Volume growth in the segment was driven by another quarter of double-digit increases in the Burt's Bees business, reflecting new innovation in lip care products. The Food business also delivered volume growth primarily from higher shipments of Hidden Valley® products behind strong base business growth and the launch of new sandwich spreads. Volume declined in the Water Filtration business compared to strong volume in the year-ago quarter behind the launch of the Brita Bottle®, increased competitive activity and the impact of price increases. Segment sales outpaced volume primarily due to the benefit of price increases. Pretax earnings decline primarily reflected higher advertising and sales promotion spending to support new products.
(All countries outside of the U.S.)
•1% volume increase •2% sales increase •5% pretax earnings decrease
Volume increased primarily due to higher shipments in Asia and certain regions in Latin America, partially offset by the company's exit from nonstrategic export businesses. Overall segment sales increased primarily due to the benefit of price increases and lower trade-promotion spending, partially offset by the impact of unfavorable currency exchange rates. Pre-tax earnings declined due to significant inflation affecting manufacturing and logistics costs and the impact of declining foreign currencies and price controls in Argentina and Venezuela. These factors were partially offset by a decrease in advertising and sales promotion and lower selling and administrative expenses primarily due to reduced spending for the company's IT systems implementation in Latin America.
Clorox Updates Fiscal 2013 Sales Outlook
•3-4 percent sales growth (previously 3-5 percent) •EBIT margin up 25-50 basis points (unchanged) •Diluted EPS in the range of $4.25-$4.35 (unchanged)
Clorox now anticipates year-over-year sales growth for fiscal 2013 in the range of 3 percent to 4 percent, but likely toward the lower end of the range. This includes a negative impact of about half a percentage point from lower charcoal sales due to significant category declines related to unfavorable weather conditions. In addition, the range reflects strong results in the first half of the fiscal year and a more challenging comparison to strong sales growth of nearly 6 percent in the second half of fiscal 2012. The sales outlook also reflects the impact of declining foreign currencies and continued economic uncertainty in Argentina and Venezuela.
The company continues to expect earnings from continuing operations before interest and taxes (EBIT) margin to increase 25-50 basis points for the fiscal year, reflecting strong cost savings and the benefit of price increases. Commodity costs are estimated to be about flat versus the prior fiscal year. The outlook also reflects a continued increase in advertising and sales promotion investments and a higher tax rate in the fourth quarter versus the same period in fiscal 2012.
Net of all these factors, Clorox continues to anticipate fiscal 2013 diluted EPS from continuing operations in the range of $4.25 to $4.35.
Clorox Provides Initial Fiscal 2014 Financial Outlook
•2-4 percent sales growth •EBIT margin up 25-50 basis points •Diluted EPS in the range of $4.55-$4.70
Clorox anticipates sales growth for fiscal 2014 in the range of 2 percent to 4 percent, which reflects a negative impact of 1 percentage point from foreign currency declines in Argentina and other countries. The company's sales outlook also reflects continued product innovation and demand-building programs across the company's brands.
Most Popular Stories
- NSA Defends Global Cellphone Tracking Legality
- Ad Counts Rise in 2013 for Hispanic Magazines
- Top Websites for U.S. Hispanics
- Networks Vie for U.S. Hispanic TV Viewers
- Saab Gets Back into the Game; U.S. Auto Sales Soar
- Apple Activates Customer-Tracking iBeacon
- Dell Offers Undisclosed Number of Employee Buyouts
- Authorities Close to Deal with JPMorgan Chase over Madoff Response
- 2013 Tech Gift Guide: iPad Mini Still Hot; Chromecast a Great Low-Cost Option
- A Biography of Jonathan Ive, Apple's Creative Chief