Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~October~~July 26, ~~2022,~~2023, there were ~~243,868,347~~246,046,990 shares of Common Stock outstanding.


Item		Page		Page
1.	Financial Statements	3	Financial Statements	3

2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

3.	Quantitative and Qualitative Disclosures about Market Risk	33	Quantitative and Qualitative Disclosures about Market Risk	29

4.	Controls and Procedures	33	Controls and Procedures	29


1.	Legal Proceedings	35	Legal Proceedings	30

1A.	Risk Factors	35	Risk Factors	31

2.	Unregistered Sales of Equity Securities and Use of Proceeds	36	Unregistered Sales of Equity Securities and Use of Proceeds	31

5.			Other Information	31

6.	Exhibits	37	Exhibits	32


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30,			September 30,			September 30,			September 30,			June 30,			June 30,			June 30,			June 30,
	2022			2021			2022			2021			2023			2022			2023			2022
Net Sales	$	1,317.3		$	1,311.4		$	3,939.6		$	3,821.4		$	1,454.2		$	1,325.1		$	2,884.0		$	2,622.3
Cost of sales		767.6			732.2			2,292.1			2,139.1			815.3			779.8			1,623.1			1,524.5
Gross Profit		549.7			579.2			1,647.5			1,682.3			638.9			545.3			1,260.9			1,097.8
Marketing expenses		140.7			160.9			345.5			376.6			132.2			102.9			254.5			204.8
Selling, general and administrative expenses		155.1			116.9			505.8			403.0			213.1			180.8			420.9			350.7
Income from Operations		253.9			301.4			796.2			902.7			293.6			261.6			585.5			542.3
Equity in earnings of affiliates		3.7			2.0			10.0			7.4			2.0			3.9			6.4			6.3
Investment earnings, net		1.5			0.0			1.8			0.1
Other income (expense), net		(0.9	)		(0.7	)		(1.2	)		(1.1	)		1.7			0.3			3.0		0.0
Interest expense		(23.7	)		(13.4	)		(59.6	)		(41.5	)		(27.9	)		(19.3	)		(56.7	)		(35.9	)
Income before Income Taxes		234.5			289.3			747.2			867.6			269.4			246.5			538.2			512.7
Income taxes		47.4			58.9			168.6			198.2			48.2			59.4			113.8			121.2
Net Income	$	187.1		$	230.4		$	578.6		$	669.4		$	221.2		$	187.1		$	424.4		$	391.5

Weighted average shares outstanding - Basic		242.8			245.3			242.7			245.2			245.0			242.6			244.4			242.6
Weighted average shares outstanding - Diluted		246.0			249.8			246.4			249.9			247.9			246.4			247.4			246.5
Net income per share - Basic	$	0.77		$	0.94		$	2.38		$	2.73		$	0.90		$	0.77		$	1.74		$	1.61
Net income per share - Diluted	$	0.76		$	0.92		$	2.35		$	2.68		$	0.89		$	0.76		$	1.72		$	1.59
Cash dividends per share	$	0.26		$	0.25		$	0.79		$	0.76		$	0.27		$	0.26		$	0.54		$	0.53


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30,			September 30,			September 30,			September 30,			June 30,			June 30,			June 30,			June 30,
	2022			2021			2022			2021			2023			2022			2023			2022
Net Income	$	187.1		$	230.4		$	578.6		$	669.4		$	221.2		$	187.1		$	424.4		$	391.5
Other comprehensive income, net of tax:
Foreign exchange translation adjustments		(13.3	)		(5.1	)		(27.8	)		(4.7	)		3.3			(12.3	)		5.7			(14.5	)
Defined benefit plan adjustments gain (loss)	0.0			0.0				1.9			(0.7	)
Defined benefit plan adjustments gain														0.0			0.0			1.5			1.9
Income (loss) from derivative agreements		14.3			10.0			48.0			22.1			(4.9	)		18.4			(5.7	)		33.7
Other comprehensive income (loss)		1.0			4.9			22.1			16.7
Other comprehensive (loss) income														(1.6	)		6.1			1.5			21.1
Comprehensive income	$	188.1		$	235.3		$	600.7		$	686.1		$	219.6		$	193.2		$	425.9		$	412.6


	September 30,			December 31,			June 30,			December 31,
	2022			2021			2023			2022
Assets
Current Assets
Cash and cash equivalents	$	437.6		$	240.6		$	396.9		$	270.3
Accounts receivable, less allowances of $4.0 and $5.5		391.3			405.5
Accounts receivable, less allowances of $3.5 and $3.5								460.9			422.0
Inventories		675.3			535.4			675.4			646.6
Other current assets		60.2			51.9			43.2			57.0
Total Current Assets		1,564.4			1,233.4			1,576.4			1,395.9

Property, Plant and Equipment, Net		716.3			652.7			802.4			761.1
Equity Investment in Affiliates		11.9			9.1			14.7			12.7
Trade Names and Other Intangibles, Net		3,404.1			3,494.3			3,369.8			3,431.6
Goodwill		2,270.7			2,274.5			2,430.3			2,426.8
Other Assets		320.4			332.5			317.4			317.5
Total Assets	$	8,287.8		$	7,996.5		$	8,511.0		$	8,345.6

Liabilities and Stockholders' Equity
Current Liabilities
Short-term borrowings	$	3.3		$	252.8		$	4.0		$	74.0
Current portion of long-term debt		400.0			699.4
Accounts payable and accrued expenses		1,032.0			1,119.7
Accounts payable								677.7			666.7
Accrued expenses and other liabilities								432.4			436.1
Income taxes payable		15.3			3.3			7.7			7.0
Total Current Liabilities		1,450.6			2,075.2			1,121.8			1,183.8

Long-term Debt		2,104.4			1,610.7			2,400.9			2,599.5
Deferred Income Taxes		738.9			745.1			754.0			757.0
Deferred and Other Long-term Liabilities		272.1			298.3			281.3			273.4
Business Acquisition Liabilities		34.0			34.0			42.0			42.0
Total Liabilities		4,600.0			4,763.3			4,600.0			4,855.7

Commitments and Contingencies
Stockholders' Equity
Preferred Stock, $1.00 par value, Authorized 2,500,000 shares; none issued		0.0			0.0			0.0			0.0
Common Stock, $1.00 par value, Authorized 600,000,000 shares and 292,855,100 shares issued as of September 30, 2022 and December 31, 2021		292.8			292.8
Common Stock, $1.00 par value, Authorized 600,000,000 shares and 293,709,982 shares issued as of June 30, 2023 and December 31, 2022								293.7			293.7
Additional paid-in capital		355.9			310.3			422.6			366.2
Retained earnings		5,753.4			5,366.0			5,815.3			5,524.6
Accumulated other comprehensive loss		(46.1	)		(68.2	)		(27.8	)		(29.3	)
Common stock in treasury, at cost: 49,896,366 shares as of September 30, 2022 and 50,309,124 shares as of December 31, 2021		(2,668.2	)		(2,667.7	)
Common stock in treasury, at cost: 47,710,884 shares as of June 30, 2023 and 49,814,106 shares as of December 31, 2022								(2,592.8	)		(2,665.3	)
Total Stockholders' Equity		3,687.8			3,233.2			3,911.0			3,489.9
Total Liabilities and Stockholders' Equity	$	8,287.8		$	7,996.5		$	8,511.0		$	8,345.6


	Nine Months Ended						Six Months Ended
	September 30,			September 30,			June 30,			June 30,
	2022			2021			2023			2022
Cash Flow From Operating Activities
Net Income	$	578.6		$	669.4		$	424.4		$	391.5
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense		50.1			51.3			34.6			33.4
Amortization expense		110.5			113.6			76.1			73.9
Change in fair value of business acquisition liabilities		0.0			(98.0	)
Deferred income taxes		(12.7	)		32.8			(1.9	)		2.4
Equity in net earnings of affiliates		(10.0	)		(7.4	)		(6.4	)		(6.3	)
Distributions from unconsolidated affiliates		7.2			7.5			4.4			3.2
Non-cash compensation expense		22.0			20.3			39.5			17.9
Other		(1.5	)		5.8			0.2			(3.3	)
Change in assets and liabilities:
Accounts receivable		(1.7	)		(12.0	)		(32.4	)		(7.5	)
Inventories		(152.7	)		(59.9	)		(24.3	)		(133.0	)
Other current assets		4.7			6.1			8.8			10.0
Accounts payable and accrued expenses		(56.0	)		(50.8	)
Accounts payable, accrued and other liabilities								(17.1	)		(62.1	)
Income taxes payable		16.5			(10.3	)		6.6			2.0
Other operating assets and liabilities, net		(20.9	)		(14.8	)		(3.3	)		(11.7	)
Net Cash Provided By Operating Activities		534.1			653.6			509.2			310.4
Cash Flow From Investing Activities
Additions to property, plant and equipment		(98.1	)		(64.1	)		(63.2	)		(38.8	)
Other		(2.6	)		(5.6	)		(6.0	)		(1.0	)
Net Cash Used In Investing Activities		(100.7	)		(69.7	)		(69.2	)		(39.8	)
Cash Flow From Financing Activities
Long-term debt borrowings		499.8			0.0			0.0			499.8
Long-term debt (repayments)		(300.0	)		(300.0	)		(200.0	)		0.0
Short-term debt (repayments), net of borrowings		(249.5	)		(71.6	)		(70.6	)		(249.5	)
Proceeds from stock options exercised		22.4			26.9			88.3			16.9
Payment of cash dividends		(191.2	)		(185.8	)		(133.0	)		(127.4	)
Purchase of treasury stock		0.0			(54.9	)
Deferred financing and other		(7.5	)		0.0			(0.1	)		(7.6	)
Net Cash Provided By (Used In) Financing Activities		(226.0	)		(585.4	)		(315.4	)		132.2
Effect of exchange rate changes on cash and cash equivalents		(10.4	)		(1.6	)		2.0			(3.7	)
Net Change In Cash and Cash Equivalents		197.0			(3.1	)		126.6			399.1
Cash and Cash Equivalents at Beginning of Period		240.6			183.1			270.3			240.6
Cash and Cash Equivalents at End of Period	$	437.6		$	180.0		$	396.9		$	639.7


	Nine Months Ended				Six Months Ended
	September 30,		September 30,		June 30,		June 30,
	2022		2021		2023		2022
Cash paid during the period for:
Interest (net of amounts capitalized)	$	54.0	$	45.4	$	57.9	$	32.4
Income taxes	$	165.5	$	175.7	$	109.2	$	117.6
Supplemental disclosure of non-cash investing activities:
Property, plant and equipment expenditures included in Accounts Payable	$	34.4	$	11.2	$	25.4	$	17.5


	Number of Shares					Amounts																Number of Shares					Amounts
	Common Stock		Treasury Stock			Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Stockholders' Equity			Common Stock		Treasury Stock			Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Stockholders' Equity
December 31, 2020		292.8		(47.4	)	$	292.8	$	274.4	$	4,786.0		$	(77.6	)	$	(2,255.2	)	$	3,020.4
December 31, 2021																							292.8		(50.3	)	$	292.8	$	310.3	$	5,366.0		$	(68.2	)	$	(2,667.7	)	$	3,233.2
Net income		0.0		0.0			0.0		0.0		220.7			0.0			0.0			220.7			0.0		0.0			0.0		0.0		204.4			0.0			0.0			204.4
Other comprehensive income (loss)		0.0		0.0			0.0		0.0		0.0			23.0			0.0			23.0			0.0		0.0			0.0		0.0		0.0			15.0			0.0			15.0
Cash dividends		0.0		0.0			0.0		0.0		(61.9	)		0.0			0.0			(61.9	)		0.0		0.0			0.0		0.0		(63.7	)		0.0			0.0			(63.7	)
Stock purchases		0.0		(0.4	)		0.0		30.0		0.0			0.0			(30.0	)		0.0			0.0		(0.2	)		0.0		20.0		0.0			0.0			(20.0	)		0.0
Stock based compensation expense and stock option plan transactions		0.0		0.1			0.0		1.8		0.0			0.0			7.2			9.0			0.0		0.3			0.0		3.9		0.0			0.0			10.1			14.0
March 31, 2021		292.8		(47.7	)	$	292.8	$	306.2	$	4,944.8		$	(54.6	)	$	(2,278.0	)	$	3,211.2
March 31, 2022																							292.8		(50.2	)	$	292.8	$	334.2	$	5,506.7		$	(53.2	)	$	(2,677.6	)	$	3,402.9
Net income		0.0		0.0			0.0		0.0		218.3			0.0			0.0			218.3			0.0		0.0			0.0		0.0		187.1			0.0			0.0			187.1
Other comprehensive income (loss)		0.0		0.0			0.0		0.0		0.0			(11.2	)		0.0			(11.2	)		0.0		0.0			0.0		0.0		0.0			6.1			0.0			6.1
Cash dividends		0.0		0.0			0.0		0.0		(61.9	)		0.0			0.0			(61.9	)		0.0		0.0			0.0		0.0		(63.7	)		0.0			0.0			(63.7	)
Stock based compensation expense and stock option plan transactions		0.0		0.2			0.0		14.3		0.0			0.0			6.5			20.8			0.0		0.2			0.0		15.9		0.0			0.0			6.1			22.0
June 30, 2021		292.8		(47.5	)	$	292.8	$	320.5	$	5,101.2		$	(65.8	)	$	(2,271.5	)	$	3,377.2
June 30, 2022																							292.8		(50.0	)	$	292.8	$	350.1	$	5,630.1		$	(47.1	)	$	(2,671.5	)	$	3,554.4

																						Number of Shares					Amounts
																						Common Stock		Treasury Stock			Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Stockholders' Equity
December 31, 2022																							293.7		(49.8	)	$	293.7	$	366.2	$	5,524.6		$	(29.3	)	$	(2,665.3	)	$	3,489.9
Net income		0.0		0.0			0.0		0.0		230.4			0.0			0.0			230.4			0.0		0.0			0.0		0.0		203.2			0.0			0.0			203.2
Other comprehensive income (loss)		0.0		0.0			0.0		0.0		0.0			4.9			0.0			4.9			0.0		0.0			0.0		0.0		0.0			3.1			0.0			3.1
Cash dividends		0.0		0.0			0.0		0.0		(62.0	)		0.0			0.0			(62.0	)		0.0		0.0			0.0		0.0		(66.3	)		0.0			0.0			(66.3	)
Stock purchases		0.0		(0.7	)		0.0		0.0		0.0			0.0			(54.9	)		(54.9	)
Stock based compensation expense and stock option plan transactions		0.0		0.3			0.0		7.4		0.0			0.0			10.6			18.0			0.0		0.3			0.0		27.8		(0.3	)		0.0			10.3			37.8
September 30, 2021		292.8		(47.9	)	$	292.8	$	327.9	$	5,269.6		$	(60.9	)	$	(2,315.8	)	$	3,513.6
March 31, 2023																							293.7		(49.5	)	$	293.7	$	394.0	$	5,661.2		$	(26.2	)	$	(2,655.0	)	$	3,667.7
Net income																							0.0		0.0			0.0		0.0		221.2			0.0			0.0			221.2
Other comprehensive income (loss)																							0.0		0.0			0.0		0.0		0.0			(1.6	)		0.0			(1.6	)
Cash dividends																							0.0		0.0			0.0		0.0		(66.7	)		0.0			0.0			(66.7	)
Stock based compensation expense and stock option plan transactions																							0.0		1.8			0.0		28.6		(0.4	)		0.0			62.2			90.4
June 30, 2023																							293.7		(47.7	)	$	293.7	$	422.6	$	5,815.3		$	(27.8	)	$	(2,592.8	)	$	3,911.0

There have been no other accounting pronouncements issued but not yet adopted by the Company which are expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

Stock Based Compensation Plans

In the first quarter of 2023, the Company updated its Long-Term Incentive Program (“LTIP”) to provide employees with an award of stock options and initial grants of restricted stock units (“RSUs”), and made an initial grant of performance share units ("PSUs") to members of the Company's Executive Leadership Team ("ELT"). In connection with this update, the awards, which were granted in the second quarter in previous years, were granted in the first quarter of 2023 and are expected to be granted in the first quarter in subsequent years. The stock option terms remain unchanged and are summarized in more detail in the Stock Based Compensation footnote within the Company’s 2022 Form 10-K. The Company recognizes the grant-date fair value for each of these awards, less estimated forfeitures, as compensation expense ratably over the vesting period.

