Clorox cuts annual profit forecast as demand softens
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A Clorox worker walks past the's company logo at its headquarters in Valles del Tuy, in Miranda state September 26, 2014. Hundreds of workers on Friday were occupying two plants belonging to Clorox Co, the U.S. cleaning products maker that has left Venezu
(Corrects headline and paragraph 1 to say the company is battling softer demand and rising costs due to the impact of the Iran war, not weaker demand for cleaning products)
April 30 (Reuters) - Clorox cut its annual profit forecast on Thursday a the bleach maker battles softer demand and rising costs due to the impact of the Iran war, not weaker demand for cleaning products
Higher energy, fuel and freight costs tied to the war are pushing consumers to cut back on discretionary spending, including on branded floor cleaners and disinfectant sprays, stoking concerns about margin pressure for consumer goods makers like Clorox.
The company now expects annual adjusted earnings per share between $5.45 and $5.65, down from its prior forecast of $5.95 to $6.30.
Clorox also said it expects its annual gross margin to fall by 250 to 300 basis points, citing headwinds from the higher energy costs as well as costs related to its acquisition of Purell maker GOJO Industries.
Earlier this month, Clorox completed the acquisition of GOJO as it seeks to expand its portfolio in the health and hygiene segment.
“Looking ahead, we recognize there is more work to do in what continues to be a challenging consumer and cost environment,” Clorox CEO Linda Rendle said.
The company expects annual net sales to fall 6%, compared with its earlier forecast of a 6% to 10% decline.
The Pine‑Sol parent reported adjusted earnings of $1.64 per share for the third quarter, beating estimates of $1.55 per share, according to data compiled by LSEG. Quarterly revenue of $1.67 billion was largely in line with analysts’ expectations.
(Reporting by Koyena Das in Bengaluru; Editing by Sahal Muhammed)
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