1 of 1
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

--------------------------

FORM 10-Q

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 29, 2002

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 1-10585

CHURCH & DWIGHT CO., INC.
(Exact name of registrant as specified in its charter)

DELAWARE 13-4996950
(State of incorporation) (I.R.S. Employer Identification No.)

469 NORTH HARRISON STREET, PRINCETON, N.J. 08543-5297
(Address of principal executive office) (Zip Code)

Registrant's telephone number, including area code: (609) 683-5900

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 X No
---------- ----------

As of May 3, 2002, there were 39,442,615 shares of Common Stock outstanding.

- --------------------------------------------------------------------------------

PART I - FINANCIAL INFORMATION

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(UNAUDITED)

THREE MONTHS ENDED
(Dollars in thousands, except per share data) MAR. 29, 2002 MAR. 30, 2001
------------- -------------

NET SALES........................................................................... $ 256,802 $ 226,780
Cost of sales....................................................................... 183,552 162,429
---------- ----------
GROSS PROFIT........................................................................ 73,250 64,351
Marketing expense................................................................... 16,832 16,386
Selling, general and administrative expenses........................................ 29,191 27,013
---------- ----------
INCOME FROM OPERATIONS.............................................................. 27,227 20,952
Equity in earnings of affiliates.................................................... 917 1,032
Investment earnings................................................................. 565 405
Other income (expense).............................................................. (193) (1,003)
Interest expense.................................................................... (6,088) (670)
----------- ----------
INCOME BEFORE MINORITY INTEREST AND TAXES .......................................... 22,428 20,716
Minority interest................................................................... 89 1,984
---------- ----------
Income before taxes................................................................. 22,339 18,732
Income taxes........................................................................ 7,416 6,585
---------- ----------
NET INCOME.......................................................................... 14,923 12,147
Retained earnings at beginning of period............................................ 312,409 276,700
---------- ----------
327,332 288,847
Dividends paid...................................................................... 2,942 2,699
---------- ----------
Retained earnings at end of period.................................................. $ 324,390 $ 286,148
========== ==========
Weighted average shares outstanding - Basic......................................... 39,267 38,538
Weighted average shares outstanding - Diluted....................................... 41,488 40,333
========== ==========
EARNINGS PER SHARE:
Net income per share - Basic........................................................ $ .38 $ .32
Net income per share - Diluted...................................................... $ .36 $ .30
========== =========
DIVIDENDS PER SHARE................................................................. $ .075 $ .07
========== =========

See Notes to Consolidated Financial Statements.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

MAR. 29, 2002 DEC. 31, 2001
(Dollars in thousands) (UNAUDITED)
ASSETS

CURRENT ASSETS
Cash and cash equivalents........................................................... $ 53,852 $ 52,446
Accounts receivable, less allowances of $2,809 and $3,666........................... 101,551 106,291
Inventories......................................................................... 101,970 101,214
Deferred income taxes............................................................... 24,580 19,849
Note receivable and current portion of long-term note receivable.................... 5,870 5,803
Prepaid expenses.................................................................... 7,069 7,604
---------- ----------
TOTAL CURRENT ASSETS................................................................ 294,892 293,207
---------- ----------
PROPERTY, PLANT AND EQUIPMENT (NET)................................................. 239,375 231,449
NOTES RECEIVABLE.................................................................... 11,082 11,951
EQUITY INVESTMENT IN AFFILIATES..................................................... 115,336 115,121
LONG-TERM SUPPLY CONTRACTS.......................................................... 7,406 7,695
TRADENAMES.......................................................................... 136,808 136,934
GOODWILL ........................................................................... 135,886 127,320
OTHER ASSETS........................................................................ 27,691 25,408
---------- ----------
TOTAL ASSETS........................................................................ $ 968,476 $ 949,085
========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Short-term borrowings............................................................... $ 3,875 $ 3,220
Accounts payable and accrued expenses............................................... 169,810 176,176
Current portion of long-term debt................................................... 8,360 8,360
Income taxes payable................................................................ 4,834 8,260
---------- ----------
TOTAL CURRENT LIABILITIES........................................................... 186,879 196,016
---------- ----------
LONG-TERM DEBT...................................................................... 406,995 406,564
DEFERRED INCOME TAXES............................................................... 37,109 27,032
DEFERRED AND OTHER LONG-TERM LIABILITIES............................................ 20,205 19,164
NONPENSION POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS............................... 15,380 15,880
MINORITY INTEREST................................................................... 2,199 2,126
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred Stock-$1.00 par value
Authorized 2,500,000 shares, none issued....................................... -- --
Common Stock-$1.00 par value
Authorized 100,000,000 shares, issued 46,660,988 shares........................ 46,661 46,661
Additional paid-in capital.......................................................... 30,877 28,414
Retained earnings................................................................... 324,390 312,409
Accumulated other comprehensive (loss).............................................. (8,913) (9,728)
----------- ----------
393,015 377,756
Common stock in treasury, at cost:
7,272,456 shares in 2002 and 7,518,105 shares in 2001.......................... (93,306) (95,453)
----------- ----------
TOTAL STOCKHOLDERS' EQUITY.......................................................... 299,709 282,303
========== ==========
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.......................................... $ 968,476 $ 949,085
========== ==========

