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Record shipments of disinfecting wipes and toilet bowl cleaners helped Clorox deliver better-than-expected earnings during the last three months of last year.
The maker of a range of consumer products, including liquid bleach, Glad trash bags and Burt’s Bee products saw net sales rise 4.5 per cent to $1.4bn during its fiscal second quarter. Net earnings was flat at $149m, or $1.14 per diluted share as the sales gains were offset by a $21m impairment charge Clorox had to take on Aplicare – the antisepsis business it acquired five years ago.
Adjusted for this and discontinued operations, earnings came in at $1.25, ahead of analysts’ expectations for $1.21.
“I’m very pleased with the results we’re reporting today, the highlight being we delivered our second consecutive quarter of 8 percent volume growth,” said Clorox chairman Benno Dorer. “This is the highest volume increase we’ve seen in nearly 10 years, with gains in each of our segments in the US and International.”
As a result Clorox is raising its full year sales forecast for the fiscal 2017 year. It now expects to sales to grow between 3 to 4 per cent, compared to its previous sales outlook of 2 to 4 per cent growth.
But at the same time it is also lowering the top end of its earnings guidance for the year. It now expects diluted earnings per share from continuing operations to be in the range of $5.23 to $5.38, versus the previous outlook of $5.23 to $5.43. The change it said reflects “a 5-cent reduction in anticipated benefit from adopting Accounting Standards Update (ASU) 2016-09, issued by the Financial Accounting Standards Board, related to the accounting of employee share-based payments.”
Shares in Clorox, down nearly 7 per cent over the past 12 months, rose 1.3 per cent in pre-market trading.