10-KPeriod: FY2024

CHURCH & DWIGHT CO INC /DE/ Annual Report, Year Ended Dec 31, 2024

Filed February 13, 2025For Securities:CHD

Summary

Church & Dwight Co., Inc. (CHD) reported solid net sales growth of 4.1% for the fiscal year ended December 31, 2024, reaching $6.1 billion. This growth was primarily driven by favorable volumes and pricing/product mix across its Consumer Domestic and Consumer International segments, bolstered by recent acquisitions. The company's gross margin also saw a healthy increase of 160 basis points to 45.7%, benefiting from productivity programs and a favorable tariff ruling, although partially offset by higher manufacturing costs. However, operating margin declined significantly due to a substantial non-cash impairment charge of $357.1 million related to its Vitamins, Minerals, and Supplements (VMS) business, which negatively impacted diluted earnings per share. Despite the VMS impairment, the company demonstrated strong operational cash flow, increasing by $125.6 million year-over-year to $1,156.2 million. CHD also returned significant capital to shareholders through dividends and continued to manage its debt effectively. The company strategically expanded its global presence with the acquisition of Graphico in Japan and continues to focus on expanding its e-commerce business, which now represents over 21% of consumer sales. Management remains focused on strategic initiatives including cost control, new product development, and pursuing accretive acquisitions to drive long-term shareholder value.

Financial Highlights

56 data points
Beta

Revenue

$6.11B

45.7% Gross Margin

Net Income

$585.30M

9.6% Net Margin

EPS (Diluted)

$2.37

Total Assets

$8.88B

Cash & Equivalents

$964.10M

Free Cash Flow

$976.40M

Financial Statements
Beta
Revenue$6.11B
Cost of Revenue$3.32B
Gross Profit$2.79B
R&D Expenses$139.70M
SG&A Expenses$927.80M
Operating Income$807.10M
Interest Expense$95.00M
Net Income$585.30M
EPS (Basic)$2.39
EPS (Diluted)$2.37
Shares Outstanding (Basic)244.40M
Shares Outstanding (Diluted)246.90M

Key Highlights

  • 1Net sales increased by 4.1% to $6.1 billion, driven by growth in Consumer Domestic and Consumer International segments.
  • 2Gross margin improved by 160 basis points to 45.7%, supported by productivity gains, favorable price/mix, and a tariff ruling.
  • 3A significant $357.1 million non-cash impairment charge for the VMS business (VITAFUSION and L'IL CRITTERS) negatively impacted diluted EPS.
  • 4Operating cash flow increased by 12.2% to $1,156.2 million, reflecting strong cash generation.
  • 5The company expanded internationally with the acquisition of Graphico, Inc. in Japan.
  • 6E-commerce sales represented 21.4% of total consumer sales in 2024.
  • 7The regular quarterly dividend was increased by 4% to $0.295 per share, effective January 29, 2025.

Frequently Asked Questions

The primary driver for the decrease in net income and diluted EPS was a significant non-cash impairment charge of $357.1 million related to the Vitamins, Minerals, and Supplements (VMS) business, which includes the VITAFUSION and L'IL CRITTERS brands. This impairment was due to continued decline in market share and financial performance of this segment, largely attributed to increased competition from new category entrants and private label products.

Net sales grew in both the Consumer Domestic (3.5%) and Consumer International (9.8%) segments. The Consumer Domestic segment saw growth in brands like THERABREATH, HERO, and ARM & HAMMER, while Consumer International benefited from acquisitions and strong performance in brands like OXICLEAN and THERABREATH. The Specialty Products Division (SPD) experienced a 5.5% net sales decrease, primarily due to the exit of product lines like the MEGALAC supplement portfolio and the sale of the Passport food safety business.

Church & Dwight's growth strategy focuses on maintaining competitive marketing and trade spending, controlling costs, expanding online market share through e-commerce investment, growing its international presence, developing and launching new products, and pursuing strategic acquisitions. The company aims to balance its portfolio of premium and value brands to appeal to a wide range of consumers and economic environments.

The company has a strong liquidity position, with $964.1 million in cash and cash equivalents and significant availability under its revolving credit facility. Its total debt as of December 31, 2024, was $2,204.6 million, with a fixed weighted average interest rate of 4.1%. Church & Dwight continues to return capital to shareholders through dividends, recently increasing its quarterly dividend by 4%, and maintains a share repurchase authorization with $658.9 million remaining availability.