Stock Options

The following table provides a summary of option activity:


						Weighted									Weighted
						Average									Average
				Weighted		Remaining							Weighted		Remaining
				Average		Contractual		Aggregate					Average		Contractual		Aggregate
				Exercise		Term		Intrinsic					Exercise		Term		Intrinsic
	Options			Price		(in Years)		Value		Options			Price (per share)		(in Years)		Value
Outstanding at December 31, 2021		11.3		$	58.83
Outstanding at December 31, 2022											11.9		$	62.64
Granted		1.5			85.21						1.0			83.55
Exercised		(0.6	)		40.81						(2.1	)		42.91
Cancelled		(0.3	)		78.76						(0.2	)		81.10
Outstanding at September 30, 2022		11.9		$	62.53		5.9	$	159.0
Exercisable at September 30, 2022		7.3		$	50.77		4.2	$	159.0
Outstanding at June 30, 2023											10.6		$	68.16		6.2	$	343.2
Exercisable at June 30, 2023											6.8		$	58.74		4.8	$	282.3

The following table provides information regarding the intrinsic value of stock options exercised and stock compensation expense related to stock option awards:


	Three Months Ended				Nine Months Ended				Three Months Ended				Six Months Ended
	September 30,		September 30,		September 30,		September 30,		June 30,		June 30,		June 30,		June 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Intrinsic Value of Stock Options Exercised	$	3.3	$	12.0	$	29.6	$	30.8	$	97.0	$	9.5	$	107.7	$	26.3
Stock Compensation Expense Related to Stock Option Awards	$	4.1	$	3.4	$	21.6	$	19.9	$	4.4	$	14.7	$	18.9	$	17.5
Issued Stock Options		0.0		0.0		1.5		1.5		0.0		1.5		1.0		1.5
Weighted Average Fair Value of Stock Options issued (per share)	$	0.0	$	0.0	$	21.48	$	17.33	$	0.0	$	21.43	$	24.03	$	21.45
Fair Value of Stock Options Issued	$	0.0	$	0.0	$	32.7	$	26.1	$	0.0	$	31.3	$	24.7	$	31.6

The following table provides a summary of the assumptions used in the valuation of issued stock options:

Three Months Ended

Nine Months Ended

September 30,

September 30,

September 30,

September 30,

2022

2021

2022

2021

Risk-free interest rate
-

-

2.9
%

1.3
%
Expected life in years
-

-

7.1

7.2

Expected volatility
-

-

21.7
%

20.7
%
Dividend yield
-

-

1.2
%

1.2
%


	Three Months Ended				Six Months Ended
	June 30,	June 30,			June 30,			June 30,
	2023	2022			2023			2022
Risk-free interest rate	N/A		2.9	%		4.0	%		2.9	%
Expected life in years	N/A		7.1			7.3			7.1
Expected volatility	N/A		21.7	%		22.4	%		21.7	%
Dividend yield	N/A		1.2	%		1.3	%		1.2	%

The Company updated its LTIP in the first quarter of 2023 to add RSUs to its annual employee compensation program. As a result of this update, the Company granted employees exactly 117,920 RSUs with a total fair value of $10.1 at a weighted average grant date fair value of $85.99 per RSU during the six months ended June 30, 2023. The annual RSU grants vest one-third on each of the first, second and third anniversaries of the grant date, subject to the recipient’s continued employment with the Company from the grant date through the applicable vesting date, and are settled with shares of the Company’s Common Stock within 60 days following the applicable vesting date.

Additionally, in connection with the Hero Acquisition (see Note 10), exactly 854,882 shares of restricted stock were issued in October 2022 with a total fair value of $61.5. The restricted stock will be recognized as compensation expense as the stock is subject to vesting requirements for individuals who received the restricted stock and will continue to be employed by the Company. The vesting requirements are satisfied at various dates over a three-year period from the date of the acquisition.

In the first quarter of 2023, the Company granted PSUs to members of the ELT including the CEO, with an aggregate award fair value equal to $2.2. Exactly 19,650 PSUs were issued at a weighted average grant date fair value equal to $110.95 per PSU using a Monte Carlo model. The performance target is based on the Company's total shareholder return ("TSR") relative to a Company selected peer group. The PSUs vest on the later of (i) the third anniversary of the grant date, and (ii) the date that the Compensation & Human Capital Committee certifies the achievement of the applicable performance goals, in each case, subject to the recipient’s continued employment with the Company from the grant date through the vesting date. The number of shares that may be issued ranges from 0% to 200% based on relative TSR during the three-year performance period. Vested PSUs will be settled into shares of the Company’s Common Stock, if at all, within 60 days following the vesting date.

As a result of the Company’s ~~recent~~ stock repurchases, there remains $729.7 of share repurchase availability under the 2021 Share Repurchase Program as of ~~September~~June 30, ~~2022.~~ 2023.

Fair Value Measurements

The following table ~~provides~~presents the carrying amounts and estimated fair values of the Company’s other financial instruments at ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021:~~2022:


		September 30, 2022						December 31, 2021					June 30, 2023				December 31, 2022
	Input	Carrying			Fair			Carrying		Fair		Input	Carrying		Fair		Carrying		Fair
	Level	Amount			Value			Amount		Value		Level	Amount		Value		Amount		Value
Financial Assets:
Cash equivalents	Level 1	$	192.0		$	192.0		$	17.1	$	17.1	Level 1	$	256.0	$	256.0	$	153.9	$	153.9
Financial Liabilities:
Short-term borrowings	Level 2		3.3			3.3			252.8		252.8	Level 2		4.0		4.0		74.0		74.0
2.45% Senior notes due August 1, 2022	Level 2		0.0			0.0			300.0		302.9
2.875% Senior notes due October 1, 2022	Level 2		400.0			400.0			399.9		406.4
Term loan due December 22, 2024	Level 2		400.0			400.0			400.0		400.0	Level 2		200.0		200.0		400.0		400.0
3.15% Senior notes due August 1, 2027	Level 2		424.8			387.7			424.7		450.1	Level 2		424.8		399.5		424.8		397.3
2.3% Senior notes due December 15, 2031	Level 2		399.2			313.2			399.2		403.5	Level 2		399.3		329.0		399.3		321.3
5.6% Senior notes due November 15, 2032												Level 2		499.1		526.5		499.1		518.9
3.95% Senior notes due August 1, 2047	Level 2		397.6			313.5			397.5		471.6	Level 2		397.7		333.3		397.6		316.7
5.00% Senior notes due June 15, 2052	Level 2		499.8			458.3		0.0		0.0		Level 2		499.8		488.2		499.7		464.7
Interest Rate Lock Agreement (asset) liability	Level 2		(12.5	)		(12.5	)		41.6		41.6
Business Acquisition Liabilities	Level 3		34.0			34.0			34.0		34.0

The Company recognizes transfers between input levels as of the actual date of the event. There were no transfers between input levels during the ~~nine~~six months ended ~~September~~June 30, ~~2022.~~2023.

Refer to Note 2 in the Form 10-K for a description of the methods and assumptions used to estimate the fair value of each class of financial instruments reflected in the condensed consolidated balance sheets.

The business acquisition liabilities represent the estimated fair value of additional future contingent consideration payable for acquisitions of businesses that included contingent consideration clauses. The fair value of business acquisition liabilities is evaluated on an ongoing basis and is based on management estimates and entity-specific assumptions which are considered Level 3 inputs. As of both September 30, 2022 and December 31, 2021, the Company had a business acquisition liability of $~~20.0~~ ~~in connection with the Zicam Acquisition and a $14.0~~ ~~business acquisition liability in connection with the TheraBreath Acquisition (both of which are defined in Note 10). Any amount that may be due for the Zicam business acquisition liability is payable~~ ~~five years~~ ~~from the closing date. Any amount that may be due for the TheraBreath business acquisition liability is payable in installments between~~ ~~two~~ ~~and~~ ~~four years~~ ~~from the closing~~.

The interest rate lock agreements outstanding as of December 31, 2021 were used to hedge the risk of changes in the interest payments associated with the 5.0% Senior Notes due June 15, 2052. These agreements were settled in the second quarter of 2022 for a loss of $~~4.2, which will be amortized into interest expense over~~ ~~ten years~~. The Company has entered into additional interest rate lock agreements in the third quarter of 2022 which are used to hedge the risk of changes in the interest payments associated with the anticipated issuance of debt in the fourth quarter of 2022.

~~The~~ carrying amounts of Accounts Receivable, ~~and~~ Accounts Payable, and Accrued ~~Expenses,~~and Other Liabilities, approximated estimated fair values as of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021.~~2022.

10.

Acquisitions

On October 13, 2022, the Company acquired all of the issued and outstanding shares of capital stock of Hero Cosmetics, Inc. ("Hero"), the developer of the HERO® brand which includes the MIGHTY PATCH® acne treatment products (the “Hero Acquisition”). The Company paid $546.8, net of cash acquired, at closing, and deferred an additional cash payment of $8.0 for five years to satisfy certain indemnification obligations, if necessary. The Company also issued $61.5 of restricted stock which will be recognized as compensation expense as the vesting requirements for individuals who received the restricted stock, and will continue to be employed by the Company, are satisfied. The vesting requirements are satisfied at various dates over a three-year period from the date of the acquisition. Hero’s annual net sales for the year ended December 31, 2022 were approximately $179.0. The Hero Acquisition was financed with cash on hand and commercial paper borrowings and is managed in the Consumer Domestic segment. In the first quarter of 2023, the Company made a net cash payment of $3.5 primarily associated with final working capital adjustments.

The preliminary fair values of the net assets at acquisition are set forth as follows:


Accounts receivable	$	19.5
Inventory		25.4
Other current assets		1.2
Property, plant and equipment		0.4
Trade name		400.0
Other intangible assets		71.9
Goodwill		156.1
Accounts payable, accrued and other liabilities		(1.1	)
Deferred and Other Long-term Liabilities		(1.4	)
Deferred income taxes		(117.2	)
Business acquisition liabilities - long-term		(8.0	)
Cash purchase price (net of cash acquired)	$	546.8

The trade name and other intangible assets were valued using a discounted cash flow model. The trade name and other intangible assets recognized from the Hero Acquisition have useful lives which range from 10 - 20 years. The goodwill is a result of expected synergies from combined operations of the acquired business and the Company. Pro forma results are not presented because the impact of the acquisition is not material to the Company’s consolidated financial results. The goodwill and other intangible assets associated with the Hero Acquisition are not deductible for U.S. tax purposes.

On December 24, 2021, the Company acquired all of the outstanding equity of Dr. Harold Katz, LLC and HK-IP International, Inc., the owners of the THERABREATH® brand of oral care products business (the “TheraBreath Acquisition”). The Company paid $556.0, net of cash acquired, at closing and deferred an additional cash payment of $14.0 related to certain indemnity obligations provided by the seller. The ~~deferred amount is recorded in Business Acquisition Liabilities on the consolidated balance sheet and the~~ additional amount, to the extent not used in satisfaction of such indemnity obligations, is payable in installments between two and four years from the closing. THERABREATH’s annual net sales for the year ended December 31, 2021 were approximately $100.0. The acquisition was financed by the proceeds from a $400.0 three-year term loan and the Company’s underwritten public offering of $400.0 aggregate principal ~~2.30%~~ Senior Notes due on December 15, 2031 completed on December 10, 2021. The THERABREATH business is managed in the Consumer Domestic and Consumer International segments. In 2022, the Company made net cash payments of $3.8 primarily associated with final working capital adjustments.

The fair values of the net assets at acquisition are set forth as follows:


Accounts receivable	$	11.3		$	11.3
Inventory		12.9			12.9
Trade name (indefinite lived)		487.0			487.0
Other intangible assets		30.1			30.1
Goodwill		39.9			43.7
Accounts payable and accrued expenses		(11.2	)		(15.0	)
Business acquisition liabilities - long-term		(14.0	)		(14.0	)
Cash purchase price (net of cash acquired)	$	556.0		$	556.0

The trade names and other intangible assets were valued using a discounted cash flow model. The life of the amortizable intangible assets recognized from the TheraBreath Acquisition have a useful life which ranges from 10- 20years. The goodwill is a result of expected synergies from combined operations of the acquired business and the Company. Pro forma results are not presented because the impact of the acquisition ~~was~~is not material to the Company’s consolidated financial results. The goodwill and other intangible assets associated with the TheraBreath Acquisition are deductible for U.S. tax purposes.

