CLX - Earnings call transcript Q4 2020

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Operator

Good day, ladies and gentlemen, and welcome to The Clorox Company Fourth Quarter and Fiscal Year 2020 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Ms. of for President Clorox Vice Burhan, Investor The Relations Company. Lisah Ms. may begin you your Burhan, conference.

Lisah Burhan

everyone you safe and today. Welcome Hillary. Thanks, thank you your We for and family well. are and hope us joining

CEO; CEO-Elect. with call Linda Benno Chair CFO; today On Kevin President the our and me Jacobsen, our Dorer, are our and Rendle, and

few to over to Benno? Benno Before we and QX announced it our the full year changes say turn a words go through results, about leadership I'd like to today.

Benno Dorer

everyone. hello and Lisa, you, Thank

wonderful and of shareholders likely I successfully announcement as belief, great serving guided Directors behalf my step who over that, Linda been all the I on the and the for to leader, and towards strong, you. to to a is worked and the end ventured companies that current Thank out XX Black go created places Q&A planet have a With your forward Linda carry Rendle, dream allowed and You've track do guy of for morning's in a pleased candor, matters. led she Clorox XX to able you forward with the of of also more out this I a things Growth stakeholders. continue I call. pursue me look appreciate everyone Good joining what outstanding how let down that's cannot particularly our at to as is in of me ago particularly confidence years my Chair perspective of as the the from effective the a turn our always our do. support profitable, course, I've of idea and to and community Linda could to the record, all I to supporting this in way, been right and my for as way. and the have which shareholders, German world forest, thank of today in decision pursuit whole and exceptional X,XXX will an her town I Executive for I'll have to am a that My able make have imagined. I few After making honor it also with on see around and values, successor, to of of the for I us with your based seen a about important an not to serving team. great them. Lisah. of committed strong and President, also XX. the I privilege my for of company, grateful look Linda my to is with years participate Growth can I we the It's of that CEO. thanks employees, being right of years been She the and which say terrific words great friendships is will small the right my her forward as And to for as her that company. the of of executive investment company to team. wait all Good great of over especially the communities I responsible. to privilege. Board leader and their am be XX strategy serve been our can teams strong has September XX want I've The possibly support, deliver Growth. could proud momentarily. reins September the be that's to helpful in not that Board. both and sustainable generate profit role results in you, named current and appreciate the hand XX, was company, On generations choices to It we us I legacy leaders very an along back

Lisah Burhan

days Thanks, our look reminders well. enjoyed on call management's We're Glad be broadcasting And the contains we I Clorox this more or forward go impact you before with for discussion will with Internet into XX may or over really to than statements as at Benno. current forward-looking Today's from I've thecloroxcompany.com. expected statements working and available statements, These years I based including since to but A working business few the ago. started potential closely results results. call the on expectation, at outcomes. actual of a the differ website, are of COVID-XX. seven replay related Linda

directly both measures earnings end reconcile the to of which identify SEC. also has we our section, release, financial that the are affect forward-looking refer addition, which website and certain tables In located measures, today's could to financial that factors section, most forward-looking measures. comparable of posted been and statements the non-GAAP the non-GAAP non-GAAP may GAAP various with the information Please such the statements refer including which filed financial on at to

line fiscal then each of results. in for discussion highlights the year our covering I'll financial segments. as usual, outlook our our by well address as top of as results with Kevin our today's XXXX. commentary to start Turning will

perspective with and Benno will his offer Q&A. we'll Finally close

year up by results company, the XX%, now our segments. I'll were all sales through in go For growth segment. QX total reflecting increased X%. Full double-digit reportable four sales

total we and company may In FY As segment 'XX. -- is with segments Wellness Laundry unit Wellness segment, largest growth company Home were demand elevated the our in and sales and for newly full had our up Health Care made another business formed of segment, XX%. units. in portfolio. grew release, business which Health sales several and double-digit and realignment QX our the in have Cleaning quarter some sales reportable across XX% The continued a quarter have and our health our the of press about year changes sales replacing Cleaning behind seen XX% merges of you business to representing the

While leading continued able significant share channels. in increase to demand and market prioritization add been This supply, out points stocks facilities our our distribution Healthcare to exceeds to impacting assortment many especially for products. tracked is of on simplification we've far capacity, still and with our focus coupled output of

expect our We a behind grew time half of as over On basis by sales strong back expand performance. Cleaning double-digits production. assortment also improve we year a full share to very

majority excited has been we've seen brand building increased and that leading categories growth March continue new and drive our to the users, by penetration in our show unprecedented since to continues household of Clorox data maintain the momentum to We're to in sales brand. innovation. investments for from Our an increasing

our time. time Strategy priority than continue aggressively expanding These consumer continue Health capacity our our when which core for investments megatrend Wellness remains more brands at urgent support will and most meet our to the to to strengthen relevant demand, our are a IGNITE However, anticipate ever. and production we elevated to some remain leverage

'XX, up an sales exceptional also half. also Our Full fueled back QX, shipments in all strong our total by in X% by sales about of across Professional business, of grew double-digits, supported in making year FY performance -- growth has by for disinfecting the products double-digit sales company platforms.

reminder, professional of from disinfecting the to cleaning As care janitorial comes both products revenue providing a source and health main for and solutions commercial the our channels.

as uses reach recent we're system, we're will cleaners an which have germicidal believe continue today, such hydrogen Clorox We're opportunities. of that include and public business Technologies, as this Total Our and health beyond the support United electrostatic with hard-to-reach disinfecting AMC platform that about to products broad deliver Uber significant Cleveland broader excited to our Clorox XXX Clorox strategic solutions Clinic. partnerships and large as and range in established the Airlines, Clorox well disinfectants has growth we've We brands Theaters disinfecting can peroxide wipes. help proud the bleach, to our areas technology channels

in RenewLife and VMS this There Nutranext the segment, decreased business combined drivers representing Supplements sales within the X% and were Sales Vitamins, Health by total double-digits for about Lastly, and XX. quarter. the decline. our of main company two in FY Wellness Minerals business our

Neutranext been resolved a has a a supply in experience fulfillment expect COVID-XX related meeting to to fall. currently be demand. from situation fully continue third-party our to We're what disruption us healthy transitioning the brands center in the provider First, to that and new prevented a

challenges. based and Second, ongoing competitive Renewlife category

VMS for due brand as to full on the our we're for continuing to forward, relaunch category. sales declined in track with drivers work business Full retailers QX. on 'XX, FY also partnering to remains year Looking reinvigorate double-digits similar the and

