Consumer products maker Clorox Co. (CLX) reported Friday a profit for the first quarter that declined from last year, despite sales growth, reflecting lower gross margins and higher losses from discontinued operations of Clorox Venezuela.
Both adjusted earnings per share from continuing operations and quarterly sales topped analysts' expectations. The company also reaffirmed its earnings and sales growth guidance for the full-year 2015.
"I'm pleased with our solid start to the fiscal year. In the first quarter, we continued to invest in incremental demand-building programs to reinforce the value of our brands. As a result, despite continuing headwinds, we delivered sales and profit growth for the quarter and saw improved market shares in a number of our categories," Chairman and CEO Don Knauss said in a statement.
The Oakland, California-based company reported net earnings of $90 million or $0.68 per share for the first quarter, down from $136 million or $1.03 per share in the prior-year quarter.
Earnings from continuing operations for the quarter grew to $145 million or $1.10 per share from $139 million or $1.05 per share in the year-ago quarter.
On average, 16 analysts polled by Thomson Reuters expected the company to report earnings of $1.03 per share in the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter edged up 0.6 percent to $1.35 billion from $1.34 billion in the same quarter last year, and topped thirteen Wall Street analysts' consensus estimate of $1.33 billion.
Currency neutral sales growth was 2.5 percent, and volume growth was 1 percent, reflecting increased shipments in the international division, charcoal and natural personal care businesses, partially offset by decreases in the home care and laundry businesses.
The sales growth reflect the benefit of price increases in international markets and higher volume, partially offset by the impact of unfavorable foreign currency exchange rates as well as higher trade promotion spending.
Clorox's cleaning segment net sales declined 2 percent to $470 million, while household segment net sales grew 5 percent to $392 million from last year.
Lifestyle segment net sales edged down 1 percent to $216 million, while international segment net sales remained flat with last year at $274 million.
Gross margin for the quarter decreased 70 basis points to 42.8 percent from last year's 43.5 percent.
Looking ahead to fiscal 2015, Clorox continues to anticipate earnings from continuing operations in a range of $4.35 to $4.50 per share on projected about flat sales or 1 to 3 percent sales growth on currency-neutral basis.
Street is currently looking for full-year 2015 earnings of $4.42 per share on annual sales of $5.57 billion.
The company also said it expects to recognize in discontinued operations after-tax exit costs and other related expenses of $60 million to $65 million in during fiscal year 2015, as well as about $10 million to $15 million in fiscal years 2016 through 2018.
In Friday's regular trading session, CLX is currently trading at $98.83, up $0.23 or 0.23% on a volume of 0.15 million shares. In the past 52-week period, the stock has been trading in a range of $83.70 to $100.00.
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