Church & Dwight Co. Inc. (CHD), a leading consumer products company, posted fourth-quarter 2010 earnings of 86 cents a share, falling behind the Zacks Consensus Estimate of 89 cents a share but up 4.0% from 83 cents earned in the prior-year quarter.
On a reported basis, including one-time items, earnings came in at 65 cents per share, down 12.0% from the year-ago quarter. The Zacks Consensus Estimate was stable prior to the earnings release.
Church & Dwight’s top line inched down 2.1% to $656.9 million for the fourth quarter of fiscal 2010 with organic sales decline of 1.4%. The reported revenue also fell short of the Zacks Consensus Revenue Estimate of $659.0 million.
Consumer Domestic net sales plummeted 4.3% to $472.6 million. On an organic basis, sales went down by 3.1% during the quarter reflecting lower sales of XTRA liquid laundry detergent and SPINBRUSH battery powdered tooth brushes. This was, however, partially offset by higher sales of ARM & HAMMER liquid laundry detergent and ARM & HAMMER Super Scoop cat litter.
Consumer International sales jumped 7.2% during the quarter to $120.2 million. On an organic basis, sales rose 6.0%, as Mexico, Brazil, UK, France and Australia experienced higher sales in the quarter.
Specialty Products sales inched down 1.0% to $64.1 million. On an organic basis, sales decreased 1.2%.
Gross margin increased by 40 basis points to 44.5%, reflecting better manufacturing facility and an alteration in customer delivery arrangement, partially offset by increased trade spending and commodity cost.
Other Financial Details
Church & Dwight, which faces stiff competition from Clorox Corporation (CLX), ended the quarter with cash and cash equivalents of $189.2 million, Long-term debt of $249.7 million and shareholders’ equity of $1,870.9 million.
Outlook
Church & Dwight expects organic sales to increase by 3.0%–4.0% and gross margin to expand by 50–100 basis points in fiscal 2011, while it is looking forward to earn $4.35–$4.40 per share in fiscal 2011. The current Zacks consensus Estimate for fiscal 2011 is $4.38 per share.
Church & Dwight’s shares maintain a Zacks #3 Rank, which translates into a short-term Hold rating.
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