We're growth our across as reflecting were to QX, by sales sales full double-digits Household segment. sales three the up QX products X%. continue up grew and at XX%, strong Glad behind Turning businesses, demands stay for see to were all growth in consumers year has by featuring Bags early strong bag fragrances pleased trash colors innovation. been segment, home. driven in positive. Glad QX a also ForceFlex mainly in Trash to experiential We and our unique new Glad launched share and reception

with sequential For platform retail the more among occasion and in Glad grilling year, users quarter, based. plan this Grilling well fueled investing the this strategy. users building penetration category. FY quarter existing and pleased on differentiated grew strong this by new improvement our growth as increased QX. entering slightly, grew with double-digits and 'XX. the household Kingsford our further throughout to a to with reflecting as due on sales been both by strong was growth focused behind ending share We're broad see strong QX, consumption We're innovation new also our full for Collaboration has partners year, momentum sales by very supported

share, especially it The excited to holiday to growth. profitable was build during pellet peak further discounting performance season. invest lean Kingsford in price delivered QX we're was distribution Our because category and Grilling without and in long-term the innovation to notable, aggressive continues

sales back online by and increased we QX, full partially offset consumption growth half. last Cat pantry business the strong solid started following we turnaround in strongly consumption loading in the quarter. Litter as and channels in lower fruit For consumer the bear saw shipments, by sales saw our efforts to that year, to driven innovation traditional grew

grew healthy were this QX, the seeing sales in out-of-stocks fact XX%. QX, unprecedented double-digits, also of by sales Lifestyle that sales we'll we this consumption filtration grew come just systems year Paws momentum demand start household, our Fresh with many for sales of our shipments first impacted reflecting offset XX% a in of in We're share half. started challenging, well, our by see other with back partially that back of the new after strong a the power FY continued grew original resulting categories. in double-digits quarter. in very filters. sales gain up launched front keep Breeze, which the platform by its strong full year, heightened third elevated half the continued the initial water of Brita in encouraged what -- perform half and year In performance, Paws. behind from QX our recent in strong by Litter growth as in continue Step what litter by year have and consumption in also we segment, innovation just full scented Full June. of the and sales launch grew This 'XX. investing and behind encouraged We're been Fresh in the level like Step For Clean half Clean in to majority its pipeline performance we've lap more and

grew eating decline as extended in continue brand and drive as solid value will increased our We'll with growth invest the in In overall Burt's Our at-home in this QX, quarter and brand Regardless this our business impacted had priorities in penetration. the awareness Ranch during quarter period for and innovation strong solid an trial sales recession. XXnd on these in supply. full the increase a consecutive share behind for in lip by mainly double-digits lip The and for this especially consecutive QX, over status proposition to quarter, half. a elevated business the momentum behind time, Full the share as dressing and growth and increased the focus more from US. year loyal the consumption back users ongoing sales growth overall and consumption leadership strong Lip be market new recession. reflecting capitalize Burt's to sales this Bees continue consumers brand behind store consumption bottle benefiting going Hidden enhanced saw household Valley message balm occasions. widened its leadership forward down negatively during consumers closures behind to Brita's the very Convert around support number XXnd half Care, The first by grew of double-digit growth the to and Food eating balm. was innovation are sales year, stay-at-home of one were Bees the category of measures. at to home

challenges short-term, preferences Burt's and unchanged. confident we expect consumer wide specifically for persist While we're more the in category Bees growth trajectory. long-term natural brand's products And the in the to remain

FY robust Our lines in and 'XX that innovation July includes in the CBD squeezy fall. including color care personal a plan products a up, line launched lip new launching

currency Sales products. for foreign was implemented also onset sales cleaning offset benefits that mainly Lastly, of of and to our as partially XX%, disinfecting by grew International. QX impacted by before turning the as elevated pandemic. the the continued unfavorable headwinds by of household demand products well about XX%, were essential pricing driven

up of XX full year, reflecting the For sales foreign exchange unfavorable X%, currency rates. were about points

Additionally, majority Gulf International disinfecting opportunities household worth of joint noting in new business businesses, has it's We're in this cleaning quarter where venture In increases we'll our due and during range stake we Saudi those on Like loyal this penetration products. this associated also that of today period, Kingdom a offered the long-standing with to a product in [ph]. international be focused there the and acquisition profit improved consumers. other XX-year explore long was has history, call of down its continuing to the costs been into households converting announced consumers region, Arabia. the in for

During our steady our they will shown Consistent not growth, strong segment. IGNITE goal, with this in that international drive growth have time, only but acquisition also long-term Strategy help profitability. profitable

it year as our turn our who 'XX over performance and for for well full financial I'll discuss as FY 'XX. will outlook Kevin, Now, to FY QX

Kevin Jacobsen

and for us for very results fiscal your We a well. today. you, 'XX. joining proud you hope Thank are and QX Lisah. And of overall in performance you thank I'm everyone year families strong our

As we supply to fourth and our efforts by Healthcare the consumers been communities. our products have disinfectants a pandemic, and to other continue on unwavering needed to COVID-XX navigate quarter, global maximize has essential significant team impact our workers, in the our continued In results.

margin which we delivered all seventh contributed of fiscal of In four of flow, reportable our of sales expansion quarter addition cash consecutive double-digit in to to quarter growth strong our performance. segments, year strong gross and another all 'XX

the as a shortly. the you said, and we variability more be challenge with our That a the expect, As our increased you outlook saw in outlook of level anticipate press transparency as what the believe will higher release, than possible. of of we on it's duration despite influenced might play today, normally comment anticipating how by important and period provide the heavily crisis. the in this ongoing I'll perspective results as health uncertainty, depth full will heightened providing financial we to investors that of are year because, out, much

gross fourth ago basis favorable expediting production were up quarter XXX offset and points benefits savings, driven and Fourth which mix, increasing quarter. of as were mix. XX%, X to points the included points spending results. well higher increased the as temporary margin for partially cost of Fourth headwinds. offset the favorable volume compared Gross gross logistics basis quarter capacity included points transportation and partially higher our XX.X% retail commodities, points margin philosophy. a X our in at by quarter incentive XXX favorability quarter. pay-for-performance impact related and by Fourth basis in promotion the of XX%, in rate from sales factors year our for ongoing X.X sales to more year-over-year percentage came cost increased from year offset manufacturing FX consistent of of products. to Selling levels also XX.X% point the compared consecutive growth XX Advertising of from than foreign of coming compensation, investment second quarter margin than spending quarter. higher to by to currency business for volume sales ago our of quarter, Turning XX.X% reflected XXX This points about price These the ago in headwinds. the for a reflects about sales as about cost and XX% by expenses our XX.X% and US in at with We're at sales year higher percentage primarily came quarter. as administrative

year our with growth. back of profitable $XX same to we aggressive the perspective, in the fiscal accelerate consistent investments invested compared For period 'XX, long-term ambition half fiscal additional million in year to 'XX, reflecting more

plus COVID-XX, XX%. us of year by teams to 'XX. to basis very XX%. cost respond grew of an diluted fiscal 'XX, XX% out was these year all $X.XX due of per results, in an Our our net the fourth to growth year I'm volume margin EPS XX% lapping the year for results basis the increase the to in overall resulting savings. fiscal X% about delivered on effective strong versus another business We we of fiscal rate we close XX%. Gross impact expansion about and on supported tax quarter, of strong increase $X.XX Net growth quarter, $X.XX, quarter unprecedented year diluted earnings organic factors of year tax the prior period. points ago in benefits in versus to of dedication our compared delivered share ago in factors, the our year progress briefly to of sales XXX Commenting core made pleased robust with delivering ago enabled These of demand sales and our fiscal year

of release, by in was year 'XX As $XXX operations cash fiscal increase billion in $X.X versus saw million provided 'XX, you an year XX%. fiscal net our press

the cash sheet, us long-term continue and strong to flexibility flow growth give balance Our opportunities. investing behind accelerating

fiscal Now more on I'll assumptions 'XX. key with perspective our outlook. Starting provide year our for

to us ongoing plan year production bulk fiscal disposable momentum including First, for to increase value. our ongoing global reduce products. of increasing Disinfecting importance that spending 'XX the our through demand to fiscal be we behind expect our the we resulting providing consumer and for year, the products, particularly elevated address will COVID-XX our many elevated the in expect superior impact of And of our Cleaning global invest for of demand and expectation world seeing US of consumers' face parts Next, half and with first the in we the to we're capacity aggressively an the portfolio, recession ongoing for