See Notes to Consolidated Financial Statements.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOW

THREE MONTHS ENDED
(Dollars in thousands) MAR. 29, 2002 MAR. 30, 2001
------------- -------------

CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME.......................................................................... $ 14,923 $ 12,147
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization....................................... 6,482 6,241
Equity in earnings of affiliates............................................... (917) (1,032)
Deferred income taxes.......................................................... 6,701 601
Other.......................................................................... (152) (225)
Change in assets and liabilities:
Decrease/(increase) in accounts receivable..................................... 5,573 (20,767)
(Increase) in inventories...................................................... (1,571) (3,539)
Decrease/(increase) in prepaid expenses........................................ 548 (810)
(Decrease)/increase in accounts payable........................................ (10,037) 11,049
(Decrease)/increase in income taxes payable.................................... (2,043) 4,161
(Decrease)/increase in other liabilities....................................... (11) 733
---------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES........................................... 19,496 8,559
CASH FLOW FROM INVESTING ACTIVITIES
Decrease in short-term investments.................................................. -- 997
Additions to property, plant and equipment.......................................... (10,104) (7,749)
Acquisition of Biovance stock (net of cash acquired of $365)........................ (7,714) --
Proceeds from note receivable....................................................... 803 --
Distributions from affiliates....................................................... 703 667
Other long-term assets.............................................................. (465) (237)
Proceeds from sale of fixed assets.................................................. 75 509
Purchase of USAD stock.............................................................. -- (4,948)
Purchase of supply contract......................................................... -- (786)
--------- ---------
NET CASH USED IN INVESTING ACTIVITIES............................................... (16,702) (11,547)
CASH FLOW FROM FINANCING ACTIVITIES
Long-term debt (repayment).......................................................... (1,830) (273)
Short-term debt borrowing/(repayment)............................................... 123 (402)
Proceeds from stock options exercised............................................... 3,261 3,563
Payment of cash dividends........................................................... (2,942) (2,699)
---------- ---------
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES................................. (1,388) 189
NET CHANGE IN CASH AND CASH EQUIVALENTS............................................. 1,406 (2,799)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR...................................... 52,446 21,573
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD.......................................... $ 53,852 $ 18,774
========= =========

ACQUISITION IN WHICH LIABILITIES WERE ASSUMED ARE AS FOLLOWS:
Fair value of assets................................................................ $ 14,656
Cash paid for stock................................................................. (7,714)
---------
Liabilities assumed................................................................. $ (6,942)

See Notes to Consolidated Financial Statements.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. The consolidated balance sheet as of March 20, 2002, the consolidated
statements of income and retained earnings for the three months ended March 29,
2002 and March 30, 2001 and the consolidated statements of cash flow for the
three months then ended have been prepared by the Company without audit. In the
opinion of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flow at March 29, 2002 and for all periods presented have
been made.

Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these condensed
consolidated financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's December 31, 2001 annual
report to shareholders. The results of operations for the period ended March 29,
2002 are not necessarily indicative of the operating results for the full year.

