url], or supplemental information available in the financial results section of our website as well as in our filings with the SEC. In particular,[url=http://www.ghd-hairstraighteners.co.uk/]ghds[/url], it may be helpful to refer to tables located at the end of today's earnings release.Lastly,[url=http://www.abercrombie-hollister.it/]abercrombie and fitch[/url], please recognize that today's discussion contains forward looking statements. Actual results could differ materially from management's expectations. Please review our most recent 10 K filing with the SEC and our other SEC filings for a description of important factors that could cause results to differ materially from management's expectations.With that, let me turn over to Larry.Thanks, Steve and good morning to all of you on the call. As you saw in our press release, we had a very good quarter. We delivered solid sales and volume results on top of double digit growth in the year ago quarter and our earnings were up 23% as a result of our third consecutive quarter of gross margin expansion. Very strong results in what remains a very challenging economic environment.As usual, I am going to focus my comments on market share, volume,[url=http://www.oakleysunglasses-outletcheap@#$%&/]fake oakley sunglasses[/url], and sales and provide perspective on what drove our top line results. categories, consumption remains stable. track channels was about flat for Q1, a similar trend to what we have seen for the last several quarters. Our sales growth in untracked channels continues to significantly outpace sales in tracked channels with consumers migrating to value oriented retailers like Club and Dollar. share was down slightly in the quarter, primarily due to competitive activity in a few key categories and the growth of private label shares. For perspective, on an all outlet basis,[url=http://www.supra--shoes@#$%&/]supra footwear[/url], we grew our overall market share nearly a full share point during the past 52 week period.In our international businesses,[url=http://www.michael-kors-outlet-online.us@#$%&/]michael kors coupons[/url], our market share results are positive and we generally have seen stronger category growth than anticipated,[url=http://www.michaelkorshandbags-uk.co.uk/]michael kors watch[/url], driven by pricing. Our volume was up 1% for the quarter. Gains were primarily due to higher shipments of disinfecting products due to the H1N1 flu pandemic, largely offset by lower shipments of Glad trash bags and our exit from the private label food bags business. The upside related to the H1N1 flu was well above our forecast given the rapid spread of the virus.Sales for the quarter were down about 1%. Without the negative impact of foreign exchange,[url=http://www.@#$%&-all-star.it/]@#$%& all star sito ufficiale[/url], we would have seen sales growth. This year's results are up against a very strong 12% sales growth in the year ago quarter, which was driven by healthy base business growth as well as the Burt's Bees acquisition.Most of our businesses performed well in the quarter but as usual, we saw some differences across the portfolio. Here are a few highlights by business.In our largest category homecare, we held share and maintained our leadership share position. Volume and sales were up due to strong growth on disinfecting products. Clorox disinfecting wipes benefited the most with all time record shipments. Volume was also up strongly in some of our base businesses like Pinesol Cleaner and Clorox toilet bowl cleaners. The positives in home care more than offset some volume losses on Green Works hard surface cleaners. The growth in the natural cleaning category has slowed as we lap our initial launch, although natural cleaners are still growing faster than traditional cleaners.Overall our core five Green Works cleaning products grew share within the natural homecare segment and we remain the number one player with a 45% share, about twice the size of the nearest competitor.In food, we continue to win in the salad dressing category, holding share despite a very competitive marketplace. Even with a significant premium to the competition, Hidden Valley salad dressings delivered double digit volume and sales results, propelled by highly effective marketing and a great tasting product.In international, which now includes Canada,[url=http://www.marcjacobshandbags.in.net/]marc jacobs daisy[/url], volume was up about 3% with growth primarily driven by disinfecting products in Latin America. Despite unfavorable foreign exchange rate, sales were up 4% due to price increases. On a constant currency basis,[url=http://www.sacvanessabruno.fr/]sac vanessa bruno en solde[/url], our sales grew 12%.Overall, our categories in international markets are healthy. We grew share in a number of markets, notably dilutable cleaners in bleach and