Church & Dwight (CHD) Reports In-Line Q3 EPS

November 3, 2016 7:02 AM EDT
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Church & Dwight (NYSE: CHD) reported Q3 EPS of $0.47, in-line with the analyst estimate of $0.47. Revenue for the quarter came in at $870.7 million versus the consensus estimate of $884.82 million.

Matthew T. Farrell, President and Chief Executive Officer, commented, “We are pleased with our Consumer organic sales and the company’s earnings growth as our business overcame continued headwinds faced by our Specialty Products business. Our continued gross margin expansion in the third quarter provided us flexibility with our marketing and promotional investments to protect and grow our brand equities.”

Outlook for 2016 and 2017

Mr. Farrell stated, “2016 has been another excellent year. We are positioned to continue to deliver strong sales and earnings growth with our balanced portfolio of value and premium products, the launch of innovative new products, aggressive productivity programs and tight management of overhead costs.”

With regard to the full year, Mr. Farrell said, “Our global Consumer business continues to perform well. We now expect reported and organic sales growth at the lower end of our 3-4% range for the total Company which reflects approximately 4% reported and organic sales growth for global Consumer Products partially offset by significantly lower Specialty Products sales. We continue to expect gross margin to expand by approximately 110 basis points due to continued lower commodity costs and greater distribution efficiencies. Operating margin is expected to expand approximately 60 basis points when adjusted for the 2015 pension settlement charge.

We are tightening our EPS growth at the lower end of our previous range of 14-15% reported and 8-9% adjusted to 14% and 8%, respectively. This outlook is top tier within the consumer packaged goods industry.

For the fourth quarter, we expect reported and organic sales growth of approximately 2.5% for global Consumer Products. The Consumer organic growth will be partially offset by continued headwinds in the Specialty Products business resulting in a net 1-2% reported and organic sales growth for the total Company. EPS is expected to be $0.42, a 2% increase over the prior year quarter. The prior year quarter included a $0.01 benefit from the full year 2015 R&D tax credit.”

Mr. Farrell concluded, “Our planning process for 2017 will be finalized over the next several months. Based on the Company’s current growth momentum, continued focus on innovation, and confidence in gross margin expansion, we expect to achieve high single digit EPS growth in 2017 excluding the adoption impact of an accounting change related to stock option compensation. This represents top tier results within the consumer packaged goods industry.”

For earnings history and earnings-related data on Church & Dwight (CHD) click here.



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