On December 1, 2020, the Company acquired all of the outstanding equity of Consumer Health Holdco LLC, the owner of the ZICAM® brand and cold remedy products business (the “Zicam Acquisition”). The Company paid $~~512.7, net of cash acquired, at closing and deferred an additional cash payment of $20.0~~ related to certain indemnifications provided by the seller. The deferred amount is recorded in Business Acquisition Liabilities on the consolidated balance sheet and any amount that may be due for the business acquisition liability is payable ~~five years~~ ~~from the closing. Zicam’s annual net sales for the year ended December 31, 2020 were approximately $107.0. The acquisition was financed by the Company with a combination of cash on hand and short-term borrowings. The ZICAM business is managed in the Consumer Domestic segment.~~

~~The fair values of the net assets at acquisition are set forth as follows:~~

Inventory and other working capital
$
40.2

Property, plant and equipment

0.5

Trade name

367.8

Other intangible assets

93.8

Goodwill

152.2

Current liabilities

(13.1
)
Deferred income taxes

(108.0
)
Long-term liabilities

(20.7
)
Cash purchase price (net of cash acquired)
$
512.7

~~The trade names and other intangible assets were valued using a discounted cash flow model. All of the intangible assets recognized from the Zicam Acquisition have a useful life which ranges from~~ 10 - 20 years. The goodwill is a result of expected synergies from combined operations of the acquired business and the Company. Pro forma results are not presented because the impact of the acquisition was not material to the Company’s consolidated financial results. The goodwill and other intangible assets associated with the Zicam Acquisition are not deductible for U.S. tax purposes.

11.

Goodwill and Other Intangibles, Net

The Company has intangible assets of substantial value on its condensed consolidated balance sheet. These intangible assets are generally related to intangible assets with a useful life, indefinite-lived trade names and goodwill. The Company determines whether an intangible asset (other than goodwill) has a useful life based on multiple factors, including how long the Company intends to generate cash flows from the asset. These intangible assets are more fully explained in the following sections.

Intangible Assets With a Useful Life

The following table provides information related to the carrying value of ~~all~~ intangible assets ~~other than goodwill:~~with a useful life:


	September 30, 2022							December 31, 2021							June 30, 2023								December 31, 2022
	Gross							Gross							Gross							Amortization	Gross
	Carrying		Accumulated					Carrying		Accumulated					Carrying		Accumulated					Period	Carrying		Accumulated
	Amount		Amortization			Net		Amount		Amortization			Net		Amount		Amortization			Net		(Years)	Amount		Amortization			Impairments			Net
Amortizable intangible assets:
Trade Names	$	1,384.7	$	(384.5	)	$	1,000.2	$	1,386.7	$	(336.2	)	$	1,050.5	$	1,385.3	$	(364.0	)	$	1,021.3	3-20	$	1,785.8	$	(406.2	)	$	(319.0	)	$	1,060.6
Customer Relationships		664.0		(349.3	)		314.7		664.0		(322.4	)		341.6		644.9		(356.5	)		288.4	15-20		723.4		(358.9	)		(59.3	)		305.2
Patents/Formulas		239.1		(110.6	)		128.5		239.1		(99.4	)		139.7		208.3		(110.0	)		98.3	4-20		251.7		(114.6	)		(32.7	)		104.4
Total	$	2,287.8	$	(844.4	)	$	1,443.4	$	2,289.8	$	(758.0	)	$	1,531.8	$	2,238.5	$	(830.5	)	$	1,408.0		$	2,760.9	$	(879.7	)	$	(411.0	)	$	1,470.2

~~Indefinite Lived Intangible Assets - Gross Carrying Amount~~

September 30,

December 31,

2022

2021

Trade Names
$
1,960.7

$
1,962.5

Intangible amortization expense was $~~29.3~~31.1 and $~~29.9~~29.3 for the ~~third~~second quarter of ~~2022~~2023 and ~~2021,~~2022, respectively. Intangible amortization expense amounted to $~~88.1~~62.2 and $~~90.9~~58.8 for the first ~~nine~~six months of ~~2022~~2023 and ~~2021,~~2022, respectively. The Company estimates that intangible amortization expense will be approximately $~~117.0~~124.0 in ~~2022~~2023 and approximately $~~115.0~~123.0 to $~~107.0~~94.0 annually over the next five years.

In the fourth quarter of 2022, the Company determined that a review of our ability to recover the carrying values of the global FINISHING TOUCH FLAWLESS intangible assets was necessary based on the discontinuance of certain products at a major retailer. The FINISHING TOUCH FLAWLESS assets consist of the definite-lived trade name, customer relationships and technology assets recorded at acquisition. The Company evaluated our ability to recover the intangible assets by comparing the carrying amount to the

future undiscounted cash flows and determined that the cash flows would not be sufficient to recover the carrying value of the assets. After determining the estimated fair value of the assets, which included a reduction in cash flows due to the loss of distribution mentioned above along with an expected continued decline in discretionary consumption and higher interest rates, a non-cash impairment charge of $411.0 was recorded in the fourth quarter of 2022. The impairment charge was applied as a full impairment of the customer relationship and technology assets and a partial impairment of the trade name. The remaining net book value of the trade name as of December 31, 2022 is $46.3 and will be amortized over a remaining useful life of three years. The estimated fair value of the intangible assets was determined using the income approach with Level 3 inputs. The Level 3 inputs include the discount rate of 8.5% applied to management’s estimates of future cash flows based on projections of revenue, gross margin, marketing expense and tax rates considering the loss of product distribution and the reduction in customer demand that FINISHING TOUCH FLAWLESS had been experiencing through December 31, 2022. The Company is implementing strategies to address the decline in profitability. However, if unsuccessful, a further decline could trigger a future impairment charge.

Indefinite-Lived Intangible Assets

The following table presents the carrying value of indefinite-lived intangible assets:


	June 30,		December 31,
	2023		2022
Trade Names	$	1,961.8	$	1,961.4

The Company’s indefinite lived intangible impairment review is completed in the fourth quarter of each year.

Fair value for ~~indefinite lived~~indefinite-lived intangible assets was estimated based on a “relief from royalty” or “excess earnings” discounted cash flow method, which contains numerous variables that are subject to change as business conditions change, and therefore could impact fair values in the future. The key assumptions used in determining fair value are sales growth, profitability margins, tax rates, discount rates and

royalty rates. The Company determined that the fair value of all indefinite lived intangible assets for each of the years in the three-year period ended December 31, ~~2021~~2022 exceeded their respective carrying values based upon the forecasted cash flows and profitability.

Recently, the Company’s global FLAWLESS business has experienced declining customer demand for many of its products, primarily due to lower consumer spending for discretionary products from inflation. In addition, the FLAWLESS business has also started to experience margin contraction as the Company has been unable to implement price increases in a highly competitive category to offset higher labor, material and transportation costs. These factors have resulted in a reduction in expected future cash flows that, if these factors persist or continue to worsen, may result in cash flows that are not sufficient to recover the carrying value of the long-lived assets of the business. The projected cash flows exceed the carrying value of the long lived assets by slightly more than 10%. The key assumptions used to determine the projected cash flows include revenue, gross margin and marketing expense assumptions based on recent trends, including the reduction in customer demand for discretionary products and declining gross margins that FLAWLESS has been experiencing. The carrying value of the long-lived assets for the FLAWLESS business is approximately $~~465.0~~ ~~at September 30, 2022. These assets are being amortized over their remaining weighted average life of~~ 16 years. The long-lived assets of the FLAWLESS business are susceptible to impairment risk based on the factors described above. While management can and has implemented strategies to address the risk, including lowering the Company’s production costs, investing in new product ideas, and developing new creative advertising, significant adverse changes in demand, operating plans or economic factors in the future could reduce the underlying cash flows that could trigger a future impairment charge.

In recent years the Company’s global TROJAN® business, specifically the condom category, has not grown and competition has increased. ~~Social distancing requirements due to the COVID-19 pandemic had further~~In addition, profitability was negatively impacted ~~the business.~~by inflation throughout 2022, resulting in higher input costs and discount rates, and supply shortages for packaging materials. As a result, the TROJAN business ~~had~~has experienced ~~stagnant~~declining sales and profits resulting in a reduction in expected future cash flows which have eroded a portion of the excess between the fair and carrying value of the ~~tradename.~~trade name. This indefinite-lived intangible asset may be susceptible to impairment ~~risk~~ and a continued decline in fair value could trigger a future impairment charge of the TROJAN ~~tradename.~~trade name. The carrying value of the TROJAN ~~tradename~~trade name is $176.4 and fair value exceeded carrying value by 7046% as of October 1, ~~2021.~~2022. The key assumptions used in the projections from the Company’s October 1, ~~2021~~2022 impairment analysis include discount rates of ~~7.0~~8.0% in the U.S. and ~~8.5~~9.5% internationally, revenue assumptions based on recent trends adjusted for management’s estimates of the success of its growth strategies and the impact of improvement in the supply chain, and an average royalty rate of approximately 10%. While management has implemented strategies to address the risk, including lowering production costs, investing in new product ideas, and developing new creative advertising, significant changes in operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate fair value. ~~More recently,~~Due to the results of the Company's annual impairment test of the TROJAN trade name, the company monitors the performance of this business on at least a quarterly basis. Based on that review, the Company's expectations regarding the profitability of the global TROJAN® business has experienced a recovery in sales and profits as it has benefited from an easing of COVID-19 social restrictions which led to an increase in sexual activity. The Company expects this trend will continue withnot substantially changed since the ~~adoption of vaccines, the reduction of social distancing restrictions and the benefit of management strategies to improve sales and profitability.~~Company's last impairment test.

The Company’s ~~Passport Food Safety~~global WATERPIK business has recently experienced a significant decline in customer demand for many of its products, primarily due to lower consumer spending for discretionary products from inflation and a growing number of water flosser consumers switching to more value-branded products. As a result, the WATERPIK business has experienced declining sales and ~~profit declines due to decreased demand driven by the COVID-19 pandemic and pressures from new competitive activities~~profits resulting ~~from the loss of exclusivity on~~in a key product line. In the fourth quarter of 2021, management’s review of the outlook for the Passport business indicated an assessment of the recoverability of the long-lived assets associated with the business was necessary. That review determined that the estimatedreduction in expected future cash flows ~~would not be sufficient to recover~~which have eroded a substantial portion of the excess between the fair and carrying value of the ~~assets resulting~~trade name. This indefinite-lived intangible asset may be susceptible to impairment and a continued decline in anfair value could trigger a future impairment charge of the ~~associated tradename~~WATERPIK trade name. The carrying value of the WATERPIK trade name is $644.7 and ~~other intangible assets~~fair value exceeded carrying value by 7% as of $~~11.3~~October 1, 2022. The key assumptions used in the ~~fourth quarter of 2021. The charge was recorded in selling, general and administrative expenses. The assets have~~projections from the Company’s October 1, 2022 impairment analysis include a ~~current net book value of approximately $8.5~~ ~~and are being amortized over their remaining weighted average life~~discount rate of 6 8.4~~years. The Company is implementing~~%, revenue growth rates between 0% and 6% and EBITA margins between 18% and 21%. These assumptions are based on current market conditions, recent trends and management’s expectation of the success of initiatives to lower costs (including tariffs) and to develop lower-cost water flosser alternatives as well as improvement in the supply chain. While management has implemented strategies to address the ~~decline~~risk, significant changes in ~~profitability. However, if unsuccessful,~~operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate fair value. Due to the results of the Company's annual impairment test of the WATERPIK trade name, the company monitors the performance of this ~~decline could trigger an additional future~~business on at least

a quarterly basis. Based on that review, the Company's expectations regarding the profitability of the global WATERPIK business has not substantially changed since the Company's last impairment ~~char~~test.ge

Goodwill

The carrying amount of goodwill is as follows:

Consumer

Consumer

Specialty

Domestic

International

Products

Total

Balance at December 31, 2021
$
1,899.8

$
238.7

$
136.0

$
2,274.5

TheraBreath adjustment

0.5

(4.3
)

0.0

(3.8
)
Balance at September 30, 2022
$
1,900.3

$
234.4

$
136.0

$
2,270.7


	Consumer		Consumer		Specialty
	Domestic		International		Products		Total
Balance at December 31, 2022	$	2,056.4	$	234.4	$	136.0	$	2,426.8
Hero working capital adjustment		3.5		0.0		0.0		3.5
Balance at June 30, 2023	$	2,059.9	$	234.4	$	136.0	$	2,430.3

The result of the Company’s annual goodwill impairment test, performed in the beginning of the second quarter of ~~2022,~~2023, determined that the estimated fair value substantially exceeded the carrying values of all reporting units. The determination of fair value contains numerous variables that are subject to change as business conditions change and therefore could impact fair value in the future. ~~The Company has never incurred a goodwill impairment charge.~~

12.

Leases

The Company leases certain manufacturing facilities, warehouses, office space, railcars and equipment. Leases with an initial term of twelve months or less are not recorded on the condensed consolidated balance sheet. All recorded leases are classified as operating leases and lease expense is recognized on a straight-line basis over the lease term. For leases beginning in 2019, lease components (base rental costs) are accounted for separately from the nonlease components (e.g., common-area maintenance costs). For leases that do not provide an implicit rate, the Company uses its estimated secured incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

A summary of the Company’s lease information is as follows:


		September 30,			December 31,				June 30,			December 31,
	Classification	2022			2021			Classification	2023			2022
Assets
Right of use assets	Other Assets	$	166.7		$	159.4		Other Assets	$	156.3		$	162.6

Liabilities
Current lease liabilities	Accounts Payable and Accrued Expenses	$	22.8		$	24.4		Accrued and other liabilities	$	23.1		$	21.9
Long-term lease liabilities	Deferred and Other Long-term Liabilities		155.5			146.6		Deferred and Other Long-term Liabilities		145.9			151.9
Total lease liabilities		$	178.3		$	171.0			$	169.0		$	173.8

Other information
Weighted-average remaining lease term (years)			9.1			9.1				8.5			8.9
Weighted-average discount rate			4.4	%		4.3	%			4.5	%		4.4	%


	Three Months		Three Months		Nine Months		Nine Months		Three Months		Three Months		Six Months		Six Months
	Ended		Ended		Ended		Ended		Ended		Ended		Ended		Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021		June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Statement of Income
Lease cost(1)	$	7.7	$	8.1	$	23.1	$	24.6	$	7.9	$	7.5	$	15.6	$	15.4

Other information
Leased assets obtained in exchange for new lease liabilities net of modifications(2)	$	9.5	$	0.4	$	26.8	$	4.5	$	4.1	$	15.8	$	5.1	$	17.3
Cash paid for amounts included in the measurement of lease liabilities	$	7.8	$	8.0	$	23.3	$	24.5	$	7.9	$	8.0	$	15.5	$	15.5

(1)

Lease expense is included in cost of sales or SG&A expenses based on the nature of the leased item. Short-term lease expense is excluded from this amount and is not material. The Company also has certain variable leases which are not material. The non-cash component of lease expense for the first ~~nine~~six months of ~~2022~~2023 and ~~2021~~2022 was $~~18.0~~11.9 and $~~19.1~~12.1, respectively, and is included in the Amortization caption in the condensed consolidated statement of cash flows.

