Clorox Earnings Jumped 28 Percent in 2nd Quarter on Swine Flu Fears

February 4, 2010 - 10:18 AM
Clorox said both U.S. and international sales of its disinfecting products benefited from consumer demand associated with the H1N1 flu pandemic.
Chicago (AP) - Household products maker Clorox Co. said Wednesday that its second-quarter profit jumped 28 percent as it continued to get a boost from sales linked to the swine flu.
 
The company also improved its outlook for the full year.
 
Clorox said both U.S. and international sales of its disinfecting products benefited from consumer demand associated with the H1N1 flu pandemic.
 
Favorable foreign exchange rates also contributed to the company's strong quarter.
 
Net income for the last three months of 2009 was $110 million, or 77 cents per share, up from $86 million, or 61 cents a share, a year earlier.
 
The earnings were a penny better than the consensus estimate of analysts surveyed by Thomson Reuters.
 
Clorox, based in Oakland, Calif., is known for its namesake bleach, Kingsford charcoal and other household products. Its cleaning products had boosted results in the first quarter, and analysts weren't sure whether that momentum continued in the second quarter as fears of the H1N1 virus faded.
 
Chief Executive Don Knauss said the company spent more on marketing and other areas to ensure continued loyalty to its brands in a tough economic environment. That helped increase sales in three of its four product segments, even though its prices were higher than competitors'.
 
"We increased the investment in our brands, with more advertising to build long-term brand equity and higher trade spending to impact short-term competitive price gaps at the shelf," he said in a statement.
 
Clorox raised its outlook for full-year earnings by 5 cents per share to a range of $4.10 to $4.25 per share. It previous forecast earning $4.05 to $4.20 per share.
 
For the first six months of its fiscal year, Clorox reported earnings of $267 million, or $1.88 per share, up from $214 million, or $1.51 per share, for the same period a year earlier. Revenue rose 2 percent to $2.65 billion from $2.6 billion.