01—Abstract
Summary
Summary of the 10-K filed February 13, 2025. Cited figures are marked; the original filing is the authoritative source.
Church & Dwight Co., Inc. (CHD) reported solid net sales growth of 4.1% for the fiscal year ended December 31, 2024, reaching $6.1 billiona.
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 millionb 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 millionc. 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%d 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.
02—Key points
Key Highlights
- Net sales increased by 4.1% to $6.1 billion, driven by growth in Consumer Domestic and Consumer International segments.
- Gross margin improved by 160 basis points to 45.7%, supported by productivity gains, favorable price/mix, and a tariff ruling.
- A significant $357.1 million non-cash impairment charge for the VMS business (VITAFUSION and L'IL CRITTERS) negatively impacted diluted EPS.
- Operating cash flow increased by 12.2% to $1,156.2 million, reflecting strong cash generation.
- The company expanded internationally with the acquisition of Graphico, Inc. in Japan.
- E-commerce sales represented 21.4% of total consumer sales in 2024.
- The regular quarterly dividend was increased by 4% to $0.295 per share, effective January 29, 2025.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Church & Dwight Co Inc kept $0.10.
- Revenue$6.11B100.0%
- Cost of revenue−$3.32B54.3%
- Gross profit$2.79B45.7%
- Operating costs−$1.98B32.5%
- Operating income$807.1M13.2%
- Interest, other & tax−$221.8M3.6%
- Net income$585.3M9.6%
Where FY2024 revenue went
$6.11B- Cost of revenue: $3.32B, 54% of revenue
- SG&A: $927.8M, 15% of revenue
- Other operating costs: $915.5M, 15% of revenue
- Net income: $585.3M, 9.6% of revenue
- R&D: $139.7M, 2.3% of revenue
- Interest, other & tax: $221.8M, 3.6% of revenue
Kept 9.6% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 13, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $6.11B$5.87B | +4.1% |
| Cost of Revenue | $3.32B$3.28B | +1.1% |
| Gross Profit | $2.79B$2.59B | +7.8% |
| R&D Expenses | $139.70M$122.40M | +14.1% |
| SG&A Expenses | $927.80M$889.80M | +4.3% |
| Operating Income | $807.10M$1.06B | −23.7% |
| Interest Expense | $95.00M$110.90M | −14.3% |
| Net Income | $585.30M$755.60M | −22.5% |
| EPS (Basic) | $2.39$3.09 | −22.7% |
| EPS (Diluted) | $2.37$3.05 | −22.3% |
| Shares Outstanding (Basic) | 244.40M244.90M | −0.2% |
| Shares Outstanding (Diluted) | 246.90M247.60M | −0.3% |
05—Questions
Frequently Asked Questions
What was the primary driver of the decrease in net income and EPS?
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.
How did the company's sales perform across its segments?
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.
What is the company's strategy for future growth?
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.
How is the company managing its debt and returning capital to shareholders?
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.
06—Continue