Church & Dwight Earnings Call Insights: Laundry Pods, U.S. Laundry Volume
On Friday, Church & Dwight Company, Inc. (NYSE:CHD) reported its first quarter earnings and discussed the following topics in its earnings conference call. Here’s what executives shared with investors and analysts.
Sarah – SunTrust Robinson Humphrey: This is (Sarah) on for Bill. We just have a couple of questions about with the laundry pods. I’m wondering if you could give us any color on the pods business and how you saw initial sell through, how the growth progressed through the quarter and what you see growth trajectory looking like in the next couple of quarters. Then were you able to gain incremental shop space at your key retailers or was it more replacement shop space? Just give us some color on that?
James R. Craigie – Chairman and CEO: It’s really too early to really give a good forecast in the pods. We were out early our distribution was almost entirely incremental. It’s off to a good start, a very good start. But it’s really too early. It’s just the latest four week share that’s coming in. It’s really early February. Marketing support is just in a big way just beginning to start and the same is true for our competitors. So it’s really too early to say how big the pods category will be and how it is doing. We are very happy with our start. Again, the distribution was terrific, it was incremental, and initial takeaway by consumers is looking good but again it is just too early to use that as projection vehicle.
A Closer Look: Church & Dwight Earnings Cheat Sheet>>
Sarah – SunTrust Robinson Humphrey: If I could just one follow-up to that question. Given how early it is in the market can you talk about your confidence level with the capacity that you have and being able to support the business coming in-house?
James R. Craigie – Chairman and CEO: Yeah, we feel very confident. Like I said the product is coming in-house by the end of Q2 and we will have plenty of capacity to meet demand for that product.
U.S. Laundry Volume
Nicholas Kawalko – Deutsche Bank Securities: It is (Nick Kawalko) on for Bill. On laundry question, can you guys just tell us how much total U.S. laundry volume was up in the quarter because, I mean, if I look at the standard data it looks like it probably came in a whole lot better than the data would suggest even considering the pre-buy. So, any help there will be appreciated?
Matthew T. Farrell – EVP and CFO: Nick, the laundry category exhibit a little bit more growth in the first quarter than some in the past but sounds good but nothing to shock pulls we are more impressed with the fact that we had very strong share gains, as we’ve had for the last couple of years, we continue to outpace the category as consumers trade down to our great value brands. But it was a good quarter, but I wouldn’t say it is trend so far so let’s see what happens over the rest of 2012.
Nicholas Kawalko – Deutsche Bank Securities: Then if you wouldn’t mind could you just comment a little further on the acquisition environment. I mean, if there has been any meaningful change since we last spoke?
Matthew T. Farrell – EVP and CFO: I would just tell you we don’t discuss any specific details on M&A. I would tell you the environment is very active and we are very involved but we have very, very specific acquisition criteria, looking only for leading brands and margin-accretive brands and asset-light brands. So far, there’s been nothing that was acquired by somebody that we regret and we’re actively looking for acquisitions that fit that bill, but that’s about as far as I can go.