- Church & Dwight Co Inc (NYSE:CHD) reported first-quarter FY22 sales growth of 4.7% year-on-year to $1.297 billion, marginally beating the consensus of $1.290 billion.
- Organic sales grew 2.7%, driven by a positive product mix and pricing of 7.8%, offset by a volume decline of -5.1%, reflecting the impact of continued supply chain disruption and pricing elasticities.
- Net sales from Consumer Domestic rose 5.6% Y/Y, Consumer International fell 0.8%, and Specialty Products grew 9.2%.
- Gross margin decreased 190 basis points Y/Y to 42.6%, affected by higher manufacturing costs.
- Operating margin compressed 280 basis points to 21.6%, and operating income for the quarter rose 7.2% to $280.7 million.
- The company held $174.4 million in cash and equivalents as of March 31, 2022. Net cash provided by operating activities for the quarter totaled $152.8 million.
- EPS of $0.83 beat the analyst consensus of $0.77.
- "Looking forward, we expect input and transportation costs to remain elevated and we now expect an additional $85 million of cost increases in 2022 vs prior expectations," said CEO Matthew Farrell.
- Outlook: Church & Dwight continues to expect FY22 sales growth of 5% - 8%. It expects FY22 EPS growth to be about 4%, the lower end of the 4% - 8% range stated earlier.
- CHD continues to anticipate full-year reported gross margin to be down versus 2021, as it expects inflation to be partially offset by pricing and productivity.
- For Q2, CHD expects reported sales growth of 5% - 6%, gross margin contraction of 200 bps, and EPS of $0.70, an 8% decrease Y/Y.
- Price Action: CHD shares traded lower by 2.59% at $101.46 on the last check Thursday.