(2)

In September 2022, the Company amended its contract at one of its international locations. This resulted in an increase to the Company’s right of use assets and corresponding lease liabilities of approximately $~~8.2~~ ~~recorded in the third quarter of 2022.~~ In June 2022, the Company amended its contract at one of its leased manufacturing facilities. This resulted in an increase to the Company’s right of use assets and corresponding lease liabilities of approximately $15.2 recorded in the second quarter of 2022.

The Company’s minimum annual rentals including reasonably assured renewal options under lease agreements are as follows:


	Operating			Operating
	Leases			Leases
2022	$	8.1
2023		28.6		$	15.1
2024		27.2			30.0
2025		26.1			28.2
2026		18.7			19.9
2027 and thereafter		112.1
2027					18.8
2028 and thereafter					94.9
Total future minimum lease commitments		220.8			206.9
Less: Imputed interest		(42.5	)		(37.9	)
Present value of lease liabilities	$	178.3		$	169.0

14.

Short-Term Borrowings and Long-Term Debt

Short-term borrowings and long-term debt consist of the following:


	September 30,			December 31,			June 30,			December 31,
	2022			2021			2023			2022
Short-term borrowings
Commercial paper issuances	$	0.0		$	249.7		$	0.0		$	70.6
Various debt due to international banks		3.3			3.1			4.0			3.4
Total short-term borrowings	$	3.3		$	252.8		$	4.0		$	74.0

Long-term debt
2.45% Senior notes due August 1, 2022		0.0			300.0
2.875% Senior notes due October 1, 2022(1)		400.0			400.0
Less: Discount		0.0			(0.1	)
Term loan due December 22, 2024		400.0			400.0		$	200.0		$	400.0
3.15% Senior notes due August 1, 2027		425.0			425.0			425.0			425.0
Less: Discount		(0.2	)		(0.3	)		(0.2	)		(0.2	)
2.3% Senior notes due December 15, 2031		400.0			400.0			400.0			400.0
Less: Discount								(0.7	)		(0.7	)
5.6% Senior notes due November 15, 2032								500.0			500.0
Less: Discount		(0.8	)		(0.8	)		(0.9	)		(0.9	)
3.95% Senior notes due August 1, 2047		400.0			400.0			400.0			400.0
Less: Discount		(2.4	)		(2.5	)		(2.3	)		(2.4	)
5.00% Senior notes due June 15, 2052		500.0			0.0			500.0			500.0
Less: Discount		(0.2	)		0.0			(0.2	)		(0.3	)
Debt issuance costs, net		(17.0	)		(11.2	)		(19.8	)		(21.0	)
Total long-term debt		2,504.4			2,310.1
Less: Current maturities		(400.0	)		(699.4	)
Net long-term debt	$	2,104.4		$	1,610.7		$	2,400.9		$	2,599.5

~~(1)~~ ~~In October 2022, the Company repaid the full amount of the~~ ~~2.875% Senior Notes due~~ ~~October 1, 2022~~ ~~with a portion of the proceeds from the~~ ~~5.00% Senior notes issued on June 2, 2022 and due~~ ~~June 15, 2052~~ ~~and cash on hand.~~

~~New Credit Agreement~~

~~On June 16, 2022, the Company entered into a credit agreement (the “Credit Agreement”) that provides for a $1,500.0~~ ~~unsecured revolving credit facility (the “Revolving Credit Facility”) that matures on June 16, 2027, unless extended. The Credit Agreement replaced the Company’s prior $1,000.0~~ ~~unsecured revolving credit facility maturing on March 29, 2024 that was entered into on March 29, 2018. The Company continues to have the ability to increase its borrowing up to an additional $750.0~~, subject to lender commitments and certain conditions as described in the Credit Agreement. Borrowings under the Credit Agreement are available for general corporate purposes and are used to support the Company's $~~1,000.0~~ ~~commercial paper program.~~

~~5.00% Senior Notes due June 15, 2052~~

~~On June 2, 2022, the Company issued $500.0~~ ~~aggregate principal amount of~~ ~~5.00~~% Senior Notes due 2052 (the “2052 Notes”). The 2052 Notes were issued under the second supplemental indenture (the “Second Supplemental Indenture”), dated June 2, 2022, to the indenture dated December 10, 2021 (the “Indenture”). In July 2022 a portion of the proceeds from the sale of the Notes were used to repay all of the Company's outstanding $~~300.02.45% Senior Notes due August 1, 2022. The remaining proceeds were used to pay a portion of the Company's $400.0~~ ~~outstanding~~ ~~2.875% Senior Notes due October 1, 2022. The 2052 Notes will mature on June 15, 2052, unless earlier retired or redeemed pursuant to the terms of the Second Supplemental Indenture.~~

15.

Accumulated Other Comprehensive Income (Loss)

The components of changes in accumulated other comprehensive income (loss) are as follows:

Accumulated

Foreign

Defined

Other

Currency

Benefit

Derivative

Comprehensive

Adjustments

Plans

Agreements

Income (Loss)

Balance at December 31, 2020
$
(26.4
)

$
0.0

$
(51.2
)

$
(77.6
)
Other comprehensive income (loss) before reclassifications

(4.7
)

(0.9
)

32.4

26.8

Amounts reclassified to consolidated statement of
income (a) (b)

0.0

0.0

(2.9
)

(2.9
)
Tax benefit (expense)

0.0

0.2

(7.4
)

(7.2
)
Other comprehensive income (loss)

(4.7
)

(0.7
)

22.1

16.7

Balance at September 30, 2021
$
(31.1
)

$
(0.7
)

$
(29.1
)

$
(60.9
)

Balance at December 31, 2021
$
(30.2
)

$
(0.6
)

$
(37.4
)

$
(68.2
)
Other comprehensive income (loss) before reclassifications

(27.8
)

2.5

66.1

40.8

Amounts reclassified to consolidated statement of
income (a) (b)

0.0

0.0

(1.2
)

(1.2
)
Tax benefit (expense)

0.0

(0.6
)

(16.9
)

(17.5
)
Other comprehensive income (loss)

(27.8
)

1.9

48.0

22.1

Balance at September 30, 2022
$
(58.0
)

$
1.3

$
10.6

$
(46.1
)


										Accumulated
	Foreign			Defined						Other
	Currency			Benefit			Derivative			Comprehensive
	Adjustments			Plans			Agreements			Income (Loss)
Balance at December 31, 2021	$	(30.2	)	$	(0.6	)	$	(37.4	)	$	(68.2	)
Other comprehensive income (loss) before reclassifications		(14.5	)		2.5			46.2			34.2
Amounts reclassified to consolidated statement of income (a) (b)		0.0			0.0			(0.3	)		(0.3	)
Tax benefit (expense)		0.0			(0.6	)		(12.2	)		(12.8	)
Other comprehensive income (loss)		(14.5	)		1.9			33.7			21.1
Balance at June 30, 2022	$	(44.7	)	$	1.3		$	(3.7	)	$	(47.1	)

Balance at December 31, 2022	$	(46.4	)	$	1.7		$	15.4		$	(29.3	)
Other comprehensive income (loss) before reclassifications		5.7			2.0			(3.9	)		3.8
Amounts reclassified to condensed consolidated statement of income (a) (b)		0.0			0.0			(3.7	)		(3.7	)
Tax benefit (expense)		0.0			(0.5	)		1.9			1.4
Other comprehensive income (loss)		5.7			1.5			(5.7	)		1.5
Balance at June 30, 2023	$	(40.7	)	$	3.2		$	9.7		$	(27.8	)

(a)

Amounts reclassified to cost of sales, selling, general and administrative expenses or interest expense.

18.

Segments

Segment Information

The Company operates three reportable segments: Consumer Domestic, Consumer International and Specialty Products Division. These segments are determined based on differences in the nature of products and organizational structure. The Company also has a Corporate segment.

Segment revenues are derived from the sale of the following products:


Segment			Products
Consumer Domestic			Household and personal care products
Consumer International			Primarily personal care products
SPD			Specialty chemical products

The Corporate segment income consists of equity in earnings of affiliates. As of ~~September~~June 30, ~~2022,~~2023, the Company held 50% ownership interests in each of Armand and ArmaKleen, respectively. The Company’s equity in earnings of Armand and ArmaKleen, ~~totaling~~totaled $~~3.7~~2.0 and $~~2.0~~3.9 for the three months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, respectively, and $~~10.0~~6.4 and $~~7.4~~6.3 for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, respectively, are included in the Corporate segment.

Certain subsidiaries that are included in the Consumer International segment manufacture and sell personal care products to the Consumer Domestic segment. These sales are eliminated from the Consumer International segment results set forth in the table below.

Segment net sales and income before income taxes are as follows:

Consumer

Consumer

Domestic

International

SPD

Corporate(3)

Total

Net Sales(1)

Third Quarter 2022
$
1,010.4

$
219.7

$
87.2

$
0.0

$
1,317.3

Third Quarter 2021

998.1

227.0

86.3

0.0

1,311.4

First Nine Months of 2022
$
3,010.2

$
664.8

$
264.6

$
0.0

$
3,939.6

First Nine Months of 2021

2,900.2

670.2

251.0

0.0

3,821.4

Income before Income Taxes(2)

Third Quarter 2022
$
193.9

$
22.7

$
14.2

$
3.7

$
234.5

Third Quarter 2021(4)

238.6

34.5

14.2

2.0

289.3

First Nine Months of 2022
$
618.3

$
80.8

$
38.1

$
10.0

$
747.2

First Nine Months of 2021(4)

713.7

110.9

35.6

7.4

867.6


	Consumer		Consumer
	Domestic		International		SPD		Corporate(3)		Total
Net Sales(1)
Second Quarter 2023	$	1,128.2	$	241.9	$	84.1	$	0.0	$	1,454.2
Second Quarter 2022		1,004.7		230.5		89.9		0.0		1,325.1
First Six Months of 2023	$	2,245.1	$	472.5	$	166.4	$	0.0	$	2,884.0
First Six Months of 2022		1,999.8		445.1		177.4		0.0		2,622.3

Income before Income Taxes(2)
Second Quarter 2023	$	230.7	$	27.5	$	9.2	$	2.0	$	269.4
Second Quarter 2022		201.7		28.5		12.4		3.9		246.5
First Six Months of 2023	$	459.4	$	56.4	$	16.0	$	6.4	$	538.2
First Six Months of 2022		424.4		58.1		23.9		6.3		512.7

(1)

Intersegment sales from Consumer International to Consumer Domestic, which are not reflected in the table, were $~~3.9~~3.4 and $~~2.6~~3.8 for the three months ended ~~September~~June 30, ~~2022~~2023 and ~~September~~June 30, ~~2021,~~2022, respectively, and were $~~12.5~~7.0 and $~~7.8~~8.6 for the ~~nine~~six months ended ~~September~~June 30, 2023 and June 30, 2022, ~~and September 30, 2021,~~ respectively.

(2)

In determining income before income taxes, interest expense, investment earnings and certain aspects of other income and expense were allocated among segments based upon each segment’s relative income from operations.

(3)

The Corporate segment consists of equity in earnings of affiliates from Armand and ArmaKleen for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~September~~June 30, ~~2021.~~2022.

~~(4)~~

~~Results for the three months ended September 30, 2021 include a $41.0~~

~~reduction of SG&A expenses to adjust the Flawless business acquisition liability, of which $34.8~~ ~~was recorded to Consumer Domestic and $6.2~~ ~~was recorded to Consumer International. Results for the nine months ended September 30, 2021 include a $98.0~~ ~~reduction of SG&A expenses to adjust the Flawless business acquisition liability, of which $83.2~~ ~~was recorded to Consumer Domestic and $14.8~~ ~~was recorded to Consumer International.~~

Product line revenues from external customers are as follows:


	Three Months Ended				Nine Months Ended				Three Months Ended				Six Months Ended
	September 30,		September 30,		September 30,		September 30,		June 30,		June 30,		June 30,		June 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Household Products	$	592.3	$	535.5	$	1,685.6	$	1,553.7	$	619.2	$	572.8	$	1,220.8	$	1,093.3
Personal Care Products		418.1		462.6		1,324.6		1,346.5		509.0		431.9		1,024.3		906.5
Total Consumer Domestic		1,010.4		998.1		3,010.2		2,900.2		1,128.2		1,004.7		2,245.1		1,999.8
Total Consumer International		219.7		227.0		664.8		670.2		241.9		230.5		472.5		445.1
Total SPD		87.2		86.3		264.6		251.0		84.1		89.9		166.4		177.4
Total Consolidated Net Sales	$	1,317.3	$	1,311.4	$	3,939.6	$	3,821.4	$	1,454.2	$	1,325.1	$	2,884.0	$	2,622.3

Household Products include laundry, deodorizing and cleaning products. Personal Care Products include condoms, pregnancy kits, oral care products, skin care and hair care products, cold and remedy products, and gummy dietary supplements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Since the beginning of the COVID-19 pandemic, the impacts to our business have been primarily supply chain related, including labor shortages and challenges with distribution and transportation, resulting in difficulty meeting consumer demand and significantSignificant broad-based cost ~~inflation. In addition, government restrictions in China have further exacerbated global supply chain challenges~~inflation and ~~have had a negative impact on Chinese~~higher interest rates continue to affect input costs and consumer demand for our products in China. As restrictions in China ease, we expect those impacts to our business in the future to be less severe. While it is difficult to predict with certainty when conditions may improve, we expect shortages and input cost inflation to continue at least throughout 2022.