2. Inventories consist of the following:

(In thousands) MAR. 29, 2002 DEC. 31, 2001
------------- -------------

Raw materials and supplies................................ $ 31,635 $ 28,869

Work in process........................................... 244 651

Finished goods ........................................... 70,091 71,694
---------- --------------

$ 101,970 $ 101,214
========== ==========

3. Property, Plant and Equipment consist of the following:

(In thousands) MAR. 29, 2002 DEC. 31, 2001
------------- -------------

Land...................................................................... $ 6,498 $ 6,503

Buildings and improvements................................................ 92,361 92,577

Machinery and equipment................................................... 258,441 253,749

Office equipment and other assets......................................... 25,100 25,037

Software ................................................................. 5,628 5,652

Mineral rights ........................................................... 255 257

Construction in progress.................................................. 26,293 17,593
---------- ----------
414,576 401,368

Less accumulated depreciation, depletion and amortization................. 175,201 169,919
---------- ----------
Net Property, Plant and Equipment......................................... $ 239,375 $ 231,449
========== ==========

4. Earnings Per Share

Basic EPS is calculated based on income available to common shareholders and the
weighted-average number of shares outstanding during the reported period.
Diluted EPS includes additional dilution from potential common stock issuable
pursuant to the exercise of stock options outstanding

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

5. Impairment and Other Items

During 2000, the Company recorded a pre-tax charge of $21.9 million relating to
three major elements: a $14.3 million write-down of the Company's Syracuse N.Y.
manufacturing facility, a $2.1 million charge for potential carrying and site
clearance costs, and a $5.5 million severance charge (including $2.2 million
pension plan amendment) related to both the Syracuse shutdown and the sales
force reorganization. The Company also incurred depreciation and other charges
of $1.8 million in 2000 and $1.4 million in 2001 relating to a plant and
warehouses that were shutdown. This brings the total one-time cost to
approximately $25 million. The cash portion of this one-time cost, however, was
less than $5 million after tax.

Components of the outstanding reserve balance included in accounts payable and
accrued expenses consist of the following:

RESERVES AT PAYMENTS & RESERVES AT
(In thousands) DEC. 31, 2001 ADJUSTMENTS MAR. 29, 2002
------------- ----------- -------------

Severance and other charges..................... $ 762 $ (56) $ 706

Site clearance costs............................ 1,186 (423) 763
-------- -------- --------

$ 1,948 $ (479) $ 1,469
======== ======== ========

6. Segment Information

Segment sales and operating profit for the first quarter of 2002 and 2001 are as
follows:

UNCONSOLIDATED
(In thousands) CONSUMER SPECIALTY AFFILIATES TOTAL
-------- --------- ---------- -----
NET SALES

First quarter 2002.......................... $ 309,284 $ 53,989 $ (106,471) $ 256,802

First quarter 2001.......................... 183,617 55,496 (12,333) 226,780

OPERATING PROFIT

First quarter 2002.......................... 32,680 7,103 (12,556) 27,227

First quarter 2001.......................... 16,011 6,981 (2,040) 20,952

Both Consumer and Specialty net sales and operating profit include 100 percent
of the results of unconsolidated affiliates.

Product line net sales data for the first quarter periods are as follows:

DEODORIZING UNCON-
AND PERSONAL INTERNATIONAL SPECIALTY SOLIDATED
CLEANING LAUNDRY CARE CONSUMER PRODUCTS AFFILIATES TOTAL
-------- ------- ---- -------- -------- ---------- -----

1st Qtr 2002.... $ 62,507 $ 100,210 $ 90,511 $ 56,056 $ 53,989 $(106,471) $ 256,802

1st Qtr 2001.... 50,065 97,936 27,546 8,070 55,496 (12,333) 226,780

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

As a result of the Arrid Antiperspirant acquisition and the formation of Armkel,
the Company has reclassified the consumer product division into four product
lines, which breaks out international from the underlying products and combines
the specialty products division into one product line. Prior year sales have
been restated.

7. Armkel LLC

The following table summarizes financial information for Armkel LLC. The Company
accounts for its 50% interest under the equity method.

