| The Clorox Company |  | |
SupplementalInformation –VolumeGrowth
| % Change vs. Prior Year | ||||||||||
| Business Segment | FY08 | FY09 | MajorDrivers ofChange | |||||||
| Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | YTD | ||
| North America(1) | 5% | 6% | 4% | 6% | 5% | 4% | -2% | -4% | -1% | Q3decrease wasprimarily the result of thecompany’s exit from the private-label food bagsbusiness, and the impact ofcalendar year 2008 priceincreases onshipments of Glad®trash bags,cleaningproducts andseveral otherbrands. These results werepartially offset by all-time recordshipments ofHidden Valley®saladdressing, and highershipments of Brita®water-filtrationproducts, Clorox 2®stain fighter and colorbooster, andKingsford®charcoalproducts. |
| International | 11% | 6% | 4% | 7% | 7% | 5% | 4% | 2% | 3% | Q3increaseprimarily driven byincreasedshipments oflaundry andhomecareproducts in LatinAmerica. |
| Total Company | 6% | 6% | 4% | 6% | 6% | 4% | -1% | -3% | 0% | |
SupplementalInformation –SalesGrowth
| % Change vs. Prior Year | ||||||||||
| Business Segment | FY08 | FY09 | MajorDrivers ofChange | |||||||
| Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | YTD | ||
| North America(1) | 5% | 6% | 8% | 10% | 8% | 11% | 3% | 0% | 5% | Q3 sales outpaced the change in volume primarily due to the benefit of price increases, partially offset by the impact of unfavorable Canadian currency exchange rates. |
| International | 18% | 17% | 14% | 16% | 16% | 14% | 0% | -1% | 4% | Q3 sales lagged volume growth primarily due to the impact of unfavorable foreign exchange rates. |
| Total Company | 7% | 8% | 9% | 11% | 9% | 12% | 3% | 0% | 5% | |
| (1) | North America includes U.S. and Canadian results and the worldwide Burt’s Bees business. |
| The Clorox Company | | |
Earnings Before Interest and Taxes (EBIT) and Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1)
Reconciliation schedule of earnings before income taxes to EBIT and EBITDA
Dollars in millions and percentages based on rounded numbers
| Three Months Ended | Nine Months Ended | |||||||||||
| 3/31/09 | 3/31/08 | 3/31/09 | 3/31/08 | |||||||||
| Earnings before income taxes | $233 | $151 | $550 | $453 | ||||||||
| Interest income | (1 | ) | (3 | ) | (3 | ) | (10 | ) | ||||
| Interest expense | 39 | 46 | 125 | 125 | ||||||||
| EBIT(2) | 271 | 194 | 672 | 568 | ||||||||
| EBIT margin(2) | 20.1 | % | 14.3 | % | 17.0 | % | 15.0 | % | ||||
| Depreciation and amortization | 49 | 56 | 142 | 154 | ||||||||
| EBITDA(3) | $320 | $250 | $814 | $722 | ||||||||
| EBITDA margin(3) | 23.7 | % | 18.5 | % | 20.6 | % | 19.1 | % | ||||
| Net sales | $1,350 | $1,353 | $3,950 | $3,778 | ||||||||
| (1) | In accordance with SEC's Regulation G, this schedule provides the definition of certain non-GAAP measures and the reconciliation to the most closely related GAAP measure. | |
| Management believes the presentation of EBIT, EBIT margin, EBITDA and EBITDA margin provides additional useful information to investors about current trends in the business. | ||
| (2) | EBIT (a non-GAAP measure) represents earnings before income taxes (a GAAP measure), excluding interest income and expense, as reported above. EBIT margin is a measure of EBIT as a percentage of net sales. | |
| (3) | EBITDA (a non-GAAP measure) represents earnings before income taxes (a GAAP measure), excluding interest income, interest expense, depreciation and amortization, as reported above. EBITDA margin is a measure of EBITDA as a percentage of net sales. | |
| The Clorox Company | | |
Supplemental Information – Balance Sheet
(Unaudited)
As of March 31, 2009
Working Capital Update
| Q3 | ||||||
| FY 2009 | FY 2008 | Change | Days(5) | Days(5) | ||
| ($ millions) | ($ millions) | ($ millions) | FY 2009 | FY 2008 | Change | |
| Receivables, net | $457 | $456 | $1 | 29 | 28 | 1 day |
| Inventories, net | $406 | $423 | -$17 | 49 | 47 | 2 days |
| Accounts payable(1) | $333 | $340 | -$7 | 40 | 36 | 4 days |
| Accrued liabilities | $460 | $406 | $54 | |||
| Total WC(2) | $137 | $171 | -$34 | |||
| Total WC % net sales(3) | 2.5% | 3.2% | ||||
| Average WC(2) | $145 | $158 | -$13 | |||
| Average WC % net sales(4) | 2.7% | 2.9% | ||||
- Inventoriesdecreased primarily as a result of a reduction in inventory values due to lower commodity prices.
- Accrued liabilitiesincreased primarily due to an increase in commodity hedging liabilities as a result of the reduction in the market prices of certain commodities.