To address challenges meeting customer demand for certain categories, including laundry detergent and litter, we have taken steps to increase our short-term manufacturing capacity for many of our products as well as our raw material and packaging capacity, and continue to work closely with our suppliers, contract manufacturers and retail partners to increase capacity and ensure sustained supply to keep pace with increased demand. We have also made investments in the expansion of long-term, in-house and third-party manufacturing capacity and are working to enlist additional suppliers that meet our quality specifications. While there is no assurance that these challenges will abate in the foreseeable future, or that the other measures we have or may implement will mitigate the impact of supply disruptions or rising costs, we continued to see an improvement in fill rates in the third quarter, particularly in the household category, and we expect those improvements to continue through the remainder of 2022 across most product categories.

discretionary products. To attempt to offset some of ~~our~~these cost pressures, we have enacted, and continue to evaluate, price increases in certain categories. ~~However,~~While conditions are improving and we expect pricing and productivity to offset inflation in the near term, we expect some raw material and labor shortages and input cost inflation to continue.

Inflation and recessionary concerns are ~~also experiencing~~driving a decline in consumer spending for our most discretionary brands, Waterpik and Flawless, as consumers reduce spending in these categories and ~~a consumer~~ shift to lower cost ~~alternatives due primarily to inflationary and recessionary pressures.~~alternatives. Most notably, a growing number of water flosser consumers have switched to more value-branded products. To address these demand shifts, we are taking steps to better manage production schedules and inventory levels for those products along with increasing promotional activities and marketing spend, as well as continuing efforts to develop lower cost water flosser alternatives. Our portfolio being comprised of 40% value products and our low exposure to private label should help us to mitigate against a potential recessionary environment.

In our vitamin business, we have experienced residual impacts from previous vitamin-specific supply chain challenges that, in some cases, have resulted in reduced shelf space at certain retailers.

In addition, our Specialty Products business has been negatively impacted by the entrance of new foreign competition in the United States dairy market. We expect ~~share gains to continue as we invest in our brands and supply chain fill levels~~that low-priced imports will continue to ~~improve.~~enter the market.

InFor additional discussion of how we are addressing decreased consumer demand for discretionary brands, as well as lower growth and increased competition in the vitamin category, ~~there continues~~please refer to ~~be a softening~~Management's Discussion and Analysis of ~~growth from record high levels during the COVID-19 pandemic~~Financial Condition and ~~significant product competition coming from new category entrants. The category has grown from about 10 competitors a decade ago to more than 50~~Results of ~~significance~~ Operations in recent years. Since 2019 alone, over 35 new brands have entered the gummy segment category. We continue to evaluate and vigorously combat these pressures through, among other things, new product introductions and increased marketing and trade spending. However, there is no assurance this category will not decline in the future and that we will be able to offset any such decline.our Annual Report on Form 10-K.

Looking forward, the impact that these challenges will continue to have on our operational and financial performance will depend on future developments, including inflationary impacts, ~~customer’s~~retail customers' acceptance of all or a portion of any price increases, ~~our continued ability to obtain an adequate supply of products and materials,~~ the spread and severity of new COVID-19 variants, and the long-term impact of vaccines. Additionally, we may be impacted by our ability to recruit and retain a workforce and engage third-parties to manufacture and distribute our products, as well as any future government actions affecting employers and employees, consumers and the economy in general. The impact of any of these potential future developments are uncertain and difficult to predict considering the rapidly evolving landscape.

We are monitoring the impact of both inflation and recessionary indicators including the effect of corresponding government actions, such as raising interest rates to counteract inflation, that may negatively impact consumer spending, and how these factors will potentially influence future cash flows for the short and long term. While we expect that many of these effects will be transitory and that our value focused portfolio positions us well in inflationary and slowing economic environments, it is impossible to predict their impact.

The global economy continues to be negatively impacted by the military conflict between Russia and Ukraine. Furthermore, governments in the U.S., United Kingdom, and European Union have each imposed export controls on certain products as well as financial and economic sanctions on certain industry sectors and parties in Russia and Belarus. We have experienced shortages in materials and increased costs for transportation, energy, and raw material due in part to the negative impact of the Russia-Ukraine military conflict on the global economy including European energy market access to Russian energy sources. Further escalation of geopolitical tensions related to the conflict, including increased trade barriers or restrictions on global trade, could result in, among other things, cyber attacks, supply disruptions, lower consumer demand, and changes to foreign exchange rates and financial markets, any of which may adversely affect our business and supply chain.

~~We have no operations in Russia or Ukraine. Sales into Russia and Belarus, which have been suspended indefinitely, are not material to the Company’s consolidated net sales and earnings.~~

On August 31, 2022, the Company entered into an Agreement and Plan of Merger pursuant to which the Company agreed to acquire all of the issued and outstanding shares of capital stock of Hero Cosmetics, Inc., the developer of the Hero Mighty Patch® brand and other acne treatment products (the “Hero Acquisition”). The total consideration related to the Hero Acquisition, which is subject to adjustment, consists of a purchase price of approximately $565.0 million of cash (of which $8.0 million will be held back for five years to satisfy certain indemnification obligations) and approximately $65.0 million of restricted shares of the Company's common stock which will be recognized as compensation expense as the stock is subject to vesting requirements for individuals who will continue to be employed by the Company. The Hero Acquisition closed on October 13, 2022 and was financed with cash on hand and commercial paper borrowings.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022 (the “Act”), which contains provisions effective January 1, 2023, including a 15% corporate minimum tax and a 1% excise tax on stock buybacks. While we are still evaluating the impact of the Act, we do not expect any material changes on our consolidated financial position, results of operations and cash flows.


	Three Months Ended			Change vs.	Three Months Ended			Three Months Ended			Change vs.	Three Months Ended
	September 30, 2022			Prior Year	September 30, 2021			June 30, 2023			Prior Year	June 30, 2022
Net Sales	$	1,317.3		0.4%	$	1,311.4		$	1,454.2		9.7%	$	1,325.1
Gross Profit	$	549.7		-5.1%	$	579.2		$	638.9		17.2%	$	545.3
Gross Margin		41.7	%	-250 basis points		44.2	%		43.9	%	270 basis points		41.2	%
Marketing Expenses	$	140.7		-12.6%	$	160.9		$	132.2		28.5%	$	102.9
Percent of Net Sales		10.7	%	-160 basis points		12.3	%		9.1	%	130 basis points		7.8	%
Selling, General & Administrative Expenses	$	155.1		32.7%	$	116.9		$	213.1		17.9%	$	180.8
Percent of Net Sales		11.7	%	280 basis points		8.9	%		14.6	%	100 basis points		13.6	%
Income from Operations	$	253.9		-15.8%	$	301.4		$	293.6		12.2%	$	261.6
Operating Margin		19.3	%	-370 basis points		23.0	%		20.2	%	40 basis points		19.8	%
Net income per share - Diluted	$	0.76		-17.4%	$	0.92		$	0.89		17.1%	$	0.76

	Nine Months Ended			Change vs.	Nine Months Ended			Six Months Ended			Change vs.	Six Months Ended
	September 30, 2022			Prior Year	September 30, 2021			June 30, 2023			Prior Year	June 30, 2022
Net Sales	$	3,939.6		3.1%	$	3,821.4		$	2,884.0		10.0%	$	2,622.3
Gross Profit	$	1,647.5		-2.1%	$	1,682.3		$	1,260.9		14.9%	$	1,097.8
Gross Margin		41.8	%	-220 basis points		44.0	%		43.7	%	180 basis points		41.9	%
Marketing Expenses	$	345.5		-8.3%	$	376.6		$	254.5		24.3%	$	204.8
Percent of Net Sales		8.8	%	-110 basis points		9.9	%		8.8	%	100 basis points		7.8	%
Selling, General & Administrative Expenses	$	505.8		25.5%	$	403.0		$	420.9		20.0%	$	350.7
Percent of Net Sales		12.8	%	230 basis points		10.5	%		14.6	%	120 basis points		13.4	%
Income from Operations	$	796.2		-11.8%	$	902.7		$	585.5		8.0%	$	542.3
Operating Margin		20.2	%	-340 basis points		23.6	%		20.3	%	-40 basis points		20.7	%
Net income per share - Diluted	$	2.35		-12.3%	$	2.68		$	1.72		8.2%	$	1.59

Diluted Net Income per share was $0.89 in the second quarter of 2023 as compared to $0.76 in the ~~third~~second quarter of ~~2022 as compared to $0.92 in the third quarter of 2021.~~2022. Diluted Net Income per share was ~~$2.35~~$1.72 in the first ~~nine~~six months of ~~2022~~2023 as compared to ~~$2.68~~$1.59 in the same period in ~~2021.~~2022.

During the third quarter of 2021 we decreased the fair value of our business acquisition liability associated with the 2019 acquisition of the FLAWLESS hair removal business (the “Flawless Acquisition”) by $41.0 ($30.8 after tax or $0.12 diluted per share), for a total net reduction of $98.0 ($73.5 after tax or $0.29 diluted per share) for the nine months ended September 30, 2021, based on updated sales forecasts. After giving effect to the third quarter decrease, the value of the business acquisition liability was reduced to $0.0. The business acquisition liability adjustments were recorded as a reduction in SG&A expense.

Net sales for the quarter ended ~~September~~June 30, ~~2022~~2023 were ~~$1,317.3,~~$1,454.2, an increase of ~~$5.9~~$129.1 or ~~0.4%~~9.7% as compared to the same period in ~~2021.~~2022. Net sales for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 were ~~$3,939.6,~~$2,884.0, an increase of ~~$118.2~~$261.7 or ~~3.1%~~10.0% over the comparable ~~nine~~six month period of ~~2021.~~2022. The components of the net sales increase are as follows:


	Three Months Ended			Nine Months Ended			Three Months Ended			Six Months Ended
	September 30,			September 30,			June 30,			June 30,
Net Sales - Consolidated	2022			2022			2023			2023
Product volumes sold		(8.5	)%		(5.6	)%		(0.4	%)		(0.2	%)
Pricing/Product mix		7.8	%		7.4	%		5.8	%		5.8	%
Foreign exchange rate fluctuations		(1.2	)%		(0.9	)%		(0.2	%)		(0.4	%)
Acquired product lines (1)		2.3	%		2.2	%		4.5	%		4.8	%
Net Sales increase		0.4	%		3.1	%		9.7	%		10.0	%

For both the three and ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, the volume change reflects increased product unit sales in the Consumer International segment, offset by decreased product unit sales ~~for all three~~in the Consumer Domestic and the SPD segments. For both the three and ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, price/mix was favorable in ~~all three segments.~~the Consumer Domestic and Consumer International segments partially offset by the SPD segment.

Our gross profit was ~~$549.7~~$638.9 for the three months ended ~~September~~June 30, ~~2022,~~2023, a ~~$29.5 decrease~~$93.6 increase as compared to the same period in ~~2021.~~2022. Gross margin ~~decreased 250~~increased 270 basis points (“bps”) in the ~~third~~second quarter of ~~2022~~2023 compared to the same period in ~~2021,~~2022, due to favorable price/mix/volume of 280 bps, the impact of productivity programs of 160 bps, business acquisition mix benefits of 120 bps, lower transportation costs of 110 bps, and favorable foreign exchange of 10 bps, offset by the impact of higher manufacturing costs, including labor, of ~~300~~310 bps, and higher commodities of ~~250~~100 bps. Gross profit was $1,260.9 for the six months ended June 30, 2023, a $163.1 increase compared to the same period in 2022. Gross margin increased 180 bps ~~and~~ ~~higher transportation costs~~in the first six months of ~~30 bps,~~ ~~offset by~~2023 compared to the same period in 2022, due to favorable price/~~volume/mix~~mix/volume of ~~190~~210 bps, the impact of productivity programs of 160 bps, business acquisition mix benefits of 120 bps, lower transportation costs of 90 bps, and ~~business acquisition benefits~~favorable foreign exchange of ~~20 bps. Gross profit was $1,647.5 for the nine months ended September 30, 2022, a $34.8 decrease compared to the same period in 2021. Gross margin decreased 220~~10 bps, ~~in the first nine months of 2022 compared to the same period in 2021, due to~~offset by the impact of higher manufacturing costs, including labor of ~~260~~330 bps, and higher commodities of ~~250 bps, and~~ ~~higher transportation costs of 70 bps,~~ ~~offset by favorable price/volume/mix of 240 bps, the impact of productivity programs of 100 bps, and business acquisition benefits of 20~~80 bps.

Marketing expenses for the three months ended ~~September~~June 30, ~~2022~~2023 were ~~$140.7, a decrease~~$132.2, an increase of ~~$20.2~~$29.3 or ~~12.6%~~28.5% as compared to the same period in ~~2021.~~2022. Marketing expenses as a percentage of net sales in the ~~third~~second quarter of ~~2022 decreased~~2023 increased by ~~160~~130 bps to ~~10.7%~~9.1% as compared to ~~12.3%~~7.8% in the same period in ~~2021~~2022 due to ~~150~~200 bps on ~~lower expenses, and 10~~higher expense, as we increased marketing spend as fill rates improved, offset by 70 bps of leverage on higher net sales. Marketing expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 were ~~$345.5, a decrease~~$254.5, an increase of ~~$31.1~~$49.7 or ~~8.3%~~24.3% as compared to the same period in ~~2021.~~2022. Marketing expenses as a percentage of net sales for the first ~~nine~~six months of ~~2022 decreased~~2023 increased by ~~110~~100 bps to 8.8% as compared to ~~9.9%~~7.8% in the same period in ~~2021~~2022 due to 80170 bps on ~~lower expenses and 30~~higher expense, as we increased marketing spend as fill rates improved, offset by 70 bps of leverage on higher net sales.

