10-QPeriod: Q2 FY2025

CHURCH & DWIGHT CO INC /DE/ Quarterly Report for Q2 Ended Jun 30, 2025

Filed August 1, 2025For Securities:CHD

Summary

Church & Dwight Co., Inc. (CHD) reported a slight year-over-year decrease in net sales for both the three-month and six-month periods ending June 30, 2025. This was primarily driven by unfavorable pricing/product mix and the planned exit from certain businesses (Flawless, Spinbrush, Waterpik showerheads), partially offset by volume increases in some segments and strategic acquisitions. Gross profit and operating income saw more significant declines due to factors such as costs associated with business exits, higher manufacturing costs, and prior-year tariff refunds. Despite the revenue and profit pressures, the company made substantial progress on strategic initiatives, including the acquisition of Touchland Holding Corp. for $700 million and the refinancing of its credit facility to $2 billion. The company also continued its share repurchase program, notably through an accelerated share repurchase of $300 million. Liquidity remains strong with significant cash and cash equivalents, and an available credit facility, positioning the company to manage its operations and strategic investments.

Financial Highlights

52 data points
Beta

Revenue

$1.51B

43.0% Gross Margin

Net Income

$191.00M

12.7% Net Margin

EPS (Diluted)

$0.78

Total Assets

$8.79B

Cash & Equivalents

$923.20M

Financial Statements
Beta
Revenue$1.51B
Cost of Revenue$859.30M
Gross Profit$647.00M
R&D Expenses$35.80M
SG&A Expenses$228.20M
Operating Income$261.70M
Interest Expense$23.50M
Net Income$191.00M
EPS (Basic)$0.78
EPS (Diluted)$0.78
Shares Outstanding (Basic)244.70M
Shares Outstanding (Diluted)246.40M

Key Highlights

  • 1Net sales decreased by 0.3% to $1,506.3 million for the three months ended June 30, 2025, and by 1.4% to $2,973.4 million for the six months ended June 30, 2025, compared to the prior year periods.
  • 2Gross profit decreased significantly due to costs associated with exiting Flawless, Spinbrush, and Waterpik showerhead businesses, prior-year tariff refunds, and higher manufacturing costs.
  • 3Income from operations declined by 22.3% for the quarter and 13.2% for the six months, reflecting lower gross profit and increased SG&A expenses, partly due to business exit costs.
  • 4The company completed the acquisition of Touchland Holding Corp for $700 million on July 16, 2025, expanding its personal care portfolio.
  • 5A new $2.0 billion Credit Agreement was entered into on July 17, 2025, replacing the prior $1.5 billion facility, enhancing liquidity.
  • 6Share repurchases remained active, with an accelerated share repurchase (ASR) contract for $300.0 million executed in May 2025.
  • 7The company announced a strategic review of its vitamin business, considering options including divestiture.

Frequently Asked Questions

The company recorded a pre-tax charge of $51.0 million in the second quarter of 2025 related to exiting these businesses. This charge included $30.4 million in Cost of Sales and $20.6 million in SG&A, impacting gross profit and operating income. The exit is expected to be completed by early 2026 and generated approximately $170 million in net sales in 2024.

The company is experiencing increased supply chain challenges and commodity cost volatility. They are taking strategic actions to mitigate tariffs, including shifting production, finding alternative supply sources, considering price increases, adjusting inventories, and lobbying for tariff exemptions. The projected twelve-month run-rate gross tariff costs are approximately $60.0 million, with efforts to reduce this exposure through supply chain and pricing strategies.

On July 16, 2025, Church & Dwight acquired Touchland for $700.0 million, subject to adjustments. The acquisition is expected to expand the company's personal care offerings. The majority of the purchase price is anticipated to be allocated to the trade name. Contingent on 2025 net sales, additional earnout consideration of up to $180.0 million may be payable.

Liquidity remains strong. As of June 30, 2025, the company had $923.2 million in cash and cash equivalents and approximately $1,494.0 million available through its credit facilities and commercial paper program. The company entered into a new $2.0 billion Credit Agreement on July 17, 2025, which replaced its prior $1.5 billion facility, enhancing its borrowing capacity.