Church & Dwight Co. is increasing prices in an effort to offset rising input and transport costs.
New Jersey-based Ewing household products company will soon announce price increases for 30% of its portfolio. These will take effect in the first quarter next year. These price increases are in response to actions taken in October and July that saw the company raise prices by 50% for additional products.
Management anticipates that inflationary pressures will continue. They are currently looking at additional pricing measures that could be implemented next year.Matthew Farrell, Church & Dwight CEO, stated that significant inflation in material, component and copacker costs impacted the gross margin in Q3. We expect input costs and transport costs to remain high in Q4 and anticipate significant cost increases in 2022.
Church & Dwight's Gross Margin fell 130 basis points, to 44.2%, due to Hurricane Ida, higher input costs and transportation costs, as well as tariffs that were partially offset with productivity and price increases.
Church & Dwight reported a profit of $230.4million for the third quarter, an adjusted 92cs per share. Revenue rose 5.7% year-over-year to $1.31billion. Refinitiv surveyed analysts and found that they expected adjusted earnings of 71c per share for revenue of $1.28billion.
Farrell stated that despite the supply chain problems, 2021 will be "another strong financial year," despite them.
The company anticipates that sales will grow by 5.5% in the full year, with organic sales growth of 4.4%. This is in addition to the 9.6% organic growth for 2020.
Church & Dwight shares fell 2.2% through Thursday, compared to the 22% gain by S&P 500.Updated Date: 31 October 2021, 16:06