QUARTER ENDED
MARCH 29,
(In thousands) 2002
----
Income statement data:

Net sales........................................................................... $ 96,453

Gross profit........................................................................ 45,434

Net income ......................................................................... 308

Equity in affiliate ................................................................ 308

MARCH 29, December 31,
(In thousands) 2002 2001
---- ----
Balance sheet data:

Current assets...................................................................... 207,464 $ 225,104

Noncurrent assets................................................................... 584,353 587,489

Short-term debt..................................................................... 8,416 5,671

Current liabilities (excluding short-term debt)..................................... 116,540 135,057

Long-term debt...................................................................... 437,618 439,750

Other long-term liabilities......................................................... 26,838 28,711

Partners' equity.................................................................... 202,405 203,404

Under the partnership agreement with Kelso, the Company is allocated 50% of all
book and tax profits. If there are losses, the Company is allocated 50% of all
book and tax losses up to $10 million and 100% of such losses above that level
for the period starting September 29, 2001, the date of the acquisition. The
Company is entitled to 100% of the profits up till an amount equal to the
accumulated excess losses it recorded. As a result, the Company recorded 100% of
the first quarter net income of $.3 million.

During the quarter, the Company invoiced Armkel $3.5 million for administrative
services, and purchased $5.4 million of deodorant antiperspirant inventory
produced by Armkel at its cost. Armkel invoiced the Company $1.0 million of
transition administrative services. The Company has an open receivable from
Armkel at March 29, 2002 of approximately $6.0 million that primarily related to
cash collected by Armkel on behalf of the Company for open accounts receivable
and administration fees, partially offset by amounts owed for inventory.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

8. Biovance Acquisition

As previously announced, in January the Company acquired Biovance Technologies,
Inc., a small Oskaloosa, Iowa-based producer of specialty feed ingredients which
complement our existing range of animal nutrition products. The purchase price
paid in the first quarter was $7.7 million (net of cash acquired) and included
the assumption of debt. The Company accrued $3.0 million of additional payments
at March 29, 2002 based upon contractual obligations, which will be paid in
2003. Additional payments will be required based on future operating
performance.

The following table summarizes the estimated fair value of the assets acquired
and liabilities assumed at the date of acquisition:

(In thousands)

Current assets............................................................ $ 1,374
Property, plant and equipment............................................. 3,540
Tradenames................................................................ 46
Goodwill.................................................................. 10,061
-----------
Total assets acquired..................................................... 15,021
Current liabilities....................................................... (4,603)
Long-term liabilities..................................................... (2,339)
-----------
Net assets acquired....................................................... $ 8,079
===========

The results of operations are included in the accompanying financial statements
from January 1, 2002, and were not significant.

An appraisal is currently in process and the purchase prince allocation will be
modified based on its results. Goodwill is not being amortized, based on the
provisions of SFAS 142 "Goodwill and Other Intangible Assets." The Goodwill is
not expected to be deductible for tax purposes and will be included in the
specialty products segment.

9. Recent Accounting Pronouncements

a. During the quarter, the Company adopted EITF 00-14 "Accounting for
Certain Sales Incentives" and EITF 00-25 "Vendor Income Statement
Characterization of Consideration from a Vendor to a Retailer." EITF
00-14 addresses the income statement classification for offers by a
vendor directly to end consumers that are exercisable after a single
exchange transaction in the form of coupons, rebate offers, or free
products or services disbursed on the same date as the underlying
exchange transaction. The issue requires the cost of these items to be
accounted for as a reduction of revenues, not included as a marketing
expense as the Company did previously. EITF 00-25 outlines required
accounting treatment of certain sales incentives, including slotting
or placement fees, cooperative advertising arrangements, buydowns and
other allowances. The Company previously recorded such costs as
marketing expenses. The issue requires the Company to report the paid
consideration expense as a reduction of sales, rather than marketing
expense. The first quarter 2001 net sales have been restated for both
issues. The impact was a reduction of net sales of approximately $32.0
million and $29.7 million in 2002 and 2001, respectively, and did not
have an effect on net income.

b. In July 2001, the FASB issued SFAS No. 142, "Goodwill and Other
Intangible Assets," which supersedes APB Opinion No. 17, "Intangible
Assets". Under its changes, SFAS No. 142 establishes new standards for
goodwill acquired in a business combination and eliminates
amortization of goodwill and instead sets forth methods to
periodically evaluate goodwill for impairment. The Company adopted
this statement upon its effective date.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

The following tables discloses the carrying value of all intangible assets:

MARCH 29, 2002 DECEMBER 31, 2001
-------------- -----------------
GROSS CARRYING ACCUM. GROSS CARRYING ACCUM.
AMOUNT AMORTIZATION NET AMOUNT AMORTIZATION NET
------ ------------ --- ------ ------------ ---
AMORTIZED INTANGIBLE ASSETS:
- ---------------------------

Tradenames............ $ 13,500 $ (1,575) $ 11,925 $ 13,500 $ (1,406) $ 12,094

Technology............ 4,241 (392) 3,849 4,241 (302) 3,939
--------- --------- --------- ---------- -------- ---------

Total................. $ 17,741 $ (1,967) $ 15,774 $ 17,741 $ (1,708) $ 16,033
========= ========= ========= ========== ======== =========

UNAMORTIZED INTANGIBLE ASSETS - Carrying value
- -----------------------------

Tradenames............ $ 124,883 $ 124,840
--------- ----------

Total................. $ 124,883 $ 124,840
========= ==========

Intangible amortization expense amounted to $.3 million in the current quarter
and $1.0 million for the same period of a year ago. The estimated intangible
amortization for each of the next five years is approximately $1.0 million.

The changes in the carrying amount of goodwill for the quarter ended March 29,
2002 is as follows:

(In thousands) CONSUMER SPECIALTY TOTAL
-------- --------- -----

Balance December 31, 2001........................ $ 116,372 $ 10,948 $ 127,320

Purchase accounting adjustments.................. (1,637) -- (1,637)

Goodwill acquired during quarter................. 296 10,061 10,357

FAS 109 adjustment............................... -- (92) (92)

Foreign exchange/other........................... -- (62) (62)
----------- ---------- -----------

Balance March 29, 2002........................... $ 115,031 $ 20,855 $ 135,886
=========== ========== ===========

Net income results and per share amounts for the quarter ended March 30, 2001
reflecting goodwill and intangible assets that are no longer being amortized is
as follows:

MARCH 29, March 30,
2002 2001
---- ----

Reported net income.......................................................... $ 14,923 $ 12,147
Goodwill amortization (net of tax)........................................... -- 392
Discontinued tradename amortization (net of tax)............................. -- 139
---------- ----------

Adjusted net income.......................................................... $ 14,923 $ 12,678
========== ==========

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

Basic earning per share:
As reported............................................ $0.38 $0.32
Goodwill amortization.................................. -- 0.01
Tradename amortization................................. -- --
---------- ----------
Adjusted net income.................................... $0.38 $0.33
========== ==========

Diluted earnings per share:
As reported............................................ $0.36 $0.30
Goodwill amortization.................................. -- 0.01
Tradename amortization................................. -- --
---------- ----------
Adjusted net income.................................... $0.36 $0.31
========== ==========

c. In January 2002, the Company adopted SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets". SFAS No. 144 addresses
financial accounting and reporting for the impairment or disposal of
long-lived assets. This statement supersedes FASB Statement No. 121,
"Accounting for the Impairment of Long-Lived Assets to Be Disposed Of" and
the accounting and reporting provisions of APB Opinion No. 30, Reporting
the Results of Operations Reporting the Effects of Disposal of a Segment of
a Business, and Extraordinary, Unusual and Infrequently Occurring Events
and Transactions", for the disposal of a business (as previously defined in
that Opinion). This statement also amends ARB No. 51, "Consolidated
Financial Statements"' to eliminate the exception to consolidation for a
subsidiary for which control is likely to be temporary. The Company has
evaluated this statement and has determined there is no material impact on
the Company's consolidated financial statements.

10. Comprehensive Income

The following table presents the Company's Comprehensive Income for the three
months ending March 29, 2002 and March 30, 2001:

THREE MONTHS ENDED
------------------
MARCH 29, March 30,
(In thousands) 2002 2001
---- ----

Net Income................................................................. $ 14,923 $ 12,147
Other Comprehensive Income, net of tax:
Foreign exchange translation adjustments............................... (231) (1,589)
Interest rate swap agreements.......................................... 1,046 --
Available for Sale securities.......................................... -- 4,623
---------- ---------
Comprehensive Income....................................................... $ 15,738 $ 15,181
========== =========

11. Contingencies

Certain former shareholders of Carter-Wallace have brought legal action against
the company that purchased the pharmaceutical business of Carter-Wallace
regarding the fairness of the consideration these shareholders received.
Pursuant to various indemnification agreements, Armkel could be liable for
damages up to $12 million, and the Company could be liable directly to Armkel
for an amount up to $2 million.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

The Company believes that the consideration offered was fair to the former
Carter-Wallace shareholders, and it cannot predict with certainty the outcome of
this litigation.