SG&A expenses were ~~$155.1~~$213.1 in the ~~third~~second quarter of ~~2022,~~2023, an increase of ~~$38.2~~$32.3 or ~~32.7%~~17.9% as compared to the same period in ~~2021.~~2022. SG&A as a percentage of net sales increased ~~280~~100 bps to ~~11.7%~~14.6% in the ~~third~~second quarter of ~~2022~~2023 as compared to ~~8.9%~~13.6% in the same period in ~~2021.~~2022. The increase is due to ~~290~~220 bps on higher expenses, primarily due to the HERO acquisition, higher incentive compensation costs as well as new product and technology investments, offset by 10120 bps of leverage associated with higher sales. The higher expenses for the three-month period ended September 30, 2022 are due to the prior year reduction in the fair value of the Flawless business acquisition liability of $41.0 which reduced SG&A expenses in 2021. SG&A expenses for the first ~~nine~~six months of ~~2022~~2023 were ~~$505.8,~~$420.9, an increase of ~~$102.8~~$70.2 or ~~25.5%~~20.0% as compared to the same period in ~~2021.~~2022. SG&A as a percentage of net sales increased ~~230~~120 bps to ~~12.8%~~14.6% in the first ~~nine~~six months of ~~2022~~2023 compared to ~~10.5%~~13.4% in ~~2021~~2022 due to ~~260~~240 bps on higher expenses, primarily due to the HERO acquisition, higher incentive compensation costs as well as new product and technology investments, offset by 30120 bps of leverage associated with higher sales. The higher expenses for the nine-month period ended September 30, 2022 are primarily due to the prior year reduction in the fair value of the Flawless business acquisition liability of $98.0 which reduced SG&A expenses in 2021.

Other (income) expense, net was nominal for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021.~~2022.

Interest expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 increased ~~$10.3~~$8.6 and ~~$18.1~~$20.8 to ~~$23.7~~$27.9 and ~~$59.6,~~$56.7, respectively, as compared to the same periods in ~~2021,~~2022, primarily due to higher average ~~debt~~interest rates on outstanding ~~and higher interest rates~~debt.

The effective tax rate for the three months ended ~~September~~June 30, ~~2022~~2023 was ~~20.2%~~17.9%, compared to ~~20.4%~~24.1% in the same period in ~~2021.~~2022.

The effective tax rate for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 was ~~22.6%~~21.1%, compared to ~~22.8%~~23.6% in the same period in ~~2021.~~2022.

~~On August 16, 2022, President Biden signed into law~~The decrease in the ~~Inflation Reduction Act of 2022 (the “Act”), which contains provisions effective January 1, 2023, including a 15% corporate minimum~~ tax ~~and a 1% excise~~rate for both periods is primarily due to the tax benefit on higher stock ~~buybacks. While we are still evaluating the impact of the Act, we do not expect any material changes on our consolidated financial position, results of operations and cash flows.~~option exercises.

We operate three reportable segments: Consumer Domestic, Consumer International and SPD. These segments are determined based on differences in the nature of products and organizational structure. We also have a Corporate segment.

The Corporate segment income consists of equity in earnings of affiliates. As of ~~September~~June 30, ~~2022,~~2023, we held 50% ownership interests in each of Armand ~~Products Company (“Armand”)~~ and ~~The~~ ArmaKleen, ~~Company (“ArmaKleen”),~~ respectively. Our equity in earnings of Armand and ArmaKleen, totaling ~~$3.7~~$2.0 and ~~$2.0~~$3.9 for the three months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, respectively, and ~~$10.0~~$6.4 and ~~$7.4~~$6.3 for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, respectively, are included in the Corporate segment. Certain subsidiaries that are included in the Consumer International segment manufacture and sell personal care products to the Consumer Domestic segment.These sales are eliminated from the Consumer International segment results set forth below.

Segment net sales and income before income taxes for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~September~~June 30, ~~2021~~2022 are as follows:


	Three Months Ended				Nine Months Ended				Three Months Ended				Six Months Ended
	September 30,		September 30,		September 30,		September 30,		June 30,		June 30,		June 30,		June 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Household Products	$	592.3	$	535.5	$	1,685.6	$	1,553.7	$	619.2	$	572.8	$	1,220.8	$	1,093.3
Personal Care Products		418.1		462.6		1,324.6		1,346.5		509.0		431.9		1,024.3		906.5
Total Consumer Domestic		1,010.4		998.1		3,010.2		2,900.2		1,128.2		1,004.7		2,245.1		1,999.8
Total Consumer International		219.7		227.0		664.8		670.2		241.9		230.5		472.5		445.1
Total SPD		87.2		86.3		264.6		251.0		84.1		89.9		166.4		177.4
Total Consolidated Net Sales	$	1,317.3	$	1,311.4	$	3,939.6	$	3,821.4	$	1,454.2	$	1,325.1	$	2,884.0	$	2,622.3

Household Products include laundry, deodorizing, and cleaning products. Personal Care Products include condoms, pregnancy kits, oral care products, skin care and hair care products, cold and remedy products, and gummy dietary supplements.

Consumer Domestic net sales in the ~~third~~second quarter of ~~2022~~2023 were ~~$1,010.4,~~$1,128.2, an increase of ~~$12.3~~$123.5 or ~~1.2%~~12.3% as compared to the same period in ~~2021.~~2022. Consumer Domestic net sales for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 were ~~$3,010.2,~~$2,245.1, an increase of ~~$110.0~~$245.3 or ~~3.8%~~12.3% as compared to the same period in ~~2021.~~2022. The components of the net sales change are the following:


	Three Months Ended			Nine Months Ended			Three Months Ended			Six Months Ended
	September 30,			September 30,			June 30,			June 30,
Net Sales - Consumer Domestic	2022			2022			2023			2023
Product volumes sold		(9.7	)%		(6.7	)%		(0.2	%)		(0.6	%)
Pricing/Product mix		8.0	%		7.8	%		6.5	%		6.5	%
Acquired product lines (1)		2.9	%		2.7	%		6.0	%		6.4	%
Net Sales increase		1.2	%		3.8	%		12.3	%		12.3	%

The increase in net sales for the three months ended ~~September~~June 30, ~~2022,~~2023, reflects the impact of the ~~TheraBreath® Acquisition,~~HERO acquisition, and the impact of higher ~~net~~ sales inof THERABREATH® mouth wash, ARM & HAMMER® Cat Litter, ARM & HAMMER® Liquid Detergent, ~~OXICLEAN® Versatile Stain Remover, BATISTE® dry shampoo,~~ and ARM & HAMMER® ~~Cat Litter,~~unit dose laundry detergent partially offset by declines in VITAFUSION® and L’IL CRITTERS® gummy vitamins, FLAWLESS® Hair Removal Products and WATERPIK® Shower Heads. The increase in net sales for the nine-month period ending September 30, 2022, reflects the impact of the TheraBreath® Acquisition, and higher net sales in ARM & HAMMER® Liquid Detergent, OXICLEAN® Powder, ARM & HAMMER® Cat Litter, and BATISTE® dry shampoo, offset by declines inFINISHING TOUCH FLAWLESS® Hair Removal Products, WATERPIK® Shower Heads and FIRST RESPONSE®. The increase in net sales for the six-month period ending June 30, 2023, reflects the impact of the HERO acquisition, and the impact of higher sales of THERABREATH® mouth wash, ARM & HAMMER® Liquid Detergent, ARM & HAMMER® Cat Litter, and BATISTE® Dry Shampoo partially offset by declines in WATERPIK® Shower Heads, VITAFUSION® and L’IL CRITTERS® gummy ~~vitamins.~~vitamins, and FINISHING TOUCH FLAWLESS® Hair Removal Products.

Recently, the Company’s global FLAWLESS business has experienced declining customer demand for many of its products, primarily due to lower consumer spending for discretionary products from inflation. In addition, the FLAWLESS business has also started to experience margin contraction as the Company has been unable to implement price increases in a highly competitive category to offset higher labor, material and transportation costs. These factors have resulted in a reduction in expected future cash flows that, if these factors persist or continue to worsen, may result in cash flows that are not sufficient to recover the carrying value of the long-lived assets of the business. The projected cash flows exceed the carrying value of the long lived assets by slightly more than 10%. The key assumptions used to determine the projected cash flows include revenue, gross margin and marketing expense assumptions based on recent trends, including the reduction in customer demand for discretionary products and declining gross margins that FLAWLESS has been experiencing. The carrying value of the long-lived assets for the FLAWLESS business is approximately $465.0 at September 30, 2022. These assets are being amortized over their remaining weighted average life of 16 years. The long-lived assets of the FLAWLESS business are susceptible to impairment risk based on the factors described above. While management can and has implemented strategies to address the risk, including lowering the Company’s production costs, investing in new product ideas, and developing new creative advertising, significant adverse changes in demand, operating plans or economic factors in the future could reduce the underlying cash flows that could trigger a future impairment charge.

In recent years our TROJAN business, specifically the condom category, has not grown and competition has increased. Social distancing requirements due to the COVID-19 pandemic had further negatively impacted the business. As a result, the TROJAN business had experienced stagnant sales and profits resulting in a reduction in expected future cash flows which eroded a portion of the excess between the fair and carrying value of the tradename. This indefinite-lived intangible asset may be susceptible to impairment risk and a continued decline in fair value could trigger a future impairment charge of the TROJAN tradename. While management has implemented strategies to address the risk, including lowering our production costs, investing in new product ideas, and developing new creative advertising, significant changes in operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate fair value. More recently, TROJAN has experienced a recovery in sales and profits as it has benefited from an easing of COVID-19 social restrictions which led to an increase in sexual activity. We expect this trend will continue with the adoption of vaccines, the reduction of social distancing restrictions and the benefit of management strategies to improve sales and profitability.

Consumer Domestic income before income taxes for the ~~third~~second quarter of ~~2022~~2023 was ~~$193.9,~~$230.7, a ~~$44.7 decrease~~$29.0 increase as compared to the ~~third~~second quarter of ~~2021.~~2022. The ~~decrease~~increase is due primarily to favorable price/mix of $66.6 and the ~~impact~~gross margin benefit of ~~lower~~higher sales volumes related to the HERO acquisition of ~~$52.0,~~$34.6, offset by higher marketing expenses of $30.5, higher SG&A expenses of $30.2, higher interest and other expenses of $6.9 and higher manufacturing and distribution expenses of ~~$35.2,~~$4.6. For the six-month period ended June 30, 2023, income before income taxes was $459.4, a $35.0 increase as compared to the first six months of 2022. The increase is due primarily to favorable price/mix of $122.3 and the gross margin benefit of higher sales volumes related to the HERO acquisition of $61.4, offset by higher SG&A expenses of ~~$31.2 (due to~~ ~~the prior year reduction in the fair value~~$66.2, higher marketing expenses of ~~the~~ ~~Flawless business acquisition liability of $34.8), and~~$49.7, higher interest and other expenses of ~~$7.9, partially offset by a favorable price/mix of $65.9~~ $16.7 and ~~lower marketing expenses of $14.7. For the nine-month period ended September 30, 2022, income before income taxes was $618.3, a $95.4 decrease as compared to the first nine months of 2021. The decrease is due primarily to~~ higher manufacturing and distribution expenses of ~~$127.2, higher SG&A expenses of $83.5 (due to~~ $16.2.~~the prior year reduction in the fair value of the~~ ~~Flawless business acquisition liability of $83.2), the impact of lower sales volumes of $80.6, and higher interest and other expenses of~~ ~~$14.7, partially offset by a favorable price/mix of $186.4 and lower marketing expenses of $22.8~~.

Consumer International net sales were ~~$219.7~~$241.9 in the ~~third~~second quarter of ~~2022, a decrease~~2023, an increase of ~~$7.3~~$11.4 or ~~3.2%~~4.9% as compared to the same period in ~~2021.~~2022. Consumer International net sales in the first ~~nine~~six months of ~~2022~~2023 were ~~$664.8, a decrease~~$472.5, an increase of ~~$5.4~~$27.4 or ~~0.8%~~6.2% as compared to the same period in ~~2021.~~2022. The components of the net sales change are the following:


	Three Months Ended			Nine Months Ended			Three Months Ended			Six Months Ended
	September 30,			September 30,			June 30,			June 30,
Net Sales - Consumer International	2022			2022			2023			2023
Product volumes sold		(3.0	)%		(1.0	)%		0.6	%		3.6	%
Pricing/Product mix		6.2	%		4.4	%		5.5	%		5.3	%
Foreign exchange rate fluctuations		(7.1	)%		(5.0	)%		(1.2	%)		(2.7	%)
Acquired product lines (1)		0.7	%		0.8	%
Net Sales decrease		(3.2	)%		(0.8	)%
Net Sales increase								4.9	%		6.2	%

Excluding the impact of foreign exchange rates, sales ~~were higher~~growth in the ~~third~~second quarter ended ~~September~~June 30, ~~2022 for BATISTE, FLAWLESS, and FIRST RESPONSE in Australia, STERIMAR and TROJAN in Mexico,~~2023 is driven by WATERPIK, THERABREATH, and BATISTE in GMG, BATISTE and STERIMAR in Europe, BATISTE and OXICLEAN in Canada, and ~~Europe.~~STERIMAR, A&H DENTAL CARE, and BAKING SODA in Mexico. The increase in net sales for the ~~nine-month~~six-month period ending ~~September 30, 2022~~June 30,2023, is driven by ~~CURASH~~BATISTE, THERABREATH, FEMFRESH, and OXICLEAN in GMG, BATISTE, GRAVOL, THERABREATH, and OXICLEAN in ~~Australia,~~Canada, BATISTE ~~STERIMAR, and ARM & HAMMER Dental Care in Europe, VMS, BATISTE, OXICLEAN,~~ and STERIMAR in ~~GMG,~~Europe, and ~~CAT LITTER, GRAVOL,~~STERIMAR and ~~VMS~~A&H Dental CARE in ~~Canada.~~Mexico.

Recently, the Company’s global FLAWLESS business has experienced declining customer demand for many of its products, primarily due to lower consumer spending for discretionary products from inflation. In addition, the FLAWLESS business has also started to experience margin contraction as the Company has been unable to implement price increases in a highly competitive category to offset higher labor, material and transportation costs. These factors have resulted in a reduction in expected future cash flows that, if these factors persist or continue to worsen, may result in cash flows that are not sufficient to recover the carrying value of the long-lived assets of the business. The projected cash flows exceed the carrying value of the long lived assets by slightly more than 10%. The key assumptions used to determine the projected cash flows include revenue, gross margin and marketing expense assumptions based on recent trends, including the reduction in customer demand for discretionary products and declining gross margins that FLAWLESS has been experiencing. The carrying value of the long-lived assets for the FLAWLESS business is approximately $465.0 at September 30, 2022. These assets are being amortized over their remaining weighted average life of 16 years. The long-lived assets of the FLAWLESS business are susceptible to impairment risk based on the factors described above. While management can and has implemented strategies to address the risk, including lowering the Company’s production costs, investing in new product ideas, and developing new creative advertising, significant adverse changes in demand, operating plans or economic factors in the future could reduce the underlying cash flows that could trigger a future impairment charge.