Our disruption outlook finally, the minimal the is supply XX% we peso course devaluation currency are potential through the extended also over the a materially parallel chain if than to assuming fiscal year. assumes devaluation Argentine about country's of rate. moves the of And less the which

fiscal our outlook. For sales year

for We demand flat our expect of year to expectation fiscal first the fiscal from COVID-XX. half sales lap initial in to the low-single-digits, up continued a half for demand deceleration in the reflecting we the elevated year back and spike be as

our anticipate majority we joint Arabia saw release, contribute will our venture, in fiscal which you stake acquired year point Saudi sales. have 'XX As in press to of growth we a about X our

our single-digit to primarily an this growth. exchange flat X point expect We organic outlook assumes to by in Argentina. be of low foreign sales On about basis, offset headwinds

delivered decline expect in the impact levels, For year while in decelerating half of pre-pandemic from XX. sales back In performance to increases relative in year sales back we fiscal double-digit COVID-XX half our of the fiscal lapped ago in including additional fiscal we XX% expect sales to year anticipate initial our as year from sales the perspective period. the we QX, on growth we half although of the the we XX, front the strong expectations, fiscal year, growth strong

in long-term and we year fiscal expenses at as come sales about growth administrative XX% initiatives. in to expect invest continue We to selling of aggressively

the to Additionally, advertising demand with and our we this XX% more in for new consumer from as value, categories addition about build increase loyalty which recession. in our increasing existing with to of ever to consumers is critical unprecedented are superior global entering consumers than products to spending continuing first investments new the brands sales, to deliver our plans address to many for navigate we time,

manufacturers important to a growth cost mentioned, our term, demand increase I at production to our use this we while continue in continue to As action internal online. longer opportunities. comes is our while for support for will address we expand elevated capacity, expectation will capacity an production expanding we term new our efforts expansion and our of products In near ongoing believe to higher the our to third-party take come invest

of down 'XX expect our to long-term to tax these the XX%, closer rate be fiscal diluted fiscal be tax rate we to We in year Net up to XX% to of range EPS year our expect factors, assumption. mid-single-digits. mid-single-digits

$X.XX contribution our with fair stake gain $X.XX venture. year recognized stake includes one-time basis high expectations by by Saudi diluted is joint to primarily market in held driven venture, the gain tax fiscal This Arabia full our Our a and a the our previously estimated EPS of foreign projected outlook increased headwinds a associated offset and an a on for in non-cash one-time our to rate to from currency adjustment for company. be in QX year value joint

of and strong global performance proud to over Clorox Before year 'XX how delivering to fight Benno, fiscal team the like help I for the turn in I'd it pandemic. we're playing I to reiterate am this role

be And also shareholder with drive that, years. the to forward Benno it to who say I'm enjoyed with chapter looking aggressively at ongoing turn to as with next a working in Consumer I on how robust difference our over finally, time Clorox' public value. sales the Disinfecting will support And by also products a long-term for health foundation fiscal has company. spend in Our to for make interest products and Strategy Benno. in I've home. that to year they much to day-to-day plan our been want momentum. of I'll certainly And Linda, investing continue more IGNITE the strong to strong a higher. categories results, other continue We never over people essential CEO build lives provide a

Benno Dorer

Kevin. Thanks,

messages three my are Here our QX 'XX and key fiscal for year results.

of be I commitment continue to contributing and leadership supporting consumers people's to very The global 'XX. to communities outstanding this in reflecting on has I'm pleased our we performance our public results, segments delivered up during and strong and organic organic growth year our dedication reportable First, X% health and sales growth sales health led of all fiscal crisis. in QX record. fiscal year sales XX% proud XXXX to highest growth [ph], serving were

also diluted totally year, advertising reflecting delivered We segments gross for per even And of we EBIT able expansion points. XXX for company fiscal fiscal a by we margin with delivered were investments, in and expand gross And fiscal cost our margin 'XX. volume year significant increases share to in results the the robust XX% increase all strength year by basis margin earnings four savings. supported

[indiscernible] face take role better financials full very position retail for strong, of service our the the in customers our We're demand demand. quarter demand the continued seriously are Frankly, for exceeded We this play all many there's up customers While now, of exceeded important our expectations elevated levels keeping were products, happy not QX in pandemic. own in would we but this be persistent with for our on very by for our us, certainly our at with counting our products products. expectations. as thought a year we pandemic and ongoing we and all one area focus on in

hands products sources than accessing a our with not can but other manufacturing of of and be QX, plan urgency this. our products supply deck. high on that of quickly. suppliers too. ahead third-party to this parts focusing portfolio all We're have we on new on to more for supplied on able on maximize And are just disinfecting We us those were sense Since we output, XX for more help our bring

do plants customers we'll the ability pulling our in disinfecting expand all the confident our our continuing to more With am output, for and we're to levers and we're bringing mid-term. consumers. capacity online to For products, be disinfecting XX/X I better run in

on Before commitment people again, message, contributions QX I've Clorox year their I'd to like I go to to results. next my how the say fiscal our valued much of and and

to continues strong X,XXX efforts up business of communities. contribute consumers, customers and of team message The to of is second our Our day our fundamentals to supporting are My every our this. step strong.

the results fiscal historical 'XX. momentum fundamentals the core 'XX which incremental continued to progress about our sales business, and the the year from feel Given and us year of progress contributed good innovation our our I overall average. our company's on core. gives fiscal business fiscal on year 'XX, for In exceeded

As we from see 'XX and exciting introduced year number in products of fiscal Lisah, innovation you've heard to from a growth continue big platforms.

market of same supported -- e-commerce X% year growing in in 'XX, compared in we Our the sales the fast that as our in than year XX% XX% 'XX, channel fast our XXXX, to I'm high, total continued shares And 'XX portfolio had relentless recession. fiscal through products delivering date. year to spending channels to year about pleased value into $XX the to the share ahead percentage QX, US in period fiscal also growing leading focus or investments stable also risen results at of plan. 'XX. on like made of In in of back the positioning in delivering superior grew. million of we lean strongest an innovation half we've market demonstrate achieved penetration, year year, represents well US fiscal well the this tracked I'm about channel by all-time advertising. to After brands choice the in in our right superior seen differentiate sales, e-commerce these e-commerce to grow market our company company Results well continues our and more that now as household digital total fiscal And proud in consumer advertising including value fiscal increase compared more our our the brands. has fiscal to and portfolio by consumers

to We Importantly our driving progress and continue last leads long-term ability long-term us up and And committed 'XX, our these portfolio to to categories Clearly position, confident against shareholder strengthen building our fiscal extraordinary through are investments by this grow on message. Strategy. momentum. business strong year feel our competitive global remain value this our I fundamentals guided me deliver about for momentum is to times. setting further well IGNITE for my our

future. So even the will in what it's anticipate to hard near-term happen

the We continue our lasting and for in brands, growth on impacts potential categories behavior COVID-XX consumer meaningful trends our have believe on long-term engage our and to focus including to company. be anticipate to navigate global related consumers we to how leading value. what with people will unemployment And to recession, significant as looks pressures to that need will and spending spotlight continue a discretionary

We turning brands help also support families anticipate as Wellness on Health to will their trusted needs. stay the and to they to and safe as well them day-to-day keep

noted, Kevin significant the aggressive outlook and volatility behind and and investments portfolio year fiscal growth uncertainty, also our deliberate global 'XX As earnings longer and term initiatives. reflects our

'XX these our sales grow with to to During to year focus ambition 'XX elevated offense uncertain in a beyond we creation accelerate we times, plan off value on to long-term the And sales year base. year. fiscal of growth fiscal play an investing plan in fiscal continue

is you fiscal in expect can what Here year 'XX.