Latin America. Overall dollar share in Latin America increased about 2.5 points for the quarter.In Glad,[url=http://www.instylerionicstyler.us@#$%&/]instyler curling iron[/url], Q1 volume and sales were down due to a weak category and increased competitive activity. The category softness relates to significant category volume declines,[url=http://www.nikeairhuarache.co.uk/]huaraches[/url], as well as lost sales dollars due to price rollbacks and increased trade spending category wide.Also affecting Glad's top line was our decision to exit from private label food bag the last fiscal year. That decision alone accounted for about a third of the Glad volume decline.Glad remains our most dynamic and challenging business, given the ebb and flow of resin costs,[url=http://www.nikeblazer-pascher.fr/]blazer @#$%&[/url], retail pricing,[url=http://www.borse-gucci.it/]borse gucci[/url], and competitive activity. We are working to restore Glad top line growth through innovation and demand building investment. In August,[url=http://www.new--balance.fr/]new balance femme[/url], we began shipping a new Glad force flex trash bag that grips the top of the trash can and stays in place. We are offering this improvement to consumers without a price increase,[url=http://www.hermesbirkin-bags.us@#$%&/]hermes birkin bag[/url], a great example of how we are focused on driving greater value. We are also continuing to invest heavily in Glad advertising and trade promotion spending, including strong value oriented message.Turning to laundry, the competitive dynamics and laundry additives has greatly intensified since last quarter, both from established players as well as new entries. We are vigorously defending this business, including marketing initiatives focused on the message that detergent alone is not enough and highlighting the benefits of Clorox 2 on stains.Despite the new competitive activity,[url=http://www.lunetteoakley-pascher.fr/]lunette oakley[/url], both volume and sales were up in the quarter. Our share was down, however, with the overall category expanding significantly behind the heightened activity.Also in laundry,[url=http://www.uggaustraliaonsale.us@#$%&/]uggs sandals[/url], we started shipping Green Works natural laundry detergent and stain remover in July. The products are off to a slower start than we had anticipated. That said, it's still very early. We are working through the challenges of being a premium priced offering in a highly competitive price sensitive category. We continue to support the launch through advertising and introductory marketing.The Brita brand is fundamentally healthy and continues to benefit from the sustainability mega trend and consumers' focus on value given the significant savings Brita provides versus bottled water.Q1 volume and sales has climbed modestly,[url=http://www.redbottomshoes.in.net/]christian louboutin shoes on sale[/url], primarily due to the comparison with strong growth in the year ago quarter. However, we grew share and [inaudible] trash remains one of our fastest growing categories.On Burt's Bees, volume and sales were down slightly compared to strong 17% shipment growth on the brand in the year ago quarter. While Burt's Bees has been impacted by the current economic conditions, we remain confident about the fundamentals of this business and the long term prospects. Consumption growth in our line of natural products has stabilized at high single digit growth over the last several quarters. While this is less than the double digit growth we saw prior to the recession,[url=http://www.herveleger.in.net/]herve leger[/url], it is much stronger growth than what we are seeing in the traditional personal care category.We continue to anticipate solid sales growth on this business in fiscal 2010 and we are laying a strong foundation for a more robust growth as the economic conditions improve. For example,[url=http://www.saclongchamp-pas-cher.fr/]sac longchamps[/url], when we acquired Burt's Bees, the business had a significant presence in three countries. Currently Burt's is in 14 countries and we plan to be in more than 20 countries by the end of this fiscal year.

[url=http://forum.ragnaroksaga@#$%&/showthread.php?16841-p90x-ab-ripper-x-3-men-removed-backpack-from-Boston-suspect&p=18441#post18441]3 men removed backpack from Boston suspect[/url]

[url=http://www.dailyqr@#$%&/blog_entry.php?user=941707&blogentry_id=16999940]sac hermes 'Good times never seemed so good'[/url]

[url=http://uchem.berkeley.edu/forum/read.php?18,1493558]sac longchamps 5 Shocking Side Effects of Foods You Eat Every Day[/url]

[url=http://www.dailyqr@#$%&/blog_entry.php?user=942259&blogentry_id=16999934]@#$%& polo Adventure in Paradise Full Movie[/url]

[url=http://www.anticoagulation.org.uk/forum/read.php?2,701540]babyliss pro nano titanium 8 design trends for 2014[/url]