Clorox CEO Linda Rendle told CNBC Wednesday that the company’s products are “home essentials” capable of withstanding rising inflationary conditions and tough economic times.
The company’s brands include its namesake Clorox products, as well as Brita Water Filtration, Glad Bags, and Burt’s Bees to highlight a few.
As an example of Clorox’s pricing power, Rendle referred to another round of price hikes set for July to help offset higher costs and “recoup margins over time.”
The CEO said Jim Cramer up “Crazy money” that Clorox brands offer superior value for the things people need to use every day, even during recessions. In 2008, during the financial crisis, “our categories were very resilient and we grew the vast majority of our brands,” she explained.
There is concern the Federal Reserveaggressive moves to eradicate inflation could slow economic growth and cause a recession. the fed increase in interest rates by another 50 basis points on Wednesday.
Clorox reported a decidedly mixed quarter after Monday’s closing bell. The stock opened lower on Tuesday but closed 3% higher. Wednesday added another 1.4%.
- The consumer packaged goods powerhouse late Monday reported fiscal third quarter adjusted earnings of $ 1.31 per share, which beat estimates but fell 19% from the period a year ago.
- Net sales increased 2% to $ 1.81 billion, slightly better than expected. Gross margin was squashed.
- The company cut its full-year earnings forecast by 20 cents, while maintaining an expected decline in net sales of between 1% and 4% for the year.
“For the first part of our fiscal year, we were seeing sales growth of 27% over the prior year period. But in this quarter, as we reached a more normalized environment, we were able to increase organic growth in three of our four segments, the vast majority of our businesses, ”said Rendle. “Furthermore, we have been able to increase the market share.”
Rendle said the cleaning habits that grew out of the Covid pandemic are sticky even as many aspects of life have returned to more normalized routines. The company has leaned on the trend, launching packaging solutions so people can “control their environment” and get products on the go, he said, noting that Clorox is a “much bigger business” than than it was before the pandemic.