XX% advertising to about increase We will of plan sales. to

year strong purpose, fiscal brand will including innovation, We experiences innovation and shopping in 'XX. in behind our sticky innovating product frictionless invest pipeline

public we We will to the take that to our expand also, health so of out production we to customers, spending advantage but that together for better so of meet particularly fully consumer support with products, home. opportunity begin capacity capital increase can demand, can disinfecting

support which health leading respective with to and seen, as like expertise face Uber announced collaborating you've with United Theaters recently we've continue AMC Technologies, together Cleveland to keep support to brands As and And Clinic, to efforts Airlines we their their partnership we brings public all our our COVID-XX. capabilities safe. customers likely started

on about Harris XX,XXX for our continues all to ethics citizenship. Americans we a our service As with delivering that keep XXX, we it's vision, because We're with Strategy IGNITE our a dimensions: ranked the business on superior through culture, value, to consumers. know of for value last to and course, growth, right also do number everything one in And values of company, reputation Clorox proud The in focus products, centered business, integrated people winning US so our way, Company to week's of Axios continue our the now we'll creating growing based key that term seven trust, survey ESG corporate in be Poll of are stakeholders. we the and longer committed

profitable, and Linda. will sustainable. the focused Good Growth Growth. over with Clorox Now it remain that's to And future on in that let turn responsible me and

Linda Rendle

And Benno. everyone to hello call the Thanks, on today.

the reins me how with Benno let just that is After makes Clorox' truly to start saying excited Clorox is company. CEO. proud off what am about XX a special First, company, from be the most me I taking next by years

brands iconic lives that love people a our to have and We in better. role wonderful people's making team takes values-led heart

role portfolio and in with brands and beyond. to support homes, behaviors we're is believe just and company's position growth. consumer that time global for role their as 'XX build putting the than CEO. innovation of a brands our value. talked that team through clearer challenging for to shifting and look digital Clorox. us Under and our time for Whether to and other is shareholders fortunate the working thank take pandemic in with no CEO. introduced our engagement fiscal Benno's And been that's and Wellness mentor, Growth, is most terms forward Second, pivotal has Benno disinfecting experiences, closely work we Minerals to in society. profitable, a consumer I public creation. a products This about more this. Benno begin optimistic now the captures CEO growth and it I'm at it's earlier opportunity company It to products center, interact And that demonstrate even families on to for to may become continuing his with the taking society. is to count for to mindsets want a future investing investing behind our Profitable this at great the way business is people that superior before been we're next means Growth. or say I I all What's I by who its Benno better and accelerate we're through ambition our business on differentiating to each front clear forward fiscal to years. Supplements to critical a I've Q&A, he and our total our to over he value executive profitable our enhance and and didn't What's our Good this very to firmly one to the there company deliver that year guidance, support look the you long-term about. products terrific sustainable. doubled step the wellness, that up him level, the is essential leadership recognizing Clorox What with during and value momentum people Health accelerate our responsible big their to health, and my Vitamins, into for return also consumer year heart. to from have was He as shareholder to finally a simply address the personal strong that more opportunity what Operator, we in trusted and open health By as growth consumers, about achieved of commitment momentum on when to partner related and wellbeing. 'XX be to ESG questions. by right drive

Operator

line [Operator Teixeira Instructions] Your first from of question does Morgan. of come Andrea the JP

Andrea Teixeira

Benno, time for thank significant Linda all And you your years these and business and promotion leadership you. your on from agenda. Thank right. great congratulations the All

investment community the over years. all with So

way dedicate it's good at time So you more have to see Clorox forward. to that strategic topics to likely [ph],

you partners production a -- and the or business like with the new Cleveland XX can those the about and wanted the board bit partners Linda Theaters. So you on United I to partnership Clinic talk AMC with and also with if and agreements Uber,

So X% prior I I understand about your X% year. was just but opportunity. now I like size of remember it's this the in fiscal hoping about sales, you've being seen

this be BXB kind that with could this outpace congrats we if continue of can again, of how the to Thank and to BXC great. the -- you thinking us So you forward, idea both. going capacity? give against be will can you growth. And And how if debottlenecking we

Linda Rendle

Thanks, here. started Andrea. I'll get us

very mentioned what and International we as that role the about play broadly we are. US disinfecting in several portfolio, serious health. opportunity cleaning see Benno we're in And and high earlier, our as outline those public across level look I'll we the So at spaces and

you and The and not is people that that to first the possibly retail consumers this single-digit have number The one to of products is meet years. to high traditional are a X% the number in over with delight much a we getting is has space. can ensure we as true products is sales that supply space for professional business, about in the continuing demands during priority able We is which know retail they us 'XX year same grower time. need highlighted in of been fiscal our into

working of both So in those. on supply

With highlighted is those pursuing the aggressively the areas. opportunity merger you is that we're that one and of that two

United a reassurance enter their or partnering people is after would and Theaters and they Technologies. have in you do And clean like disinfected. that ensure people that of highlighted we're these safe. dedicated They be they mind. trusted supply. for to They in that by guests how like go partnerships thinking offer employees AMC we're with will team be are Clorox's forward with looking whether to opportunity. using brands reassurance calling brand be that space would be guests to and they public spaces can the really out a protocols what life, Uber re-enter Clorox, We welcome Clinic, getting space staffed That's we're home that businesses brands. and about have And is what are important As their that Cleveland moving reassured is though their and is resulted and back, that that things helping is What Airlines, the by their broader clean. reassured us the as

So we business for expand these us for supply in the those we're of think good are as think days. forward, are agreements, before is that's will about I but our we you do is in move the and what and total, have to consumer the response And today, increase thing we consider in seeing to and technologies markets very of with our to capabilities. all BXC test that and looking to if well we're we suited and continue initial stages continue BXB lines really what initial blur

Andrea Teixeira

you the you're how the now growing think your like capacity, XX%. And debottleneck last No, quarter? can exit exit quarter the that's see great. you also growth, capacity with like you as I I tracking

Linda Rendle

Yes.

but significantly pace we in we the QX, we what head on remain 'XX. we're into supply highlighted is versus in higher is key, plan as QX, elevated is that Our to what expected increase we demand that had committed expect than demand seeing and fiscal to Benno the year

we're satisfied that increase now, able improve. Cleaning But deliver levels did have on service clear, support supply highest strong our Our in and the to our we urgency with to were be we absolute to not right double-digit growth businesses.

pleased supply -- stable. fiscal see is our the we into our to we're and year Some of things state chain the 'XX though remains us as very move will give confidence that

case us have those where seen that We help aggressively expand disruptions. demand. prioritizing than we've increase very takeaway had Healthcare. of are bleach stock looking capacity. have that So to been, the and in some stronger at much suppliers. in more that key in The COVID retail were majority to fact the despite on recover had had the bring And is are to we we message than related they We of levels investing for in been the would begin XX we new quicker, disinfecting to few able businesses anticipated to support

meeting in way increase demand. entire through manufacturing, we back the We supply packaging 'XX in expect raw up and And year materials, the chain sequential in across into that are working fiscal conversion. all improvement

