10-QPeriod: Q1 FY2025

CHURCH & DWIGHT CO INC /DE/ Quarterly Report for Q1 Ended Mar 31, 2025

Filed May 1, 2025For Securities:CHD

Summary

Church & Dwight Co., Inc. (CHD) reported a decrease in net sales for the first quarter of 2025, down 2.4% to $1.47 billion compared to the prior year. This decline was primarily driven by lower product volumes, particularly in the Consumer Domestic segment, though partially offset by favorable pricing and mix in certain segments and growth in the Consumer International segment. Gross profit also decreased by 4.0%, and gross margin contracted by 70 basis points due to higher manufacturing costs, despite productivity gains. Despite the top-line softness, the company maintained solid operating income and is actively managing its operations and strategic direction. A significant development is the announced strategic actions for the Flawless, Spinbrush, and Waterpik showerhead businesses, which are expected to result in a charge between $60-80 million in Q2 2025. This move signals a focus on streamlining operations and potentially divesting underperforming or non-core assets. The company also reported an increase in cash and cash equivalents, providing a strong liquidity position and flexibility for future capital allocation.

Financial Highlights

52 data points
Beta

Revenue

$1.47B

45.0% Gross Margin

Net Income

$220.10M

15.0% Net Margin

EPS (Diluted)

$0.89

Total Assets

$8.96B

Cash & Equivalents

$1.07B

Free Cash Flow

$169.20M

Financial Statements
Beta
Revenue$1.47B
Cost of Revenue$807.50M
Gross Profit$659.60M
R&D Expenses$32.80M
SG&A Expenses$227.70M
Operating Income$295.30M
Interest Expense$23.30M
Net Income$220.10M
EPS (Basic)$0.90
EPS (Diluted)$0.89
Shares Outstanding (Basic)245.80M
Shares Outstanding (Diluted)248.00M

Key Highlights

  • 1Net sales decreased by 2.4% to $1,467.1 million in Q1 2025 compared to Q1 2024, primarily due to lower product volumes.
  • 2Gross profit decreased by 4.0% to $659.6 million, with gross margin declining by 70 basis points to 45.0% due to increased manufacturing costs.
  • 3Income from operations decreased slightly by 3.2% to $295.3 million.
  • 4Diluted EPS decreased by 4.3% to $0.89 per share.
  • 5The company announced strategic actions for the Flawless, Spinbrush, and Waterpik showerhead businesses, expected to incur a $60-80 million charge in Q2 2025.
  • 6Cash and cash equivalents increased to $1,074.5 million as of March 31, 2025, up from $964.1 million at the end of 2024.
  • 7The company maintained its dividend, increasing the quarterly dividend to $0.295 per share in January 2025.

Frequently Asked Questions

Net sales decreased by 2.4% to $1,467.1 million in the first quarter of 2025 compared to the prior year. This was primarily due to a decrease in product volumes sold, especially in the Consumer Domestic segment, partially offset by favorable pricing/product mix and growth in the Consumer International segment. Foreign exchange rate fluctuations also contributed to the decrease.

Church & Dwight announced strategic actions for these businesses, which generate approximately $150.0 million in annual net sales. The company expects to record a charge of $60.0 to $80.0 million in the second quarter of 2025. This charge will primarily consist of non-cash impairments of intangible and fixed assets, along with inventory reserves, indicating a streamlining of operations or potential divestitures.

Gross profit decreased by 4.0% to $659.6 million, and gross margin compressed by 70 basis points to 45.0%. This compression was mainly due to higher manufacturing costs (labor and commodities), partially offset by productivity programs and favorable price/mix. Income from operations saw a slight decrease of 3.2% to $295.3 million, and diluted Earnings Per Share (EPS) decreased by 4.3% to $0.89.

Church & Dwight maintains a strong liquidity position. As of March 31, 2025, cash and cash equivalents stood at $1,074.5 million, an increase from the previous quarter. The company also has substantial availability through its revolving credit facility and commercial paper program, indicating financial flexibility.