Consumer International income before income taxes was ~~$22.7~~$27.5 in the ~~third~~second quarter of ~~2022, an $11.8~~2023, a $1.0 decrease as compared to the ~~third~~second quarter of ~~2021.~~2022. Higher manufacturing and commodity costs of ~~$11.2,~~$9.8, higher SG&A expenses of $7.8 (primarily due to the prior year reduction in fair value of the Flawless business acquisition liability of $6.2), the impact of lower sales volumes of $3.1, unfavorable foreign exchange rates of $2.1, and$4.2, higher interest and other expenses of ~~$1.8,~~$0.5 and unfavorable foreign exchange rates of $0.1, were ~~partially~~ offset by a favorable price/mix of ~~$11.1~~$12.2, the impact of higher sales volumes of $0.7 and lower marketing expenses of ~~$3.0.~~$0.6. For the first ~~nine~~six months of ~~2022,~~2023, income before income taxes was ~~$80.8,~~$56.4, an ~~$30.1~~$1.7 decrease as compared to the same period in ~~2021.~~2022. Higher manufacturing and commodity costs of ~~$21.3,~~$20.9, higher SG&A expenses of ~~$18.5 (primarily due to the prior year reduction in fair value of the Flawless business acquisition liability of $14.8),~~$6.5, unfavorable foreign exchange rates of ~~$6.2, the impact of lower sales volumes of $2.8, and~~$1.7, higher interest and other expenses of ~~$2.1,~~$1.2 and higher marketing expenses of $0.1, were ~~partially~~ offset by a favorable price/mix of ~~$17.0~~$21.2 and ~~lower marketing expenses~~the impact of ~~$3.6.~~higher sales volumes of $7.5.

SPD net sales were ~~$87.2~~$84.1 in the ~~third~~second quarter of ~~2022, an increase~~2023, a decrease of ~~$0.9~~$5.8 or ~~1.0%~~6.5% as compared to the same period in ~~2021.~~2022. SPD net sales were ~~$264.6~~$166.4 for the first ~~nine~~six months of ~~2022, an increase~~2023, a decrease of ~~$13.6,~~$11.0, or ~~5.4%~~6.2% as compared to the same period in ~~2021.~~2022. The components of the net sales change are the following:


	Three Months Ended			Nine Months Ended			Three Months Ended			Six Months Ended
	September 30,			September 30,			June 30,			June 30,
Net Sales - SPD	2022			2022			2023			2023
Product volumes sold		(8.5	)%		(5.0	)%		(4.2	%)		(5.8	%)
Pricing/Product mix		9.5	%		10.4	%		(2.3	%)		(0.4	%)
Net Sales increase		1.0	%		5.4	%
Net Sales decrease								(6.5	%)		(6.2	%)

Net sales ~~increased~~decreased in the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 primarily due to ~~higher pricing in~~competitive imports within our domestic dairy ~~and specialty chemicals segments in response to rising costs.~~business.

SPD income before income taxes was ~~$14.2~~$9.2 in the ~~third~~second quarter of ~~2022, flat~~2023, a decrease of $3.2 as compared to the same period in ~~2021~~2022 due to ~~favorable~~unfavorable price/product mix of ~~$8.2, lower~~$2.1, higher SG&A expenses and other expenses of ~~$0.6,~~$2.1, and lower volumes of $1.1, partially offset by favorable manufacturing costs of $1.4, and lower marketing costs ~~of $0.2, offset by unfavorable manufacturing costs of $5.5, lower volumes of $2.9, and higher other expenses~~ of $0.6. SPD income before income taxes was ~~$38.1~~$16.0 in the first ~~nine~~six months of ~~2022, an increase~~2023, a decrease of ~~$2.5~~$7.9 as compared to the same period in ~~2021~~2022 due primarily to ~~favorable~~higher SG&A and other costs of $4.7, lower volumes of $3.0, unfavorable price/~~product~~ mix of ~~$23.7,~~$0.7, partially offset by ~~unfavorable~~favorable manufacturing costs of ~~$19.6, higher other expenses of $1.4, higher SG&A costs of $0.2, and higher marketing expenses of $0.1.~~$0.5.

The Corporate segment includes equity in earnings of affiliates from Armand and ArmaKleen in the three and ~~nine~~six months of ~~2022~~2023 and ~~2021.~~2022. The Corporate segment income before income taxes was ~~$3.7~~$2.0 in the ~~third~~second quarter of ~~2022,~~2023, as compared to ~~$2.0~~$3.9 in the same period in ~~2021.~~2022. The Corporate segment income before income taxes was ~~$10.0~~$6.4 for the first ~~nine~~six months of ~~2022,~~2023, as compared to ~~$7.4~~$6.3 in the same period in ~~2021.~~2022.

On June 16, 2022, we entered into a credit agreement (the “Credit Agreement”) that provides for our $1,500.0 unsecured revolving credit facility (the “Revolving Credit Facility”) that matures on June 16, 2027, unless extended. The Credit Agreement replaced our prior credit agreement that was entered into on March 29, 2018 which included a $1,000.0 unsecured revolving credit facility maturing on March 29, ~~2024 that was entered into on March 29, 2018.~~2024. We ~~continue to~~ have the ability to increase our borrowing up to an additional $750.0, subject to lender commitments and certain conditions as described in the Credit Agreement. Borrowings under the Credit Agreement are available for general corporate purposes and are used to support our ~~$1,000.0~~$1,500.0 commercial paper program.

As of ~~September~~June 30, ~~2022,~~2023, we had ~~$437.6~~$396.9 in cash and cash equivalents, and approximately ~~$1,496.0~~$1,495.0 available through the Revolving Credit Facility and our commercial paper program. To preserve our liquidity, we invest cash primarily in government money market funds, prime money market funds, short-term commercial paper and short-term bank deposits.

~~On June 2, 2022,~~In the first quarter of 2023, we issued $500.0 aggregate principal amount of 5.00% Senior Notes due 2052 (the “2052 Notes”). The 2052 Notes were issued under the second supplemental indenture (the “Second Supplemental Indenture”), dated June 2, 2022, to the indenture dated December 10, 2021 (the “Indenture”). ~~In July 2022 a portion of the proceeds from the sale of the Notes were used to repay all~~repaid $200.0 of our ~~outstanding $300.0 2.45% Senior Notes~~$400.0 Term Loan due ~~August 1, 2022.~~ December 22, 2024 with cash on hand and commercial paper borrowings.~~The 2052 Notes will mature on June 15, 2052, unless earlier retired or redeemed pursuant to the terms of the Second Supplemental Indenture.~~

In October 2022, we repaid all of the outstanding $400.0 2.875% Senior notes due October 1, 2022 with a portion of the proceeds from the 5.00% Senior notes issued on June 2, 2022 and due June 15, 2052 and cash on hand.

The current economic environment presents risks that could have adverse consequences for our liquidity. See “Unfavorable economic conditions could adversely affect demand for our products” under “Risk Factors” in Item 1A of our ~~Annual Report on~~ Form ~~10-K for the fiscal year ended December 31, 2021 (the “Form 10-K”).~~10-K. We continue to manage all aspects of our business including, but not limited to, monitoring the financial health of our customers, suppliers and other third-party relationships, implementing gross margin enhancement strategies and developing new opportunities for growth. We do not anticipate that current economic conditions will adversely affect our ability to comply with the financial covenant in the Credit Agreement because we currently are, and anticipate that we will continue to be, in compliance with the ~~maximum leverage ratio requirement~~requirements under the Credit Agreement.

On October 28, 2021, the Board authorized a ~~new~~ share repurchase program, under which we may repurchase up to $1,000.0 in shares of Common Stock (the “2021 Share Repurchase Program”). The 2021 Share Repurchase Program does not have an expiration and replaced the 2017 Share Repurchase Program. ~~All remaining dollars authorized for repurchase under the 2017 Share Repurchase Plan have been cancelled.~~ The 2021 Share Repurchase Program did not modify our evergreen share repurchase program, authorized by the Board on January 29, 2014, under which we may repurchase, from time to time, Common Stock to reduce or eliminate dilution associated with issuances of Common Stock under its incentive plans.

In December 2021, we executed open market purchases of 1.8 million shares for $170.3, inclusive of fees, of which $100.0 was purchased under the evergreen share repurchase program and $70.3 was purchased under the 2021 Share Repurchase Program. In December 2021, we also entered into an accelerated share repurchase ("ASR") contract with a commercial bank to purchase Common Stock. We paid $200.0 to the bank, inclusive of fees, and received an initial delivery of shares equal to $180.0, or 1.8 million. We used cash on hand and short-term borrowings to fund the initial purchase price. Upon the completion of the ASR, which ended in February 2022, the bank delivered an additional 0.2 million shares. The final shares delivered to us were determined by the average price per share paid by the bank during the purchase period. All 2.0 million shares were purchased under the 2021 Share Repurchase Program.

As ~~a result~~ of ~~our recent stock repurchases,~~June 30, 2023, there remains $729.7 of share repurchase availability under the 2021 Share Repurchase ~~Program as of September 30, 2022.~~Program.

On ~~January 28, 2022,~~February 1, 2023, the Board declared a 4% increase in the regular quarterly dividend from ~~$0.2525~~$0.2625 to ~~$0.2625~~$0.2725 per share, equivalent to an annual dividend of ~~$1.05~~$1.09 per ~~share.~~share payable to stockholders of record as of February 15, 2023. The increase raises the annual dividend payout from ~~$248.0~~$255.0 to approximately ~~$255.0. For the three and nine months ended September 30, 2022, we paid dividends of $63.8 and $191.2, respectively.~~$265.0.

We anticipate that our cash from operations, together with our current borrowing capacity, will be sufficient to fund our share repurchase programs, ~~to the extent implemented by management,~~ pay debt and interest as it comes due, ~~and pay~~fund dividends, ~~at the latest approved rate,~~ and meet our capital expenditure program ~~costs, which~~costs. Capital expenditures in 2023 are expected to be approximately ~~$170.0 in 2022~~$250.0 primarily for manufacturing capacity investments in laundry, litter and ~~litter~~vitamins to support expected future sales growth. Cash, together with our current borrowing capacity, may be used for acquisitions that would complement our existing product lines or geographic markets.


	Nine Months Ended						Six Months Ended
	September 30,			September 30,			June 30,			June 30,
	2022			2021			2023			2022
Net cash provided by operating activities	$	534.1		$	653.6		$	509.2		$	310.4
Net cash used in investing activities	$	(100.7	)	$	(69.7	)	$	(69.2	)	$	(39.8	)
Net cash used in financing activities	$	(226.0	)	$	(585.4	)	$	(315.4	)	$	132.2

Net Cash Provided by Operating Activities – Our primary source of liquidity is the cash flow provided by operating activities, which is dependent on net income and changes in working capital. Our net cash provided by operating activities in the ~~nine~~six months ended ~~September~~June 30, ~~2022 decreased~~2023 increased by ~~$119.5~~$198.8 to ~~$534.1~~$509.2 as compared to ~~$653.6~~$310.4 in the same period in ~~2021~~2022 due to an ~~increase~~improvement in working capital and ~~lower~~an increase in cash earnings (net income adjusted for non-cash items). including the impact of recent acquisitions. The ~~increase~~improvement in working capital is primarily related to ~~higher~~lower investment in inventory ~~levels~~ for ~~Waterpik and Vitamins as well as raw materials to ensure adequate supply.~~our discretionary brands. We measure working capital effectiveness based on our cash conversion cycle. The following table presents our cash conversion cycle information for the quarters ended ~~September~~June 30, ~~2022~~2023 and ~~2021:~~2022:

Our cash conversion cycle (defined as the sum of DSO and DIO less DPO) which is calculated using a two-period average method, increased 5four days from the prior ~~year as higher~~year. The decrease in DPO is a result of the timing of inventory ~~levels~~purchase for ~~Waterpik~~most of our brands and ~~Vitamins, as well as raw materials, offset the benefit of payment term extensions.~~a reduction in inventory purchases related to our discretionary brands. We continue to focus on reducing our working capital requirements.

Net Cash Used in Investing Activities – Net cash used in investing activities during the first ~~nine~~six months of ~~2022~~2023 was ~~$100.7,~~$69.2, primarily reflecting ~~$98.1~~$63.2 for property, plant and equipment additions. Net cash used in investing activities during the first ~~nine~~six months of ~~2021~~2022 was ~~$69.7,~~$39.8, primarily reflecting ~~$64.1~~$38.8 for property, plant and equipment additions.

Net Cash Used in Financing Activities – Net cash used in financing activities during the first ~~nine~~six months of ~~2022~~2023 was ~~$226.0~~$315.4 reflecting ~~$191.2~~$270.6 of net debt payments and $133.0 of cash dividend payments, ~~$49.7 of net debt repayments, and $7.5 of deferred financing costs,~~ partially offset by ~~$22.4~~$88.3 of proceeds from stock option exercises. Net cash ~~used in~~provided by financing activities during the first ~~nine~~six months of ~~2021~~2022 was ~~$585.4,~~$132.2 reflecting ~~$371.6~~$250.3 of net debt ~~payments, $185.8~~borrowings, and $16.9 of proceeds from stock option exercises, less $127.4 of cash dividend payments and ~~$54.9~~$7.6 of ~~treasury stock purchases, partially offset by $26.9 of proceeds from stock option exercises.~~deferred financing costs.

For quantitative and qualitative disclosures about market risk affecting the Company, see “Quantitative and Qualitative Disclosures About Market Risk” in Item 7A of Part II in the Form 10-K.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) at the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this report, are effective to provide reasonable assurance that the information required to be disclosed by the Company in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the United States Securities and Exchange Commission (the “Commission”), and (ii) accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding the disclosure.