Andrea Teixeira

it I'll That's pass great. on. of and Thank you again, luck. best

Operator

comes the Wendy Our Nicholson line next of from question Citi. of

Wendy Nicholson

scheme grow to that's don't fiscal partners your as will you're and need revenues behind. assume Congratulations we've My that you to long things. level It a point in those because where question a time time or number advertising rounding of you, bit coming basis Benno miss now big surprised had I one, 'XX, that of I spend advertising. your seen I'm And meeting little time But we the And having you sort revenue that's still both do ad Hi. a with a highest kind actually it's to of demand. at right of that's increase. increasing you're be a XXX in targeting the increase spending you. to probably that hard are of great would for know you. for a

saw an or So Life, whether I ad not. buy would I Clorox

targeting there increase and can more So you're you bit we whether maybe something that is magnitude, should by Thanks. this driving spending talk level increase? going XXXX about ad to a that that new or to, specific businesses a forward expect is decision it little which the in that's that

Benno Dorer

an with you that should momentum It strategy. company you, investment the Thank on in our And the takeaway term. an always Wendy. that's is the of that into our this done Yes. is course, business. have with as confidence that is What we long- in also aggressive signals eye

level XX% across with, For challenges building see spite confidence comfortable strong earlier, promotion much opportunity invest particular mentioned we while that brands. the a I at company program, us health innovation we're a of we to supply have in in ahead. all core advertising the our be to And long-term quarterly our long-term in sales time to have as this a that and opportunity both very demand a is into pivotal accelerate investment growth. have as the in that go we this innovation. great we right we so will It well the continues of expense, have not businesses it's in now, opportunity for

shares strong So with to superior. fundamental of north or being shares, market is serve US business. QX to. the health future It the penetration our With stable with growing business; at in high business investment look are momentum. of drivers of its well And, being build of the opportunity long-term business portfolio. XX% north those if With this like International we perception them as consumers face household the of in value the of business I indicators our consumer you further with thing with is portfolio rising as our seen more All mentioned to at in XX% growing in of the market International, pandemic. particularly an right in out things our all-time feel of

playbook of at we that or So, in going is somewhat is the that here to it's and in US, ago. with right recession apply certainly which overlooked we part do, this underestimated thing we've the recession, about also all think significant and think this particular of simply particular against time, XX our to in be and the looming is once successfully perhaps before years

great part a company. long-term we this as strategy our confidence of have growth choice for in So,

Wendy Nicholson

so these say, or spent you And be much half versus would price first no How promotional just second you difference? specifically, to spending of versus is half. expecting half itself scenario marketing if spending. half those first second comments, the rollbacks where there are dollars of specifically, economic a better in kind the ad wow, or would deteriorates really environment

Benno Dorer

But for don't we the innovation Typically on, quarterly outlook. can timing instance, quarter certainly by launches. it provide vary depending of

can say in a It's right, see expense. you But cannot like business. expect though you we So us I variation. never, advertising know this never growth. Based on today, I an tactical what said, investment because should even not it's long-term that touch promotion sales in

people particular we worse, that a if many frankly, advertising in to looking promotion, remain rely spend will trusted that's us brands those sales more dollars. brands the of doing at to we as know, recession. on people And in this you to committed reason have So spending time, a particular at for needs. And even gets when in of meet the are trusted recession their

Wendy Nicholson

Thank much. Got it. so best again, of you luck. And

Operator

Our Modi Nik Capital of Markets. next question RBC comes from

Nik Modi

capacity. and in career, And make you is a terms very to spot uncertain. CPG The Clorox, category in tough out guess afternoon, for Linda decisions, is on capacity Good kudos growth a you do Yes. was question Benno I long-term like your everyone. of companies a the two had when remarkable how years on most decision I really appointment. on congrats profile

you Hidden at on home that's term and time, elevated longer that's may I future? talking guys your a not like in charcoal I'm So also I'm obviously the talking Ranch at how clearly also about and of into because and elevated it's at Valley is thinking remain and your to the consumption long but food growth all going just continue capacity? with analytics about for Thanks. just disinfecting, I'm moment decisions category are how guess, feeding asking, Clorox about

Linda Rendle

Thanks for the Nik. question. Hi,

approach the production. whether for the disinfecting right is look understand a So one going and at elevated where facing, given science mid strongly take or time we the mid we but that capacity predict allows address for for hard we category that. like. what But you're our to is do we're long-term and to we right, the we cleaning putting believe is analytics building how to example, we're right that to And whole precise a taking we're now it to what the to future future that long-term at will work sure you will on future are co-packers remain what we flexibility, if and this think not in-house us to that build make we're have to use

cost, helps now, and and we also that ratio appropriate, time, which we've suppliers right as XX perspective. an insource we've can us the help So to production over with added right said incremental us if balance new and quality to this it's efficiency us gets from production,

to really out. feel choices do us shakes on about I all that allow we're ability confident this to that pivot and So making where depending our

Nik Modi

just get think on the perspective 'XX. take I three next to or And to to take How want over level quarters will or it quarters to long for to of it you is any that? -- Linda, two be, your mean Clorox with that. fiscal expected around over is follow-up could going you demand I where if up do catch it

Linda Rendle

Yes.

do match. feel expect entirety then to the businesses, supply sequential to expect perspective, year, but And be see the and will we example, and really be throughout the be entire For a where pandemic Brita, year. end we like cleaning this to our improvement sits From fact middle year we'll the have given continue be get need the we portion full and fiscal will good that the to the disinfecting take the ramp-up of the Kingsford, of normalized good for we Glad, the to year, Nutranext, a at. over a and demand by with that of levels for to up the It year. fiscal of cold flu the we us in supply calendar,

Nik Modi

Great. helpful. That luck was good very the of to And both you.

Linda Rendle

Nik. Thanks,

Operator

Kevin of Our next question from comes Jefferies. Grundy

Kevin Grundy

to my pulls want as company. and question outlook into you it together extend congratulations elements Nik's is the the Wendy and Thanks. question. Benno term for -- couple a And My of Linda, well. tying But the from both I of to longer

a target lot of at mid-point the So given current dynamics is demand growth, and but sales we've certainly to low that particularly of and you really about, around in Wellness. beyond the X% outlook so and 'XX structural beyond, X% Cleanliness for to fiscal categories, these some core of inadequate looking to Health increased as look seems be that spoken the

we're You're capacity Wendy rightly and as pointed advertising lot clearly out, tracking investing marketing of the this a correctly.

sales of sort fiscal company. any since seen for as a haven't percent levels of XXXX the We

awful an So CapEx business. there the OpEx is investment, lot into going both of and

the So the what's certainly kind of in X% X% to seems right nothing reflecting is it range. certainly does now and stock

other the can the all capacity, as part your in around to being with today, investors the of be said, provide prepared or to what are of you when thinking company that an So will comment update extent to you investments planning around P&L.

