Clorox posted its highest sales growth in 'modern history' last fiscal year, CEO says
- Clorox posted a 24% increase in organic sales last quarter and a 10% increase in organic sales in its latest fiscal year as the company benefited from the coronavirus pandemic, CEO Benno Dorer told CNBC.
- "We're seeing broad-based strength, and it's certainly in part function of the fact that our products and brands are serving so many more consumers today in the face of the pandemic," he said in a "Mad Money" interview.
- Dorer, who is stepping down as chief executive next month, said the company will "continue to play offense" under incoming CEO Linda Rendle.
Clorox posted its strongest sales growth the company has seen "in modern history" after closing out its fiscal year in the middle of the coronavirus pandemic, CEO Benno Dorer told CNBC Monday.
The consumer goods company, whose brand name is virtually synonymous with bleach, saw organic sales growth of 24% in the fourth quarter and fiscal year organic sales increase by 10%. All four of the company's segments, which include cleaning, household, lifestyle and international, were up double digits, Dorer told Jim Cramer.
"We're seeing broad-based strength, and it's certainly in part function of the fact that our products and brands are serving so many more consumers today in the face of the pandemic and people staying at home, but we also are seeing much-improved core health fundamentals," he said in an interview on "Mad Money."
"We're seeing growing market shares, we are seeing growing household penetration, we are seeing the percentage of our portfolio that is seen as superior in value by our consumers at an all-time high."
Clorox beat quarterly estimates in the April-June financial period. Net sales came in at $1.98 billion, up 22% from the $1.63 it recorded the year prior, and net profit came out to be $310 million, or $2.41 per share, almost 29% higher year-over-year. Wall Street was expecting revenue of $1.87 billion and earnings of $1.99 per share, respectively, according to Factset estimates.
Clorox projected sales would be flat or grow slightly in the current fiscal year and that profit could either slip or increase in the mid-single digits. While some in the investment community saw the guidance as conservative, Dorer told Cramer that Clorox sees the outlook as "appropriately balanced in the face of uncertainty."
The company is investing in advertising to reach more consumers, expanding building capacity to take advantage of increasing demand around the globe and enhancing the business, he added.
Clorox's fiscal fourth quarter will be the last three-month financial period that Dorer, 56, will oversee as chief executive of the centenarian company. He will step down on Sept. 14 and retain his position as executive chair of the board as Linda Rendle, 42, who has been with Clorox for nearly 20 years, will take over the company and join the board.
Rendle will be promoted from her post as president of Clorox.
"We want to continue to play offense and we want to take a long-term view of this pivotal opportunity that we have now, and for that, it's a really great opportunity and thing to have to have a CEO at the helm who has a long runway ahead of her," Dorer said.
Shares of Clorox fell almost 2% in Monday's session as the stock price retreated to $231.96.
The stock is up more than 50% in 2020.
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