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurring during the Company’s most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

This report contains forward-looking statements, including, among others, statements relating to net sales and earnings growth; ~~the impact of the COVID-19 pandemic and the Company’s response;~~ gross margin changes; trade, marketing and ~~marketing~~SG&A spending; marketing expense as a percentage of net sales; sufficiency of cash flows from operations; earnings per share; the impact of new accounting pronouncements; cost savings programs; recessionary ~~conditions,~~conditions; interest rates; inflation; consumer demand and spending; the effects of competition; the effect of product mix; volume growth, including the effects of new product launches into new and existing categories; the decline of condom usage; the Company’s hedge programs; the impact of foreign exchange, ~~tariffs,~~ and commodity price fluctuations; impairments and other charges; the Company’s investments in joint ventures; the impact of acquisitions (including earn-outs) and divestitures; capital expenditures; the Company’s effective tax rate; the impact of tax audits; tax ~~changes and the lapse of applicable statutes of limitations;~~changes; the effect of the credit environment on the Company’s liquidity and capital

resources; the Company’s fixed rate debt; compliance with covenants under the Company’s debt instruments; the Company’s commercial paper program; the Company’s current and anticipated future borrowing capacity to meet capital expenditure program costs; ~~and~~ the Company’s share repurchase programs; payment of dividends; environmental and regulatory matters; the availability and adequacy of raw materials, including trona reserves and the conversion of such reserves; and the customers and consumer acceptance of certain ingredients in our products. Other forward-looking statements in this report are generally identified by the use of such terms as “may,” “could,” “expect,” “intend,” “believe,” “plan,” “estimate,” “forecast,” “project,” “anticipate,” “to be,” “to make” or other comparable terms. These statements represent the intentions, plans, expectations and beliefs of the Company, and are based on assumptions that the Company believes are reasonable but may prove to be incorrect. In addition, these statements are subject to risks, uncertainties and other factors, many of which are outside the Company’s control and could cause actual results to differ materially from such forward-looking statements. Factors that could cause such differences include a decline in market growth, retailer distribution and consumer demand (as a result of, among other things, political, economic and marketplace conditions and events), including those relating to the outbreak of contagious diseases; other impacts of the COVID-19 pandemic and its impact on the Company’s operations, customers, suppliers, employees, and other constituents, and market volatility and impact on the economy (including ~~causing~~contributions to recessionary conditions), resulting from global, nationwide or local or regional outbreaks or increases in infections, new variants, and the risk that the Company will not be able to successfully execute its response plans with respect to the pandemic or localized outbreaks and the corresponding uncertainty; the impact of regulatory changes or policies associated with the COVID-19 pandemic, including continuing or renewed shutdowns of retail and other businesses in various jurisdictions; the impact of new legislation such as the U.S. CARES Act, the EU Medical Device Regulation, new cosmetic and ~~other governmental actions;~~device regulations in Mexico, and the U.S. Modernization of Cosmetic Regulation Act; the impact on the global economy of the ~~military conflict between Russia and~~ Russia/Ukraine war, including the impact of export controls and other economic sanctions; potential recessionary conditions or economic uncertainty; the impact of continued shifts in consumer behavior, including accelerating shifts to on-line shopping; unanticipated increases in raw material and energy prices, including as a result of the ~~military conflict between Russia and Ukraine;~~Russia/Ukraine war or other inflationary pressures; delays and increased costs in manufacturing and distribution; increases in transportation costs; labor shortages; the impact of price increases for our products; the impact of inflationary conditions; the impact of supply chain and labor disruptions; the impact of severe or inclement weather on raw material and transportation costs; adverse developments affecting the financial condition of major customers and suppliers; competition; changes in marketing and promotional spending; growth or declines in various product categories and the impact of customer actions in response to changes in consumer demand and the economy, including increasing shelf space or on-line share of private label and retailer-branded products or other changes in the retail environment; consumer and competitor reaction to, and customer acceptance of, new product introductions and features; the Company’s ability to maintain product quality and characteristics at a level acceptable to our customers and consumers; disruptions in the banking system and financial markets; the Company’s borrowing capacity and ability to finance its operations and potential acquisitions; higher interest rates; foreign currency exchange rate fluctuations; implications of the United Kingdom’s withdrawal from the European Union; transition to, and shifting economic policies in the United States; potential changes in export/import and trade laws, regulations and policies of the United States and other countries, including any increased trade restrictions or ~~tariffs, including the actual and potential effect of tariffs on Chinese goods imposed by the United States;~~tariffs; increased or changing regulation regarding the Company’s products and its suppliers in the United States and other countries where it or its suppliers operate; market volatility; issues relating to the Company’s information technology and controls; the impact of natural disasters, including those related to climate change, on the Company and its customers and suppliers, including third party information technology service providers; integrations of acquisitions or divestiture of assets; the outcome of contingencies, including litigation, pending regulatory proceedings and environmental matters; and changes in the regulatory ~~environment.~~environment in the countries where we do business.

The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the United States federal securities laws. You are advised, however, to

consult any further disclosures the Company makes on related subjects in its filings with the United States Securities and Exchange Commission (the “Commission”).

The Company, in the ordinary course of its business, is subject of, or party to, various pending or threatened legal actions, government investigations and proceedings from time to time, including, without limitation, those relating to commercial transactions, product liability, purported consumer class actions, employment matters, antitrust, environmental, health, safety and other compliance related matters. Such proceedings are subject to many uncertainties and the outcome of certain pending or threatened legal actions may not be reasonably predictable and any related damages may not be estimable. Certain legal actions could result in an adverse outcome for us, and any such adverse outcome could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Item 1A, “Risk Factors” in the Form 10-K, which could materially affect the Company’s business, financial condition or future results.

The Company repurchases shares of its Common Stock from time to time pursuant to its publicly announced share repurchase programs.

During the ~~third~~second quarter of ~~2022~~2023 the Company did not repurchase any shares of Common Stock pursuant to its share repurchase programs.

~~On October 28, 2021,~~ The following table contains information for shares repurchased during the ~~Board authorized a new share repurchase program under~~second quarter of 2023, which ~~the Company may purchase up~~was solely due to ~~$1,000.0 in~~ shares of Common Stock (the “2021 Share Repurchase Program”). The 2021 Share Repurchase Program does not have an expiration and replaces the Company’s 2017 Share Repurchase Program. All remaining dollars authorized for repurchase under the 2017 Share Repurchase Plan have been cancelled. The 2021 Share Repurchase Program does not modify the Company’s evergreen share repurchase program, authorizedwithheld by the ~~Board on January 29, 2014, under which~~Company to satisfy tax withholding obligations in connection with the ~~Company may repurchase, from time to time, Common Stock to reduce or eliminate dilution associated with issuances~~vesting of ~~Common Stock under its incentive plans.~~

In December 2021, the Company executed open market purchases of 1.8 million shares for $170.3, inclusive of fees, of which $100.0 was purchased under the evergreen share repurchase program and $70.3 was purchased under the 2021 Share Repurchase Program. In December 2021, the Company also entered into an accelerated share repurchase ("ASR") contract with a commercial bank to purchase Common Stock. The Company paid $200.0 to the bank, inclusive of fees, and received an initial delivery of shares equal to $180.0, or 1.8 million shares. The Company used cash on hand and short-term borrowings to fund the initial purchase price. Upon the completion of the ASR, which ended in February 2022, the bank delivered an additional 0.2 million shares to the Company. The final shares delivered to the Company were determined by the average price per share paid by the bank during the purchase period. All 2.0 million shares were purchased under the ~~2021 Share Repurchase Program~~.restricted stock.

As a result of the Company’s ~~recent~~ stock repurchases, there remains $729.7 of share repurchase availability under the 2021 Share Repurchase Program as of ~~September~~June 30, ~~2022.~~2023.

~~Sales~~Securities Trading Plans of ~~Unregistered Securities~~Directors and Executive Officers

During the ~~Company entered into an Agreement and Plan~~three months ended June 30, 2023, none of ~~Merger (the “Hero Merger Agreement”) pursuant to which~~our directors or executive officers adopted or terminated any contract, instruction or written plan for the ~~Company agreed to acquire all~~purchase or sale of the issued and outstanding shares of capital stock of Hero Cosmetics, Inc., the developer of the Hero Mighty Patch® brand and other acne treatment products (the “Hero Acquisition”). The total consideration related to the Hero Acquisition, which is subject to adjustment, consists of approximately $565.0 million of cash (of which $8.0 million will be held back for five yearsAAG securities that was intended to satisfy ~~certain indemnification obligations) and approximately $65.0 million~~the affirmative defense conditions of restricted shares of the Company's common stock which will be recognized as compensation expense as the stock is subject to vesting requirements for individuals who will continue to be employed by the Company. The Hero Acquisition closed on October 13, 2022 and was financed with cash on hand and commercial paper borrowings. The Company issued an aggregate of 854,882 shares of restricted stock in the transaction which was exempt from registration by Section 4(a)(2) of the Securities Act of 1933, as amended and Regulation D thereunder.Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	September 30,		December 31,		June 30,		December 31,
	2022		2021		2023		2022
Land	$	28.1	$	28.3	$	28.3	$	28.1
Buildings and improvements		292.2		290.8		305.8		299.1
Machinery and equipment		851.9		828.9		879.9		856.5
Software		110.6		107.8		117.5		109.1
Office equipment and other assets		93.8		92.7		103.3		96.9
Construction in progress		175.7		104.3		240.7		211.5
Gross PP&E		1,552.3		1,452.8		1,675.5		1,601.2
Less accumulated depreciation and amortization		836.0		800.1		873.1		840.1
Net PP&E	$	716.3	$	652.7	$	802.4	$	761.1


	Notional		Notional		Notional		Notional
	Amount		Amount		Amount		Amount
	September 30, 2022		December 31, 2021		June 30, 2023		December 31, 2022
Derivatives designated as hedging instruments
Foreign exchange contracts	$	219.9	$	216.3	$	217.8	$	231.5
Interest rate lock agreements	$	500.0	$	300.0
Diesel fuel contracts	3.9 gallons		0.0 gallons		4.0 gallons		5.0 gallons
Commodities contracts	8.6 pounds		72.1 pounds		12.2 pounds		26.8 pounds
Derivatives not designated as hedging instruments
Foreign exchange contracts	$	5.9	$	5.9	$	1.6	$	1.6
Equity derivatives	$	23.8	$	28.9	$	20.6	$	22.5


	September 30,		December 31,		June 30,		December 31,
	2022		2021		2023		2022
Trade accounts payable	$	655.6	$	663.8	$	677.7	$	666.7
Accrued marketing and promotion costs		196.3		201.6		225.3		234.4
Accrued wages and related benefit costs		52.5		87.7		78.1		66.8
Other accrued current liabilities		127.6		166.6		129.0		134.9
Total	$	1,032.0	$	1,119.7	$	1,110.1	$	1,102.8


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐


Inventory and other working capital	$	40.2
Property, plant and equipment		0.5
Trade name		367.8
Other intangible assets		93.8
Goodwill		152.2
Current liabilities		(13.1	)
Deferred income taxes		(108.0	)
Long-term liabilities		(20.7	)
Cash purchase price (net of cash acquired)	$	512.7


	Armand				ArmaKleen				Armand				ArmaKleen
	Nine Months Ended				Nine Months Ended				Six Months Ended				Six Months Ended
	September 30,		September 30,		September 30,		September 30,		June 30,		June 30,		June 30,		June 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Purchases by Company	$	10.9	$	9.8	$	0.0	$	0.0	$	7.6	$	6.7	$	0.0	$	0.0
Sales by Company	$	0.0	$	0.0	$	0.6	$	0.8	$	0.0	$	0.0	$	0.6	$	0.3
Outstanding Accounts Receivable	$	0.5	$	0.4	$	0.9	$	0.5	$	0.4	$	0.6	$	1.4	$	1.0
Outstanding Accounts Payable	$	1.6	$	1.4	$	0.0	$	0.0	$	1.6	$	1.9	$	0.0	$	0.0
Administration & Management Oversight Services (1)	$	1.7	$	1.6	$	1.5	$	1.5	$	1.1	$	1.1	$	1.0	$	1.0


	As of
	September 30, 2022		September 30, 2021		Change
Days of sales outstanding in accounts receivable ("DSO")		27		28		(1	)
Days of inventory outstanding ("DIO")		79		68		11
Days of accounts payable outstanding ("DPO")		78		73		(5	)
Cash conversion cycle		28		23		5


Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under All Programs
4/1/2023 to 4/30/2023		391	$	83.63		-	$	729,727,297
5/1/2023 to 5/31/2023		381		94.79		-	$	729,727,297
6/1/2023 to 6/30/2023		438		94.10		-	$	729,727,297
Total		1,210	$	90.93		-



	(3.1)	Amended and Restated Certificate of Incorporation of the Company, incorporated by reference to Exhibit 3.1 to the Company’s quarterly report on Form 10-Q filed on June 30, 2020.

	(3.2)	Amendment to the Company’s Amended and Restated Certificate of Incorporation, incorporated by reference to Exhibit 3.1 to the Company’s current report on Form 8-K filed on April 30, 2021.

	~~(10.4)~~		(3.3)	~~First Amendment to Credit Agreement dated June 16,~~By-laws of the Company, amended and restated as of December 23, 2022, ~~among Church & Dwight Co., Inc., the lenders named therein, and Bank of America, N.A., as administrative agent,~~ incorporated by reference to Exhibit ~~10.2~~3.1 to the Company’s current report on Form 8-K filed on ~~June 21, 2022~~December 23, 2022..

	(31.1)	Certification of the Chief Executive Officer of the Company pursuant to Rule 13a-14(a) under the Securities Exchange Act.

	(31.2)	Certification of the Chief Financial Officer of the Company pursuant to Rule 13a-14(a) under the Securities Exchange Act.

	(32.1)	Certification of the Chief Executive Officer of the Company pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. Section 1350.

	(32.2)	Certification of the Chief Financial Officer of the Company pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. Section 1350.

	(101.INS)	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

	(101.SCH)	Inline XBRL Taxonomy Extension Schema Document.
	(101.CAL)	Inline XBRL Taxonomy Extension Calculation Linkbase Document.

	(101.DEF)	Inline XBRL Taxonomy Extension Definition Linkbase Document.
	(101.LAB)	Inline XBRL Taxonomy Extension Label Linkbase Document.

	(101.PRE)	Inline XBRL Taxonomy Extension Presentation Linkbase Document.

	(104)	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)


			CHURCH & DWIGHT CO., INC.
			(REGISTRANT)

DATE:	~~October 28, 2022~~	July 28, 2023		/s/ Richard A. Dierker
			RICHARD A. DIERKER
			Executive Vice President
			and Chief Financial Officer
			(Principal Financial Officer)

DATE:	~~October 28, 2022~~	July 28, 2023		/s/ Joseph J. Longo
			JOSEPH J. LONGO
			VICE PRESIDENT AND
			CONTROLLER
					(PRINCIPAL ACCOUNTING OFFICER)