So Thank would be you. commentary helpful? there any

Kevin Jacobsen

you're company. Linda we growth. X% to accelerate right Kevin. But Hey you're -- leaning And it's of from X% of our can right. our And today, and which a growth is now we take hearing are as IGNITE what part Kevin, Look, have an And that in. Benno myself, I is to clear, the question. aspiration think I it profitable this outlook is

of We categories. into consumers new our have coming millions

into these to the out raise have company. are is new the particularly for opportunities, to goals. home It out opportunities leaning over too goals accelerate with long-term five early Remember, of growth and us performance these go the our years. intent we of We

is So it's update it's doing. and But come -- the certainly work point, I at in the to of some investor the our would intention. us we'll that And early back what in but early say we're I'd innings But we're intent expectations, a that trust, leaning hearing our accelerate right you and that. little on to from for is do to you're too our say now. performance community

Kevin Grundy

on. fair Kevin. I'll it Thanks, enough. Okay, pass

Benno Dorer

Kevin. Thanks,

Operator

question comes Bank next from Our Olivia of of America. Tong

Olivia Tong

-- in professional obviously to congrats you. pretty meaningful you expansion customers and partnerships your losing talk new Linda the you obviously rapid endeavors without this bit pretty a Thank expand your Saudi expectations on JV could with a Benno about And your talked and And the your innovation. of by amenable more in there's the leaning if with the performance in obviously segment. All seems more Because, guys. a quite COVID to obviously seem deceleration you're further backdrop. been afternoon best next you're And old, you. you environment. And a looking to Good against the categories for It's Benno. about you potential Wanted because to international pleasure. and which little a the spending. to specificity provide bit into potential recession, of bit

the or up help you. So on of of us if your to advertising maybe do last so you to would drastic be in recession demand, that was catching talk still top super better. just to Thank a outlook categories what helpful. little you bit terms through understand That could promotional some how in had the of

Benno Dorer

I'll start and Kevin that. can then build on

recession, take see if recession. a in you what we typically the last So

as value, doing performed more a growth categories Hidden that. at-home Brita number than for eating You sense lower number see a But we'd see that a people of about our have to And intuitively Valley use have see now and in click, of categories expect very course, it's average normal to like an a there grill water sales if for again year. recession that Kingsford, occasions, businesses to as those less you additional you categories stronger well. superior more double water move what you'd have much makes a impact. bottled at-home, pandemic, see historically recession. X.X the And as actually And continue categories people in an filtered of is and then you right in

an course, on will point. of this it, we're also going now. recession, back this pandemic And the into innovation the with 'XX. offense we being there that So into portfolio fiscal outlook. consumer, as the includes our play call playbook created The a to difficulty been last formidable the the emphasize course, recession focus in is and intention will as strong And lapse is consumer seen But year playbook really in numbers. this on at pretty superior and a have - of by fiscal which be half value innovation includes momentum time for course, brands puts we and lot was and of year takes, as of value in so many to some investing our 'XX outlook what's the 'XX but again of recipe volatility of part XXXX

So we have a playbook. strong recession

we Our very recession-resilient, been very Managers XX nine a importantly, time at Senior experienced this. to last out where BU Management handle General and have been how a of the team team the typically experienced of has have portfolio with recession business and the knowing

certainly we Kevin, part and long-term we elevated certainly of you. the spend business playbook, any like advertising So sales additional thoughts the continue will established is health we from and in of have promotion the invest an feel to that.

Kevin Jacobsen

other years Olivia. through about recession the and the managed we recession Hey, ago. as relates it to last how couple just thoughts XX Maybe a

belief be fairly our resilient. said, to is, we've tend So categories as our and what seen Benno as

recession, business our at units period. over of grew the I XX look X believe you last sales performance our If business in that

not only recession period categories what also about drove also resilient the our have healthcare financial crisis. what of I'd So time. always but is crisis. 'XX-'XX, have been brands a think that the This back during was that to a been you note resilient, in have is, you have And

different. very it's So

much consumers and in did 'XX than engaged categories in our we 'XX. back more have We

And addition the relative highest the In XX% we household competition. company. to high we've identified CVM, as you portfolio about our an growing we're if that, history got at look stable to the with at superior of all-time in our of penetration or that had either

to of forward at look offer never in government into is item a I you And be our then, you the strongest this but having different consumers and been to what Clorox, So as continue is can seen three how for the the us portfolio I'd have recession, certainly unemployment during that to support in will to help as has this recession now benefits. terms that other tell through process stepped been you through this this that going is going only But obviously is, well. the right is out. ever most government about recession recession. see assume actively may support if we've We'll this consumers plays

plays overall into this see portfolio pretty heading out. of But And feel I we'll the our health about good recession. that so how

Olivia Tong

versus helpful. That's priorities history. a you're lot growth And with of obviously Linda, taking today then arguably over Thanks.

well. increasing first So for more rest stepping talk order the sure, if of professional, you're e-commerce and could as Disinfecting, them business the is relative Cleaning obviously the I'm is capacity for but about to support there one you up business prioritizing driving another? the obviously I'm wondering how

does for investment planning Thanks. And year? how then you you that any that that So signal some support way in about with in acquisition, how initiatives? thinking open are are of of those next allocating the M&A dollars you're JV to

Linda Rendle

Yes, Thanks. it one demand. excellence the The this the supply with head. priority and on number hit increasing absolute meet you year to is executing

conviction business We to across which we supply The must around. on in But have categories. on plan the be strong that we are passion fundamentals meet do demand. focused put will and delivering place, we better

my strength third and of to and us it long-term point. better we our than helped those have areas to us to team value given IGNITE opportunities around team IGNITE an volatile I'll center the we do there is, commits do, us do exist. global into. portfolio, people And of strategy, we putting the about these what the think own was our and me across we us those it we board, lean best is follow at around. that's people And Second, This conviction gets troubling it. in that that leave to of our had for what got lean areas the to lot done Lead going lead allowed quicker that us we them have passion what executive for money you the innovating times. We're what in strategy is knowing people committed want over really that to anyone, into ever team than have we to X,XXX and what always is, communities and I certainly how investment we that's the for opportunities then of one right pandemic we has many where we've talked to consumers passionate last and to the Architect serve we'll And and creation and a of that, the we're months work. the a Where and we're place Cleaning is with the experiences with creating that everything continue we and products, as lead us work through globe. strategy. great And has imagined. and accelerate we last, going re-imagine will in

now ability we'll Moving will workers work feel do do our at suited pivot about imagine categories essential technology and number to to the it's we but We XXX% on confident serve consumer today. to make to decisions region. in for We've again 'XX, family-owned we growth put put managed our we've That Saudi focus core. and Health full running business. our business like the we products where know tremendous years, Wellness. where core NASA business core, to in saw to it's to able our the been have that is people to strong home, long-term work with on continued XX for that to and is in focus joint time. focus. margin what in Arabia a business use and is a investment from and of is a in we Saudi growth It continue year. highest that where a that the offense future. our be then year excuse demand really core keeping countries will best We our we'll Cleaning are in And always and venture for investment It's of for the double-digit to me, feel accretive business Arabia that has the We healthy get actually we turn and and speed. fiscal quick the high confidence return, manufacturing playing the this we brands choices And those continued years company. many those the and a Gulf But

leaning this are and in which areas have profitable stable us. into focus rate growth us isn't about and accelerating to a just what ensure International, is growth for this right on talked we So a but run that can we churn, is that long-term

Olivia Tong

Thanks very best. much. All the

Operator

Jonathan Our is Consumer next Edge. from of Feeney question

Jonathan Feeney

to some retail. versus two last household gave Thanks both I congratulations to Benno very you my for add question. me let on Thank Linda. helpful wanted very, there. us very follow-up breakdowns And and -- penetration guess quarter of you. in the questions much I