Supplemental Information – Cash Flow
(Unaudited)
For the quarter ended March 31, 2009
Capital expenditures for the third quarter were $51 million
Depreciation and amortization for the third quarter was $49 million
Cash provided by operations
Net cash provided by operations in the third quarter was $232 million, compared with $165 million in the year-ago quarter. The increase was primarily due to an increase in earnings from operations and improvements in working capital.
| (1) | Days of accounts payable is calculated as follows: average accounts payable / [(cost of products sold + change in inventory) / 90]. | |
| (2) | Working capital (WC) is defined in this context as current assets minus current liabilities excluding cash and short-term debt, based on end of period balances. Average working capital represents a two-point average of working capital. | |
| (3) | Represents working capital at the end of the period divided by annualized net sales(current quarter net sales x 4). | |
| (4) | Represents a two-point average of working capital divided by annualized net sales(current quarter net sales x 4). | |
| (5) | Days calculations based on a two-point average. |
| The Clorox Company | | |
SupplementalInformation –GrossMarginDrivers
The table belowprovides details on the drivers of grossmarginchange versus the prior year.
| Change vs. Prior Year (basis points) | ||||||||
| Driver | FY08 | FY09 | ||||||
| Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | |
| Cost savings | +180 bp | +170 bp | +150 bp | +180 bp | +170 bp | +200 bp | +210 bp | +240 bp |
| Pricing changes | +50 bp | +40 bp | +80 bp | +150 bp | +80 bp | +230 bp | +350 bp | +310 bp |
| Market movement (commodities) | -120 bp | -170 bp | -350 bp | -370 bp | -270 bp | -460 bp | -450 bp | 0 bp |
| Manufacturing & logistics(1) | -140 bp | -70 bp | -120 bp | -170 bp | -110 bp | -250bp | -120 bp | -90 bp |
| All other(2) | 0 bp | -130 bp | -110 bp | 0 bp | -60 bp | +80 bp | -30 bp | +90 bp |
| Gross margin change vs prior year | -30 bp | -160 bp | -350 bp | -210 bp | -190 bp | -200 bp | -40 bp | +550 bp |
| (1) | “Manufacturing & logistics” includes the change in the cost of diesel fuel. | |
| (2) | “All other” includes all other drivers of gross margin change, which are usually insignificant in nature. Examples of drivers included: volume change, trade and consumer spending, restructuring and acquisition-related costs, foreign currency, etc. If a driver included in all other is deemed to be significant in a given period, it will be disclosed as part of the company’s earnings release. |
| The Clorox Company Updated: 5-1-09 | | |
U.S. Pricing Actions from CY2005 - CY2009
| Brand / Product | Average Increase | Effective Date |
| Home Care | ||
| Clorox Clean-Up®cleaners | 5% | July 2005 |
| Clorox Clean-Up®and Tilex®cleaners | 8% | January 2006 |
| Pine-Sol®cleaners | 13% | May 2008 |
| Clorox Clean-Up®cleaners | 8% | August 2008 |
| Formula 409®, Tilex®, and Clorox®Disinfecting Bathroom cleaners | 12% | August 2008 |
| Liquid-Plumr®products | 9% | August 2008 |
| Clorox®Toilet Bowl Cleaner and Clorox®ToiletWandTMproducts | 8 – 13% | August 2008 |
| Laundry | ||
| Clorox 2®bleach for colors | 5% | July 2005 |
| Clorox®liquid bleach | 9% | July 2005 |
| Clorox®liquid bleach | 8% | January 2006 |
| Clorox®liquid bleach | 10% | August 2008 |
| Glad | ||
| Glad®trash bags | 13% | February 2005 |
| GladWare®disposable containers | 12% | February 2005 |
| Glad®food bags | 7% | August 2005 |
| GladWare®disposable containers | 9% | January 2006 |
| Glad®trash bags | 15% | February 2006 |
| Glad®trash bags (rescinded May 2009) | 7% | February 2008 |
| GladWare®disposable containers (rescinded April 2009) | 7% | February 2008 |
| Glad®trash bags (rescinded December 2008) | 10% | October 2008 |
| Litter | ||
| Cat litter | 5% | October 2005 |
| Cat litter | 6% | June 2006 |
| Cat litter | 7 – 8% | August 2008 |
| Food | ||
| Hidden Valley Ranch®salad dressing | 6% | October 2007 |
| Hidden Valley Ranch®salad dressing | 7% | August 2008 |
| Charcoal | ||
| Match Light®charcoal | 6% | January 2006 |
| Kingsford®lighter fluid | 10% | January 2006 |
| Charcoal and lighter fluid | 4 – 8% | January 2007 |
| Charcoal | 6% | January 2008 |
| Charcoal and lighter fluid | 7 – 16% | January 2009 |
| The Clorox Company Updated: 5-1-09 | | |
U.S. Pricing Actions from CY2005 - CY2009 (continued)
| Brand / Product | Average Increase | Effective Date |
| Brita | ||
| Brita®pour-through filters | 7% | January 2006 |
| Brita®pitchers | 5% | January 2006 |
| Auto | ||
| Armor All®and STP®auto-care products | 9% | January 2006 |
| STP®functional fuel products | 17% | October 2006 |
| Armor All®and STP®auto-care products | 5 – 7% | January 2008 |
| Armor All®and STP®auto-care products | 5 – 10% | January 2009 |
Notes:
- Average % increase reflects brand averages rounded to the whole percent. Individual SKUs vary versus the average.
- This communication reflects pricing actions on primary items.