The Company, in the ordinary course of its business, is the subject of, or a
party to, various pending or threatened legal actions. The Company believes that
any ultimate liability arising from these actions will not have a material
adverse effect on its consolidated financial statements.

12. Reclassification

Certain prior year amounts have been reclassified in order to conform with the
current year presentation.

MANAGEMENT'S DISCUSSION AND ANALYSIS

RESULTS OF OPERATIONS

For the quarter ended March 29, 2002, net income was $14.9 million, equivalent
to basic earnings of $.38 per share, from $12.1 million or $.32 per share, in
last year's first quarter. Diluted earnings were $.36 per share compared to $.30
per share last year. This year's results include a $0.06 per share accounting
charge related to the step-up of opening inventory values by the Company's
recently formed affiliate, Armkel LLC. Last year's results included a $1.4
million or $0.02 per share charge related to a plant shutdown, and a $0.7
million or $0.01 per share charge related to intangibles amortization that was
discontinued in 2002 with the adoption of accounting standard FAS 142. Adjusting
for these unusual items, earnings per share increased by $0.09 per share or 27%
to $0.42 per share from $0.33 in the comparable period last year.

Sales increased 13.2% to $256.8 million from $226.8 million in the previous
year. Consumer products sales increased 15.9% to $212.8 million, primarily due
to the addition of the Arrid antiperspirant and Lambert Kay pet care businesses
as part of the Carter-Wallace acquisition. Excluding the acquired brands,
consumer sales increased 2%, with higher deodorizers and cleaners and laundry
products, partially offset by lower personal care products. Specialty products
increased 1.9% to $44 million, primarily due to the acquisition of a new animal
nutrition product line partially offset by a discontinued specialty chemicals
line.

During the quarter, the Company adopted EITF 00-14 "Accounting for Certain Sales
Incentives" and EITF 00-25 "Vendor Income Statement Characterization of
Consideration from a Vendor to a Retailer." EITF 00-14 addresses the income
statement classification for offers by a vendor directly to end consumers that
are exercisable after a single exchange transaction in the form of coupons,
rebate offers, or free products or services disbursed on the same date as the
underlying exchange transaction. The issue requires the cost of these items to
be accounted for as a reduction of revenues, not included as a marketing expense
as the Company did previously. EITF 00-25 outlines required accounting treatment
of certain sales incentives, including slotting or placement fees, cooperative
advertising arrangements, buydowns and other allowances. The Company recorded
such costs as marketing expenses. The issue requires the Company to report the
paid consideration expense as a reduction of sales, rather than marketing
expense. The first quarter 2001 net sales have been restated for both issues.
The impact was a reduction of net sales of approximately $32.0 million and $29.7
million in 2002 and 2001, respectively, and did not have an effect on net
income.

Gross profit margin was 28.5% in the quarter, virtually unchanged from a year
ago. Lower manufacturing costs on Laundry products were offset by lower ARM &
HAMMER personal care sales and higher expenses associated with the manufacturing
of Arrid Antiperspirant.

Marketing expenses increased $.5 million verses 2001. Lower spending on existing
personal care products were more than offset by spending associated with the
acquired products and an increase in deodorizing and cleaning products.

Selling, general and administrative expenses increased from $27.0 million to
$29.2 million. Higher personnel related expenses and transition expenses
associated with the Carter-Wallace acquired products were partially offset by
the elimination of Goodwill and certain tradename amortization expense
associated with the Company's adoption of FAS 142.

Earnings from affiliates were slightly lower as a result of lower ArmaKleen
earnings, partially offset by the inclusion of Armkel.