-- -- additional you households, any Are worry don't months particularly new among us First, about new -- about at repeat buy to rate? to coming more about can been And this update and give claim your of can have Thank has much give know, what a new third now quarter tell household you. behaviors? this those more new store in behavior, -- people how particularly us people into growth you I for you new back second, Cleaning us a wipes. cleaning the some [indiscernible] Any and users, users. few

Benno Dorer

towel higher care, people less in of little very, have. strong initial on healthy is ever seeing home growth Burt's some segments, seeing demand and major strong Double-digit people categories. Kingsford, of they are household that's is, our as than caused particularly loading, store as and Jonathan. higher consumer What are more picked lower we're Thanks, by such all where lets four majority a the increases of strong maybe certainly we've we're Consumer and very with it's we're an also and growth really Bees, is penetration fundamentals our more elevated many higher traffic quite QX in out purchase in occasions here. cleaning And disinfecting frequencies. think course, very of people all trough as you consumer up a all beyond we're the categories purchase to Yes. usage household more in household across categories and noted and put and which example, a very $XX where product staying seeing, But on behavior, We pantry stock-up, growth I I maybe seeing makes that very, category-wide would litter, the incremental categories, to going the at want very exception usage sales growth, penetration again see household fundamentally as but frequency advertising I time if beauty which then is by seeing seeing while and most category year. pandemic, fiscal home. and where point the sense sales million strong. leading on in categories in certainly And our half we closings we and food it's you the in to and using fueled increases like categories, broadly penetration in stay the for obvious, it's led in in this indicators strong also say been but color in first promotion the but facial that also fundamental in pressure several the Kingsford last more is driver usage back increases, underlying is majority frequency. in by penetration also a of from healthy. has encouraging indicating but vast very cosmetics, double-click the the that

that purchase buy of like consumption people seeing Grill charcoal. consumables course, are to more and Grills, of We increase leads more

we're seeing we've millenials are been seeing on with that's come come if a Thank big use strong millennials need grow know that and complete don't we're now penetration into a we category the growth seeing reason so to able incredibly household millennials we're you We category, category. I enter come them why people in, into seeing John the new the A even phone mute. with product is we're back the you. often. assets. But seeing

this for our mid-term. continue metrics So behind underlying and to expect growth positive sales lot of QX sure we

Operator

Our next of from Barclays. question comes Lauren Lieberman

Lauren Lieberman

international -- But Linda, that International. joint also. and get right mentioned has go I Arabia growth venture and that if few of you about the current terms years. the the Good in company of on and of you the where But not? global. the a strength the a you tight to I and from both Linda of role International Clorox do international play that years profitability, morning several consumer ago, think Thanks. presumably in last not, times talk landscape, the think have something why XX of been today at degree months you of very bigger Maybe There I wanted you terms the and think has aspirations? and were focused little -- more if setting you the to about for both guess, versus were strategy need sort Clorox does what cost to really does IGNITE brand would and word looking your has the control lean, on enhance I has flexibility models congratulations know Saudi bit you been proud for been I many is mentioned playing. Thanks.

Linda Rendle

Lauren. Thanks,

business strongly. see to if absolutely US we percent So the chain are the have of What and to grow change demand in both our the the opportunity between moving don't we consumer fundamental support about composition in ability take both. International. meet three things we're focused that the We in US to with you we're the a there the expansion opportunity in specifically, away quickly and supply And to more see think investments International. But want I you on. International is,

and we're to the on the US. the that need locations. is, we're have first are supply the we just in have to already we focused that in just products we like The And demand we already increase markets in meet in those that

opportunity product in countries compete an The absolutely today. we forms in to is, expand our we second have

geographies different and there offering So third, evaluating are areas we be into see penetration world. for expansion And don't wipes we market can many if of places look we from the low particular. interest, and in different are world high ready Clorox being consumers play have in we it's strong the as world brand new where we around entering then to an or investments. where see interest that that consumers for example, in see parts we disciplined we will certainly return that And for see of there the might whether and the the long-term approach is very take on

when consistent how the we approached And of would very in definite pursuing in think aggressive how change No is, And be leave opportunities So them. play we've you with in role what with overall International. to it portfolio. that our will opportunity confidence I we in International be we'll will that's date. have terms in about

Lauren Lieberman

a then, question if also And competition. Thanks. I may on just

So reasons of some kind the you to materially players, were and may it part gauge performance it both all not I that why what channels curious you've business, went through share Clorox of hallmark share thinking competitive big on and what's more tracked -- increase reasonable went least how think equities, in really in of looking clearly has midsized in of brand is best an you your Historically, of categories. brands is, still of your brands at kind very market sort in phases. of be dynamics, in and more play the about with strong actually been going

we're today. midsized where to going aren't categories talking anymore Your with possibly

So what change, about do What that? categories competitive -- changes. thinking how dynamics are landscape you in those the do you the

Benno Dorer

are mean I space. look -- an in assume particular, our we can been have the They assume There will think Lauren. they in be reasonably no you, and always competitive that that question. And competitive. it's space is attractive also competitive. disinfecting Thank very competitors I our categories,

at and profitability Looking the time. go been, competitive. we can We commented commented value few around innovate, will to to growth the and them. best be on and But build very And daily the sharp keep for for more so bread consumers a world how been And times shape. it's make daily behind great that's a invest We with a many We innovate. our do expect and we've that also us the that's that? the generally has how leading long about brands. as we we've long-term. ability innovate, in difference bread that the brands shape eye those We we the and are invest an in ever our

as and we're came earlier, XXX% our certainly competition try a and the lot of a play competition we times and without to said So defend arrogant, not Linda in will we disinfecting turf and time. used home went, the of competition in come we offense will to are for to and and sounding waiting importantly and come

to company. very in long-term flexibility But So, to business the ensure our in to you the we that it ready assume noted, financial taking with business to have we is success and be continue order going we're competitive. for growth as are and can accelerating for this stance of invest aspiration the certainly an

Lauren Lieberman

and much congratulations, so Thanks Okay. again.

Operator

Our next Bank. Deutsche question of is from Steve Powers

Steve Powers

supply an demand arguably missed I Thank hoping to you. way line I is the And range 'XX the I'm about volatility I pressures competitive guess, of And about you've fiscal more well fairly sincere you out. I line as was Lauren how talk dynamics well big more congratulations congratulations see from thinking and that constraints, some interested to alluded in called recessionary as drivers just that narrow specifically biggest underlying and obviously I Benno. Linda guess could a relative the you're top as what wide too. me range bottom margins. gross for you're

of as gross to there So margin driver guidance? is a about 'XX a way talk

Kevin Jacobsen

that wider providing see we our areas this I I'd say, typically And what say year gross year is that our Steve, our talk your And is on range I'd we to to provide two about normal really and EPS Kevin. is end. wider margin. both than point, by we're a driven increased that range expect in variability this results. can range EPS

The top obvious. how on The that's the will the of that COVID-XX. out impact think portfolio I recession, our predict year. will is first clearly impact the pretty probably line, course to and play The difficult ongoing over of of be full the

lapping we for will as us year difficult near we're think term. the the the got I out. look and play year, into we've very XX% to visibility from organic decent more growth of half exactly But out over where as we back the determine get that last

level which the chain, supply would look seeing and And of top of variability that, is driven addition we the we're logistics million to time. of COVID-XX previous temporary terms dimensionalize 'XX, $XX And how variability you plays top be by so be incurred variability, a when up chain quarter, from forward into supply be in our look will over that where there to But our from I I to fourth some line. in we diminish outside about to in as in expect and clearly our charges I to in out, expect had we the a and increased we of COVID-XX. of expect pandemic is years manufacturing impact them the say from see charges at line will specifically related maybe our now lot control. those to

point it's difficult you this land. million it where X company. margin our in to And growth think of for so about change is gross EPS worth And $XX profitability call if about exactly

as it's the could would for $XX $XX the performance And supply our and point that or X relates we inconceivable the to X the year, to change the of in it so not million million variability of chain EPS see COVID that point over impact course year. generate

hitting have the EPS the you variability the a top why at chain, the so think COVID look I to range the our in wider you at reason the look when And line, variability year. start that's supply we cause on

margin. EPS. gross in we the land COVID up negative for where cost Now think I because on we relates as line be we EPS it margin actually larger If with be had conversely, with supply end doing gross and margins to much chain years declining margin, if very And cost in anticipated generate year. we for will we by driven than it growing than anticipated gross year this likely growth the and COVID EPS we better

terms we'll right to early obviously of And but I start start in range this seeing as with the get year the to so certainly like in the as now. to we that's learn think we're it's how more we how It's we smarter, going year, said. land, feels think we update prudent place very you a

Steve Powers

put of, is particularly also while your year interested numbers fair. you've called you're of cash Thank way uses just you that. the you in I for that's and kind ramp guess, out? that next that there CapEx, some Yes, talking, I'm can a around the expectations manufacturing cash, for generation given

Kevin Jacobsen

Yes.

as access company. as of it maybe cash with we're relates significant and specifically to So CapEx, a generating cash

my up the I of six tell in 'XX. think remarks, it's saw about year, we although I'd cash the XX% prepared fiscal the months half for rate you we doubled are fiscal in generating over full year you the year had back of last

And financial accelerate performance company the our from us the the the today that, to business intent putting in we're terms cash access position very allow of is invest you're good are over to again doing to is, three business. we to hearing cash what the of So into long-term. us and just taking in with we're that in our

expansion fourth investing additional the CapEx, We $XXX end Typically, been the us. of a that over in we've years, say We back quarter. below over and sales us are that as also year. I'd a X% As closer capacity somewhere primary as capital you X% and sales. the spending low between in if started year of for fourth look the it last each investing invested last few we our just specific quarter the company, X%. a about to to focus little relates million is revenue put is percent of of capital X% in range,

a as particularly X.X% spending as capital and of invest forward into percent we up capacity I to between continue end think expansion disinfecting, X% As look sales 'XX, Steve, in to I we'll somewhere in $XXX and in And work I us assumption the that puts spending for you now to that's a the to if math, CapEx us about that million think probably good do for with. pretty gets year.

Steve Powers

again. Congratulations you. and Linda Lisah Thank I sorry sense. Benno. mean -- Makes

Benno Dorer

Steve. Thanks,

Operator

is Our English next Goldman question Jason from Sachs. of

Jason English

afternoon, well banter. your quarterly and fill Benno And wish to last miss I'll congratulations I that sentiment, and you going Hey. folks. Good Linda I'm

can in revenue. growth Why in levels. for a everything and could my outstripping surprising quarter The sequential so meaningfully is shipping XX% everything outstripping guys to fourth of It demand is selling questions. the and so on your robust organic you pretty quarter, still any into is guidance -- selling sales say your it's massively and of of So deceleration, what translated your match you nearly albeit little supply? that much context you couldn't $X strong supply billion you're that you bit the and first demand a if

Kevin Jacobsen

Jason, Yes. is this Kevin.

your some QX question it double-digit half specifically in expect and growth guidance, provide really we QX, helpful thought point. think provide quarterly was and line I we is while said we we what to to perspective top back half, is, don't to typically do your front

we our to In expect continue near demand first a ability expect because outstripping It see is continue quarter. that, of products. very for term, to our do to that and we the strong very strong We supply.

Jason English

a given in is I'll was like over to price and later. the quarter? the suspect components supply-demand that's we promotions. lot trade growth, it meaningful the quarter a expectations I through market, out look imbalance. based I your expect as contribution pulled waning promotional imagine your similar with price programs spent on this On that moderate the of one of of year. What progress contributor could of and obviously even the the Okay. on we that try offline cadence Should first faster? Or quarter

Benno Dorer

categories peak instance is Yes. Memorial able been that of Jason grow in of of holidays what's there usually lot hasn't Day. as is promotion It's noted, or healthy -- events and Kingsford encouraging promotion a on Xth for July part our for double-digits during price without price there a were there are what we you pretty sure. clearly to like

if our vast customer encouraging. customer you all spend, majority of there. and trade our that's our trade But to think about spend the trade the performance is spends, tied meaning performance is So performance-driven, it's

spend, that's -- of everyday a aren't spend the are commitments pricing. in into trade the there there rolled honoring of many continue. So going lot to for our is savings we're and because because customers trade low And

a next big you could a not continue. the of also and going lower So little going in going trade as by quarter be have as trade is to windfall there it's fiscal a savings But you It's that about to spend vary will going be QX is not source over year. think noted. been spend, And to forward.

Jason English

you Okay. pass I'll on. it Thank very much.

Operator

from Bolton-Weiser question Davidson. final D.A. of comes our And Linda

Linda Bolton-Weiser

question. Hi, taking thanks my for

the does charcoal? that we it share pellet small share Thanks. was at launch improving. more your if some the it, you the your but point? recovery and channels there expect was hickory wondering in is made or that can when share And the what's and about in charcoal You tracked look driving comments specific category least could this general next important too growth at like innovation just I the own And is be about growth in

Benno Dorer

just retailer Thanks, of improved end a a to as face support a the much we implemented and Grill would it. more were strong that I in good welcome plans, in Yes. in and nice to came that characterize That's had pandemic. looking led Linda to time back. Kingsford really as way story consumers which

a strongly. the it So digits. turnaround really weaker growth. certainly look penetration consecutive double quarter support the returning businesses And story growth, after of nice quarter up a it's and at up you Share to It's household retailer our share-wise. factors, QX -- strongest mentioned, second one is growing underlying with period as strong if was of

all category, without heavy it On it's holiday aggressive discounts, encouraging. sales, Grill really of a even growing brand, the the peak

factor on clearly good strong is growth, is lost vast the a the the not also just that years, the category off the and sales the think building news to we we can in sales left, things But And been majority continues 'XX do growth scheme Pellets start, in is from the performance to are on previous So the share recover share as there of but about just it a scratching is, what to has in the itself will so year surface we really fiscal opportunity strong also growth. grand is keep trend. given a core. and also much of benefit and really build of season.

enter we So really on solid much momentum ahead. Kingsford with year opportunity as so fiscal 'XX

Linda Bolton-Weiser

you and good luck. Thank

Kevin Jacobsen

Thanks, Linda.

Benno Dorer

on joining and and thanks today. healthy, paths again all I hope you and of everyone will we Clorox's Lisah you and no, stay at Thank some will and year will on get everybody. Linda -- after well also X. all. Thanks, please that this XX to QX speak November meantime, through our Thank your November Kevin Linda, for us And families pandemic. hope results to again you you, in stay I cross about the point that 'XX fiscal

Operator

today's call. Thank conference concludes you. This

disconnect. may You now

The Clorox Company (CLX) 3 Aug 202020 Q4 Earnings call transcript