Interest expense increased significantly from last year as a result of the
Company carrying the debt that was used to make the two major acquisitions in
2001. Other expenses decreased as a result that during the first quarter of
2001, the Company recorded changes in fair value of derivative instruments not
designated as hedging instruments in earnings in the period. Subsequently, these
contracts were designated as hedging instruments of debt incurred as part of the
Carter-Wallace acquisition, and changes in value were made through other
comprehensive income in the equity portion of the Company's Balance Sheet. In
addition, foreign exchange losses in 2001 associated with the Brazilian
subsidiary also contributed.

The effective tax rate for the quarter was 33.2%, down from 35.2% in last year's
first quarter which reflects the impact of Armkel's foreign subsidiaries, whose
post-tax results are included in equity in earning of affiliates.

MANAGEMENT'S DISCUSSION AND ANALYSIS - (CONTINUED)

LIQUIDITY AND CAPITAL RESOURCES

The Company considers cash and short-term investments as the principal
measurement of its liquidity. At March 29, 2002, cash including cash equivalents
totaled $53.9 million as compared to $52.4 million at December 31, 2001.

The Company had outstanding long-term debt of $407 million, and the
aforementioned cash equivalents less short-term debt of $42 million, for a net
debt position of $365 million at quarter-end. In addition, the Company had
unused revolving credit facility of $100 million. Based on the definition in its
loan agreements, the Company's cash flow (EBITDA) is estimated at $34 million
for the quarter.

Financial covenants include a leverage ratio and an interest coverage ratio,
which were both met for the quarter. The Company believes cash on hand along
with the $100 million revolving credit facility is sufficient to meet its
liquidity needs.

During the first quarter of 2002, the Company generated $19.5 million of cash
flow from operating activities and received $3.3 million from stock option
exercises. Significant expenditures include the purchase of Biovance stock of
$7.7 million, property, plant and equipment additions of $10.1 million and the
payment of cash dividends of $2.9 million.

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements relating, among others, to
financial objectives, sales growth and cost improvement programs. These
statements, including the statements above as to the impact of the UDAD and
Carter-Wallace acquisition on sales and earnings, represent the intentions,
plans, expectations and beliefs of Church & Dwight, and are subject to risks,
uncertainties and other factors, many of which are outside the Company's
control. These factors, which include the ability of Church & Dwight to
successfully integrate the operations of the consumer products business of
Carter-Wallace into the Armkel joint venture and Church & Dwight, and
assumptions as to market growth and consumer demand (including the effect of
recent political and economic events on consumer purchases), and the outcome of
contingencies, including litigation, environmental remediation and the
divestiture of assets, could cause actual results to differ materially from such
forward-looking statements. With regard to new product introductions, there is
particular uncertainty related to trade, competitive and consumer reactions. For
a description of additional cautionary statements, see Church & Dwight's
quarterly and annual reports filed with the SEC, as well as Carter-Wallace's
historical SEC reports.

PART II - OTHER INFORMATION

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

a. Exhibits (11) Computation of earnings per share

b. No reports on Form 8-K were filed for the three months ended
March 29, 2002.

CHURCH & DWIGHT CO., INC. AND SUBSIDIARIES
EXHIBIT 11 - COMPUTATION OF EARNINGS PER SHARE
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

THREE MONTHS ENDED
------------------
MARCH 29, March 30,
2002 2001
---- ----
BASIC:

Net Income.................................................... $ 14,923 $ 12,147

Weighted average shares outstanding................................. 39,267 38,538

Basic earnings per share............................................ $.38 $.32

DILUTED:
Net Income.................................................... $ 14,923 $ 12,147

Weighted average shares outstanding................................. 39,267 38,538
Incremental shares under stock option plans................... 2,221 1,795
---------- ----------
Adjusted weighted average shares outstanding........................ 41,488 40,333
---------- ----------

Diluted earnings per share.......................................... $.36 $.30

SIGNATURES

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.

CHURCH & DWIGHT CO.,INC.
--------------------------------------------
(REGISTRANT)

DATE: 5/10/2002 /S/ ZVI EIREF
----------------------- --------------------------------------------
ZVI EIREF
VICE PRESIDENT FINANCE

DATE: 5/10/2002 /S/ GARY P. HALKER
----------------------- --------------------------------------------
GARY P. HALKER
VICE PRESIDENT, CONTROLLER AND
CHIEF INFORMATION OFFICER